LILONGWE, Aug 10 (Reuters) - Revenue from Malawi’s major export crop tobacco has risen 35 percent compared to last year and could exceed $300 million by the end of the season later this month, industry data showed on Friday. The industry regulator Tobacco Control Commission (TCC) said the increase stemmed in part from an influx of leaf imports from neighbouring Zambia and Mozambique, which Malawi sold on.
“The increase is due to volatility at our borders. A lot of tobacco has moved in from Mozambique and Zambia, and this has gone above our local production estimates,” said Kaisi Sadala, TCC Chief Executive Officer.
The TCC forecast production at 147 million kilograms against market demand of 170 million kilograms.
Figures released by Auction Holding Limited, the official auctioneer, showed that 164.3 million kilograms of tobacco had been sold at an average price of U$1.74/kg by Wednesday.
Revenues rose to $285.2 million so far this year from $210 million in 2017.
The Malawi tobacco selling season is in its 18th week and will close at the end of August. With 80 percent of all leaf now sold directly under contract, most buyers have already had their requirements fulfilled, prompting the TCC to request them to purchase more as an incentive to farmers.
“We have bought more than the volumes we contracted from our growers, and we continue to buy from the Mzuzu market in the Northern region,” said Limbani Kakhome, a spokesman for Japan Tobacco International (JTI), one of the major buyers in Malawi.
Tobacco season is helping boost the value of the local currency which on Friday traded at 717 kwacha to the dollar compared to 750 before the market opened in February. (Reporting by Frank Phiri Editing by Ed Stoddard and Kirsten Donovan)