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Tobacco farmers demand forex

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Tarisai Machakaire 

SENIOR STAFF WRITER

machakairet@dailynews.co.zw

TOBACCO farmers are demanding foreign currency payments for their crop ahead of the upcoming 2021 marketing season.

This comes as the farmers, represented by Tobacco Farmers Union of Zimbabwe (Tofuz), are complaining that inputs and labour were being charged in foreign currency yet they received Zimbabwe dollar payments for the golden leaf last season.

In a letter addressed to the Tobacco Industry Marketing Board (TIMB), Tofuz executive president Believe Tevera is demanding a change in the retention scheme.

Last season, tobacco farmers received their payment in a ratio of 50/50 between United States dollars and the local currency.

This season though, they want a revised retention scheme of 70 percent foreign currency and 30 percent local currency.

“We request that TIMB should be clear on the payment method and not make last minute announcements which would ambush farmers.

“There should be clarity on the foreign currency retention threshold and it should be announced in time before the opening of the selling season.

“Most farmers last season failed to recapitalise given that all inputs used in tobacco production are denominated in US dollars, forcing most farmers to shift to contract farming.

“As a union we therefore propose that the Zim dollars part should be exchanged using the rate on the local market, not the low rate on our foreign currency auction system,” Tevera wrote.

He also urged TIMB to engage with monetary authorities to ensure that cash is readily available at banks to enable farmers to settle payments and prepare for the 2021-22 farming season.

Tofuz also wants farmers to be present at the auction floors in order for them to access their payments in a timely manner.

“TIMB needs to effectively monitor auction floors’ conduct. In the previous marketing season, many auction floors took advantage of the absence of farmers to collect their payments and deliberately delayed in making payments, which disadvantaged farmers.

“TIMB needs to put in place a monitoring mechanism to ensure that farmers are paid promptly upon conclusion of sales so that they are not exposed to Covid-19 through unnecessarily long stays at auction floors.”

TIMB chief executive officer, Andrew Matibiri said Tofuz’s request would be considered when they plan for the marketing season.

At the moment, it is not clear when tobacco will go on sale due to the Covid-19 pandemic which has seen the government impose a hard lockdown at the start of the year before it was slightly relaxed on Monday.

“I would like to thank you very much for personally taking time to write and offer suggestions for the upcoming 2021 marketing season as well as on general issues of tobacco farmer’s welfare.

“Your suggestions are very valuable and will be incorporated into proposed processes for use during the 2021 marketing season,” Matibiri responded to Tofuz’s letter.

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