Zimbabwe’s tobacco boom, but black producers sue debt

Harare, Zimbabwe (AP) — Zimbabwean tobacco is thriving again. And so is the auction where the premium price is paid for the “golden leaves” that are exported all over the world.

Most of the producers are black, a historic change since tobacco was produced primarily by white farmers. However, many smallholders complain that they are in poverty by a middleman merchant who is being drawn into a debt trap.

Rosemary Zozza recently traveled 200 km (125 miles) to the capital Harare with tobacco crops that she wanted to have a good payday.

The 60-year-old farmer has to sleep outdoors for two weeks to wait for payment. When the money finally came, it was just a small part of what her cigarette actually took at the auction.

“My cigarette sold for $ 7,000, but I’m going home for less than $ 400,” she said with anger. The rest of the money went to the merchant who gave her a loan to pay for fertilizer, seeds, labor, firewood for curing, and even household groceries under a contract cultivation scheme.

In addition to paying off the loan with interest, Dzodza was obliged to sell her crops to the merchant at the price he set. The merchants then sold tobacco to the highest bidders or wealthier merchants, mainly buyers who export crops to China, at auction.

For over 60 years, tobacco has been a profitable export crop for white farmers. However, tobacco production has plummeted, often violently since 2000, when Robert Mugabe’s supporters began seizing white-owned farms. Flue-hardened tobacco yields fell from a peak of 260 million kilograms in 1998 to just 50 million kilograms in 2008.

Since then, tobacco production by black farmers has grown. Before the land reform, thousands of white farmers produced most of the tobacco crops, but now there are more than 145,000 mainly small black farmers. Zimbabwe’s tobacco crop is estimated to be 200 million kilograms this year, up from 180 million kilograms last year, and the recovery has been remarkable in recent years.

Zimbabwe’s commercial banks have financed white farmers so they can buy crop inputs. However, the bank withdrew a few years ago because the government did not issue transferable ownership certificates to black farmers who had resettled on land previously owned by whites.

The contract expansion plan helped black farmers desperately try to get into the tobacco jackpot. It was started primarily by Chinese buyers, but it is now profitable enough to attract dozens of Zimbabwean merchants.

According to the regulatory body, the Tobacco Marketing Industry Commission, 96% of tobacco farmers raise funds under a contract expansion scheme.

The contract system is welcomed by reviving tobacco and establishing Zimbabwe as Africa’s largest crop producer. However, many black farmers say that greedy merchants make them poor.

George Selemwe, chairman of the Zimbabwe Tobacco Association, said farmers are charged high interest rates on loans, many of which are prey to predatory contractors.

“It’s a deficit venture. Farmers are always in debt because they have to borrow another loan as soon as they repay the loan. Year after year, they are in debt,” he said.

Some lose their livestock (the only wealth) to the merchants after failing to repay the loan due to poor harvest, while others are “threats”, according to Seremwe.

This year’s Tobacco Industry Marketing Commission has freed 20,000 farmers from contracts with merchants who tried to deceive them by inflating the value of the inputs supplied.

According to a survey released last year by Tobacco Control, a journal on tobacco research, more than 90% of tobacco farmers want out-of-contract growth, but can’t find alternative funding.

According to a survey, nearly 60% of farmers said they were in debt.

“There is no evidence to suggest that tobacco cultivation in its current state has benefited (black) tobacco farmers. Tobacco farmers are primarily victims, not beneficiaries of this sector,” the report said. Stated.

Zimbabwe Reserve Bank Governor John Mangudia told state media in April that “models are currently expensive and need to be reviewed,” in response to complaints from farmers.

At the heart of the problem is the inability of resettled farmers to raise their money through banks, said economist and analyst John Robertson.

“Banks are afraid to keep a piece of paper if farmers fail to repay. They can’t touch the land,” Robertson said.

The government states that the solution lies in the state-owned Land Bank, which was launched in April. Some are skeptical, but farmers like Dzodza can only pray for their success.

“Otherwise, I would have to stay in contract farming. It’s like we’re chained together,” she said.

Posted on