Four more firms to finance tobacco farming

Tobacco Industry Marketing Board (TIMB) has approved four new firms to finance contract farming, a move likely to help improve tobacco output, an official said yesterday.

The contract farming system, which guarantees inputs and a ready market for farmers, is credited with spurring the revival of the tobacco industry in recent years.

For the 2013/2014 season, contractors supported over 54 percent of registered growers and funded 72 percent of the total planted area according to TIMB data.

In the previous season, contractors accounted for 68 percent of all tobacco purchases, up from 63.7 percent in the prior year.

Contracted farmers also get better prices, with the highest price for contract tobacco at $5.80 per kg compared to $4.99 achieved on the auction floors.

The gap between auction and contract average prices has widened from 4.5 percent in 2012 to 26.7 percent this year.

The approval brings the number of contracting firms for the 2014/15 season to 21.

TIMB chief executive, Andrew Matibiri said that the board had assessed and approved four new firms.

“We have received a number of applications for contract farming but for now the board has approved four new firms. They are Clarifact, Mhofu Portfolio, Maxlucky Tobacco Company and Premier Tobacco Floor,” he said. –The Source

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