Tobacco prices have seen a huge rise on Zimbabwe’s auctions floors surpassing the previous highest level of USD 4.99 per kilogramme and suggesting strong demand for the “free-funded” crop, reports The Herald.

One buyer bid USD 5.05 per kg – the highest price in over 10 years. It is thought that the jump comes largely from “freed funded” tobacco, grown by individual farmers which accounts for around 7 per cent of the total crop.
After producing a record-breaking 296 million kgs of tobacco last year, the projection for this year lies at around 265 million kgs due to adverse weather conditions in the country.
While auction prices have surged by 26 per cent year-over-year, prices offered by the contractors have only increased by 13 per cent, according to statistics from the Tobacco Industry and Marketing Board, reports The Herald. With prices rising on the auction floors the debate to increase local financing for tobacco growing has been reignited.
“The continued reliance on contract farming after two decades suggests there might be deeper issues with the model itself,” said Harare-based development economist Tobias Musara.
“Ideally, a few seasons of participation should equip the farmers for self-sufficiency. This dependence on contract financing needs to be addressed to ensure long-term benefits for our local farmers.”
Contracting farming began around 2004 and was meant to close the gap created by banks’ reluctance to fund newly resettled farmers, however, critics now argue that the contract farming model traps farmers in a cycle of debt, with Harare-based analyst Carlos Tadya even comparing the contract farming model to “modern slavery”, reports The Herald.