37 000 tobacco growers deregistered

IN a bid to cleanse the tobacco sector of corruption, the Tobacco Industry Marketing Board (TIMB) has deregistered 37 000 growers and suspended 11 contractors accused of fuelling side-marketing of the golden leaf.

But despite the deregistration, the number of growers registered for this season shot to 106 067, compared to 80 069 during the same period last season.

More than 5 000 hectares of irrigated tobacco has since been planted.

The move to deregister growers and suspended contractors seeks to address the issue of side-marketing and compliance to promote orderly marketing, as well as sustainable and viable tobacco production for the 2022/23 season.

These growers were registered and grew tobacco in the previous seasons but did not deliver any of the tobacco to the auction floors or contract selling points.

It is suspected that they engaged in side-marketing activities.

In side-marketing tobacco, a contract grower can sell their tobacco to another person or entity instead of the contractor.

A research conducted in 2013 cited the low prices offered to farmers, poor yields and farmers’ greediness as the major drivers of side-marketing in Zimbabwe’s tobacco industry.

Tobacco contracting companies were also found to be charging high interest rates or administrative charges on loans extended to contract farmers.

Some of the suspended companies included Agritrade,

Chevron, Munakiri, Bindura Leaf, Mbaluk, Huruyadzo and Sub-Sahara, among others.

TIMB has also instituted a compliance administration framework which seeks to eradicate challenges around dual production and marketing by imposing a minimum package of inputs that should be provided by contractors.

TIMB spokesperson, Ms Chelesani Moyo said the board has introduced stringent measures for growers and merchants to safeguard the integrity of the contract system to avoid short changing farmers and guaranteeing people’s returns on their investments.

“Deregistration is one of the many steps in ending side-marketing. Removal of these suspected perpetrators means there is 37 000 less side marketers,” said Ms Moyo.

“During the 2022 marketing season, 11 companies were suspended for side-marketing, but eight of the suspensions were lifted after they fulfilled certain obligations.

“Three tobacco companies were stopped from operating upon the repetition of similar offences,” she said.

TIMB’s inspectors that are deployed in every tobacco producing region investigate and bring all offenders to book.

“A compliance administration framework has been introduced to further regulate the conduct of contractors.

“The new framework will see contractors complying because they do not want to compromise their business operations,” she said.

Ms Moyo said some tobacco companies are shortchanging farmers by delaying payments for tobacco delivered to the auction floors.

In fact, some farmers have not yet been paid for deliveries made in June 2022, despite a policy stipulating that payment should be done within 48 hours.

“We encourage companies to pay growers within 48 hours of sales. If they are not paid, we encourage growers to contact 0774 075 045.

“TIMB will ensure that payment is made. We have several tobacco growers who have come forward with delayed payments and we have managed to assist them,” said Ms Moyo.

Contract farming is a strategic tool for agri-businesses as it seeks to ensure greater reliability of agricultural products’ supplies.

About 96 percent of tobacco grown in Zimbabwe is financed through this model.

Under the arrangement, a grower enters into a contract with a company that provides inputs, with the costs deducted from the grower’s earnings at the end of the season through a stop order system