Farmers Allege Price Manipulation in Tobacco Auction System, Demand Government Intervention

In what’s unfolding as a potentially egregious case of market manipulation, Zimbabwe’s tobacco farmers are raising the alarm over what they perceive as unjustifiable disparities in the pricing of their crop, casting a shadow over the auction system’s integrity. Tobacco, a key cash crop for Zimbabwe, has seen its auction prices suspiciously capped at US$4.99 per kg for premium quality, starkly contrasted with up to US$6 per kg attainable through contract sales. This discrepancy is causing uproar among the farming community, with the Tobacco Farmers Union Trust (TFUT) spearheaded by Mr. Victor Mariranyika, calling for urgent government intervention to rectify the pricing anomaly.

The auction system, initially designed to benefit large-scale plantation growers, has gradually lost its appeal among the now-dominant small to medium-scale farmers due to this pricing issue. Approximately 95% of the tobacco crop is now being sold through contracts, as farmers gravitate towards more lucrative deals offered by private companies, leaving the auction floors in jeopardy of becoming obsolete.

Mr. Patrick Devenish, chairman of the Tobacco Industry and Marketing Board (TIMB), expressed concern over the situation, emphasizing that tobacco of the same quality should naturally fetch similar prices across both platforms. The TIMB is in the process of engaging with the trade to uncover the root cause of this discrepancy, which they hope is not a result of collusion—a practice that’s strictly prohibited.

Adding to the chorus of concerns, the Competition and Tariff Commission, through spokesperson Mr. Tatenda Zengeni, announced its monitoring efforts aimed at safeguarding the market from any collusion. The commission’s vigilance is particularly geared towards protecting the interests of small-scale farmers, who form the majority of the tobacco producers and are perceived to be at greater risk of exploitation.

Farmers like Mrs. Olgah Munetsi and Mr. Farai Ruwizhu voiced their dissatisfaction, highlighting the unfairness of the system that fails to reward them equally for their hard work compared to those under contracts. They call for a review of the auction system to ensure fair value for all farmers, echoing the sentiment that the government should step in to prevent further exploitation by unscrupulous traders.

This brewing controversy underscores the critical need for transparency and fairness in agricultural commodity trading, with potential implications for Zimbabwe’s economy and the livelihoods of thousands of farmers. As the situation develops, all eyes will be on the government and regulatory bodies to take decisive action in addressing these concerns and restoring faith in the tobacco auction system.- Agencies