Sub-Saharan Africa tobacco output seen flat
Sub-Saharan Africa is expected to produce between 400 million and 450 million kg of tobacco in 2010, similar to 2009 output, a senior industry official said on Thursday.
The world’s top cigarette makers, including British American Tobacco, Philip Morris and Japan Tobacco International, all source tobacco from Africa, which could increasingly play a part in meeting global demand.
“With subsidies going to disappear in Europe we expect in the next couple of years a 100 million kg of tobacco production will be lost in Europe, so somebody must take that gap… and Africa is ideally placed to up their production and fill that gap,” Francois van der Merwe, chief executive of the Tobacco Institute of Southern Africa, said.
Malawi, the world’s biggest producer of burley tobacco, will dominate Africa’s production with a crop forecast at 215 million kg, of which 185 million kg would be burley and the balance flue-cured tobacco, he told Reuters.
“If you take countries like Kenya, Malawi, South Africa, Tanzania, Uganda, Mozambique Zambia and Zimbabwe, the total forecast is estimated at between 400 and 450 million kg,” he said.
He said Malawi, where good prices on auction floors fuelled a rise in tobacco production in the last four years, could scale down production if an oversupply of the golden leaf threatened prices.
“We believe that the production in Malawi is maybe a bit on the high side…and the Malawians reckon the production of burley should be in the region of between 130 and 150 million to maintain reasonable prices and to supply the market sufficiently,” Van der Merwe said.
Tobacco is the southern African nation’s main foreign exchange earner and accounts for more than 60 percent of exports and 15 percent of the gross domestic product in Malawi.Van der Merwe said a political solution was necessary to resuscitate Zimbabwe’s tobacco industry.
Output in Zimbabwe, Africa’s former No.1 tobacco grower,
dropped from a peak of 235 million kg to around 40-50 million kg at the time white-owned farms were seized in 2000.
“For the region Zimbabwe is extremely important because of the quality and the volumes they produced. It draws world buyers right down the southern tip of Africa,” Van der Merwe said.
Zimbabwe was expected to produce 60 million kg of tobacco this year, similar to that of Tanzania, while output in South Africa is expected to be 12 million kg.
By Wendell Roelf, Reuters
