Tobacco Farmers To Retain 60 Per Cent Forex Earnings

Tobacco farmers will be paid 60 per cent of their proceeds in foreign currency, with 40 per cent being in local currency.

Last year farmers were paid 50 per cent of their proceeds in US dollars with the other 50 per cent being in Zimbabwe dollars.

Lands, Agriculture, Fisheries, Water and Rural Resettlement Minister, Anxious Masuka, said last week said the 2021 tobacco selling season will start soon.

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Masuka also said the Ministry was engaging the Reserve Bank of Zimbabwe (RBZ) and farmers representatives to ensure that everything runs smoothly.

Responding to questions in Parliament last week, Masuka said:

The opening of tobacco auctions is coming very soon and we are busy engaging with the buyers together with the Reserve Bank and farmers representatives who have submitted areas they would want to be improved from last year.

The Reserve Bank has put in measures to the effect that there is going to be the same treatment to everyone who is exporting produce so that tobacco farmers are happy because they are going to get 60 per cent of the US dollar component.

We are busy ensuring that the two come to an agreement before the opening of the tobacco auction floors.

In 2020, tobacco farmers were not happy after the RBZ insisted on paying for their crop using the official exchange rate of US$1: ZWL$25, which was prevailing at the time.

Currently, the official exchange rate is at US$1:Z$83 but far below the alternative exchange rate of US$1:Z$120.

However, farmers want to be paid all their proceeds in foreign currency because the majority of their inputs are now being sold in US dollars

More: Chronicle

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Tobacco Farmers To Retain 60 Per Cent Forex Earnings