Malawi’s Tobacco Earnings Down 31% After 14 Weeks of Trading Share

Tobacco earnings in Malawi, the world’s largest producer of the burley variety, have fallen 31 percent after 14 weeks of trading compared with a year earlier, according to Auction Holdings Ltd., a buyer.

Earnings from tobacco fetched $161.2 million by June 23, compared with $233.9 million during the same period a year earlier, Auction said in a statement handed to reporters in Blantyre today.

During the period, farmers sold 99.5 million kilograms (219 million pounds) of tobacco at an average price of $2.08 per kilogram, compared with 98.7 million kilograms at an average price of $2.24 last year.

While the government has set a minimum price of $2.15 per kilogram, buyers are offering farmers less than that because the leaf is of a poorer quality than last year and as the global recession curbs demand.

Tobacco is Malawi’s main foreign exchange earner, accounting for 60 percent of the country’s export earnings. Burley tobacco is a lower-grade variety of the leaf used to fill cigarettes flavored with higher-grade flue-cured tobacco.