Zimbabwe Tobacco Growers Call for Review of 70:30 Forex Policy

Tobacco bales at Harare auction floors

As Zimbabwe prepares to officially open the 2026 tobacco marketing season on March 4, growers are calling on authorities to review the country’s 70:30 foreign currency retention policy, arguing that the current framework is squeezing profitability.

Under the policy, farmers receive 70% of their tobacco sales earnings in U.S. dollars and 30% in local currency (ZiG). However, growers say most production inputs, including fertilisers, chemicals, fuel, and equipment, are priced in U.S. dollars, making the ZiG portion less valuable in real terms.

Farmers Demand Alignment With Production Costs

Zimbabwe Tobacco Growers Association chairman George Seremwe said farmers are fully prepared for the new selling season but want payment structures aligned with input costs.

He noted that without reforms to the retention policy, growers risk losing a significant portion of their earnings due to exchange rate disparities and the dominance of U.S. dollar-denominated expenses.

Similarly, Tobacco Farmers Union Trust president Edward Dune stressed that fertilisers and other critical inputs are largely sold in foreign currency, effectively reducing the value of the 30% paid in ZiG.

TIMB Confirms Market Readiness

The 2026 marketing season will be overseen by the Tobacco Industry and Marketing Board (TIMB), which has announced comprehensive preparations for the new cycle. TIMB confirmed it has licensed 48 contractors and 46 Class A buyers for the 2025/26 season. Three auction floors will operate this year:

• Tobacco Sales Floor

• Premier Tobacco Auction Floors

• Ethical Sales Floor

Authorities have also intensified efforts to curb side marketing and unregistered buyers accused of offering below-market prices. Farmer organisations, including the Zimbabwe National Farmers Union, are urging growers to sell exclusively through formal channels to guarantee fair pricing and secure payments.

Production Outlook Remains Strong

The marketing season will coincide with the rollout of the Tobacco Value Chain Transformation Plan 2, a strategic blueprint aimed at boosting annual tobacco output to 500 million kilogrammes by 2030. More than 400 million kilogrammes are expected to be delivered this year, supported by a 15% increase in planted hectarage. Zimbabwe currently has 113,327 registered tobacco growers, reflecting sustained participation in the sector.

Officials remain optimistic about the 2026 crop, citing favourable weather conditions and expanded production capacity. The strong output is expected to reinforce Zimbabwe’s status as Africa’s leading tobacco producer and one of the world’s top exporters of flue-cured tobacco.

Zimbabwe; tobacco farmers; review; auction floor; forex policy