Zimbabwe’s 2026 tobacco marketing season opened on Wednesday with the first bale selling for US$4.60 per kilogramme, slightly below last year’s opening price of US$4.65. Farmer representatives are calling for a review of the foreign currency payment policy  to protect their profits.

The opening price, achieved at the Tobacco Sales Floor in Harare, sets the initial benchmark for a season in which the Tobacco Industry and Marketing Board (TIMB) projects output will reach 400 million kg.

This follows a record 2025 crop of 335 million kg, reinforcing tobacco’s position as the country’s second-largest foreign currency earner after gold.

However, the upbeat mood at the opening ceremony was tempered by persistent concerns from growers regarding the 70:30 foreign currency retention policy. Under the current system, administered by the Reserve Bank of Zimbabwe, farmers receive 30 percent of their proceeds in the local currency, the ZiG.

George Seremwe, president of the Zimbabwe Tobacco Growers Association (ZTGA), confirmed that farmers are ready for the season but argued that the payment structure is misaligned with the realities of production.

“The majority of our costs, including fertilizers, chemicals, and labor, are pegged in United States dollars,” Seremwe said.

“Receiving 30 percent of our earnings in local currency under these conditions cuts deeply into our potential earnings and compromises the viability of our operations.”

Edward Dune, president of the Tobacco Farmers Union Trust, echoed these concerns, pointing to the specific input costs that drive a wedge between earnings and expenditure.

“Farmers purchase nearly all their agricultural inputs using foreign currency,” Dune explained.

“When a significant portion of our payment is in ZiG, it simply does not stretch as far to cover those dollar-denominated costs, reducing the real value of our hard work.”

The tobacco sector is dominated by smallholder farmers, who produce approximately 85 percent of the crop.

With more than 135,000 households relying on tobacco income, the pricing and payment mechanisms have significant socio-economic implications.

In response to these concerns, the government has outlined plans to increase local funding for the crop.

The goal is to reduce the sector’s heavy reliance on foreign contractors, who currently finance a substantial share of production through contract farming arrangements.

This shift is a key component of the newly launched Tobacco Value Chain Transformation Plan 2, which aims to increase local ownership and control over the lucrative value chain.

The plan, officially launched by Lands, Agriculture, Fisheries, Water and Rural Development Minister Dr. Anxious Masuka during the opening ceremony, seeks to build a foundation for the industry to achieve 500 million kg of golden leaf annually by 2030.

Despite the payment concerns, preparations for the season have been extensive.

TIMB chief executive officer Emmanuel Matsvaire confirmed that all regulatory and logistical arrangements were finalized ahead of the March 4 opening.

The board has licensed three auction floors in Harare Tobacco Sales Floor, Premier Tobacco Auction Floor, and the newly approved Ethical Sales Floor as well as 48 contractors and 46 Class A buyers.

The quality of this year’s crop is expected to benefit from favorable rains, and farmers are optimistic about achieving competitive prices.

As bales continue to arrive at auction floors in Harare and five decentralized selling points across the provinces, all eyes will remain on whether the strong opening price translates into sustained returns for the nation’s tobacco growers.