By Chigumbu Warikandwa
Corrupt activities have entered the tobacco auction system. The ultimate loser in the vicious circle of corruption that has crept into the tobacco industry is the farmer. Where the farmer thinks he has benefitted, the benefit is short-lived. The negative effects are usually eventually seen in the long run.
After farmer’s trek to Harare to reap the rewards of their year long’s toil, a mammoth cancer awaits them right by the tobacco auction floor door. The shenanigans that have entered the tobacco selling process have fleeced the farmer, resulting in millions of dollars failing to reach the farmer’s pocket at the end of the season. Reports say middlemen have sprouted in the auction floors, separating the farmer and the buyer. Resultantly, the farmer is left unable to negotiate the real worth of his crop through the auction system.
Middlemen are a creation of the tobacco auctioneers themselves. Farmers allege the auctioneers themselves concoct ridiculously low prices for their crop, forcing farmers to decline the offered prices before going to engage runners employed by the very auctioneers so as to get a higher price for the same tobacco initially priced lowly.
This process of engaging unnecessary middle-marketers will see both the middleman and the auctioneer sharing the proceeds of the money they would have disenfranchised the farmer. Both the auctioneer and the middle-marketer do not create or add any value; instead they steal value from the farmer. One thing that will definitely happen is that the auctioneer will never offer a price higher than what his organisation can pay lest he loses his job. It therefore adds up that the auctioneer is simply subtracting money from the farmer for him to share with the middle marketer.
Getting smaller returns from the crop diminishes the farmer’s capacity to recapitalise for next season’s crop. If anything, if this circle continues, the farmer is likely to resign from future production of the crop. This has devastating effects on the national economy given that tobacco is the second highest earner of foreign currency in the country; outdoing even the diamond industry and every other mining industry except the gold industry.
Farmers are faced with a huge challenge in the form of investing in cleaner and alternative renewable forms of energy for guaranteed continued production. Losing money to criminal marketing activities does not help the farmer to improve himself in any way.
Farmers are also complicit in the corruption practices present in the tobacco industry. Corruption is rifest on the selling day. Contracted farmers are reportedly evading the selling floors of their contract partners and instead selling their crops using the identities of third parties, either fellow farmers or the said middle marketers. This breach of contract fails the contractors’ business, making it difficult for contracting companies to contract more tobacco farmers in the future. This practice by farmers is destroying the development of financing partners who capacitate farmers to produce more. In the absence of financing capital, the outcome is diminished returns on the farmers, the national economy and to the contractor too.
Reports have been heard in the media and other forums that contractors are themselves occasionally accused of deflating the price of the contracted tobacco leaving the farmer with very little out of his year long toil. This practice, if true, is a self undoing by the tobacco contactors for the farmers will simply shun contract tobacco production.
It is high time every authority in the tobacco industry rise to the occasion in order to arrest this cancer. If the problems in the tobacco marketing processes are not decisively responded to, the country will continue to lose millions of revenue to the system. If it is allowed to continue, the very external buyers of the golden leaf will capitalise on the process and bribe it to ensure lower prices. Hopes are pinned on the success of the newly introduced e-marketing to weed out these problems on the point of sale. Other solutions are still needed to reinforce the integrity of the industry from the farm through to the auction floor.
Sterner action and water tight controls have to be designed and implemented in order to protect the integrity of the tobacco industry. It is high time the farmer desists from any underhand dealings in order to instill discipline in the tobacco industry. With numeric superiority, once the farmers unite against all corrupt shortcuts, the industry will be fumigated of all ill-practices. The auctioneers will be left with no partners to close the deals with. The Zimbabwe Farmers Union must create a self-governing ethics authority while the TIMB uses all its muscle to protect farmer interests.
Disclaimer: The views expressed in this article are those of the writer and do not necessarily represent the Zimbabwe Broadcasting Corporation.