The Malawi Tobacco Industry:
A Historical Perspective
Tobacco has been grown in Malawi for over 100 years. There are reports that Flue Cured tobacco was first exported from Nyasaland Protectorate (pre-independence name for Malawi) at about the turn of the 20th century. Fire-Cured and Burley tobacco were introduced later with commercial production beginning after the Second World War. Tobacco Production is widely dispersed over most of Malawi. Burley and Flue-Cured types are grown in all the three regions. Flue-Cured is largely produced in the Central and Southern Regions except for a small pot in the north.

Zimbabwe. This was the case in the mid 1960’s when the United Nations imposed sanctions against Zimbabwe (then known as Rhodesia). Demand for Malawi’s tobacco, notably Flue-Cured, soared during the late 1960’s as importers sought low cost substitutes for the Zimbabwe crop.

Malawi’s production of the Flue-Cured tobacco rose from about 12 million kilos in 1980 to 26.3 million kilos in 1996. During the same period, Burley production increased from 2.2 million kilos to 16.6 million kilos. Total leaf production tripled during the same period from 18.6 to 54.1 million kilos.

Following the lifting of the United Nations trade sanctions against Zimbabwe in 1980, Flue Cured production in Malawi stabilised at about 21 million kilos. However, demand for Burley tobacco surged in 1981 as the United States experienced 3 years of reduced production.

Some of the first exports went over the Shire and Zambezi river
Burley Tobacco
The demand for Burley during the early 1990’s was directly influenced by disease and adverse weather conditions in the Unites States that reduced the 1979 Burley crop by 78,000 tons in that country.

The 1980 US Burley crop suffered from a drier than normal season and the recovery was less than needed to meet demand. In addition, the 1981 crop suffered the disease problem that affected the 1979 Burley crop. These factors resulted in a reduction of US Burley stocks that led to US buyers seeking supplies elsewhere.

The auction price of the 1981 Malawi Burley crop rose by 97% compared to that of 1980. This consequently led to the increase in the production of the 1982 Malawi Burley crop by 47%. New farmers entered Burley production and established farmers increased acreage. However, demand for the 1982 27 million kilo crop was still strong and compensated for the increased production so that prices only fell marginally.

The two years of high prices spurred growers who, without any form of control, increased acreage by 87% and production reached 41.5 million kilos in 1983. Disaster struck and auction floor prices fell by 40%. In a reactive manner, the Ministry of Agriculture in conjunction with the Tobacco Control Commission (TCC) introduced a quota system for Burley production from 1984, however the quota was lifted in 1994 on the recommendation of the World Bank.

> In 1984 Burley production was limited to 30 million kilos. This level was maintained until 1987 when production increased to 36.8 million kilos and this further increased to 45 million kilos in 1988. In 1989 production reached 61.2 million kilos.

This increase was a result of 2 consecutive droughts in the U.S. Burley producing regions in 1987 and 1988. Another factor was the relative low price of Malawi Burley in relation to the U.S. Burley because of the relative strengths of the two countries’ currencies. Furthermore, and probably the most important factor was the acceptance of customers that Malawi Burley has qualities that compete favorably with any other region.

1990 saw the start of a big surge of burley production in Malawi. The sales of American blend cigarettes which have a burley content of around 30% of cigarette weight was taking off in Europe and the Far East. The demand for good filling Burley reached its peak in 1991 when a crop of 75 million kilos was produced and sold for an average of $2.45 per kilo. In two years the crop reached the 100 million kilo mark. However prices dropped dramatically and so did production.

In 1994 the production dropped back to 71 million kilos. The following year a “grow more Burley” campaign raised production up to 100 million kilos again with buoyant prices being paid once again. Over the next 12 years a crop between 110 and 130 million kilos was produced. However in 2004 due to ideal weather conditions a crop of 151 million kilos was grown and sold over the auction floors at an average price of $1.09 per kilo.


1900 - Tobacco barn
Flue-Cured Tobacco
In Malawi Flue Cured tobacco is grown by 350 registered growers in about 500 large estates. The flue cured tobacco produced in Malawi is a combination of tobaccos developed in Zimbabwe and the U.S. Recently, the Tobacco Research Institute of (TRIM) has developed disease resistant varieties, which are unique to Malawi.

The main problem facing Flue Cured tobacco in Malawi is the shortage of firewood for curing the leaf. In the country wood is the only practical fuel for curing Flue Cured and Fire Cured tobacco. In addition, a large percentage of the population heats and cooks with wood and all the building in the rural areas utilise at least some wood in the construction process. To some degree the shortage of firewood is hindering the expansion of Flue Cured and Fire Cured production.

Production of Flue Cured was 24 million kilos in 1987. It dropped to 20.7 million kilos in 1988 and 19.7 in 1989. With increased demand for Malawi Flue Cured tobacco, auction prices have been steadily increasing.

In 1992 Malawi produced 25 million kilos of Flue Cured which sold at an average price of $2.99 per kilos. A worldwide over supply of FCV saw trouble ahead for the Malawi Flue Cured tobacco farmer. Crop production fell steadily over the next eight years to a record small crop of only 8.2 million kilos in 2001. Farmers were not only experiencing low prices but increased input costs. Shortage of fuel wood coupled with low yields made Flue Cured farming in Malawi unviable .

In 2003 with the encouragement of certain manufacturers, tobacco dealers were encouraged to invest in Flue Cured tobacco farming with the intention of increasing production and reducing growing costs. Unfortunately the huge capital costs involved in bringing the crop up to a marketable size again could not be recovered from the cost of the sale of the tobacco. In 2007 the dealers decided to pull out of the FCV investment and hand the growing of Flue Cured tobacco back to the farming organizations.

First Malawi President at the opening of the Limbe floors in 1992.









Quality picking of tobacco prior to threshing.
Fire-Cured Tobacco
Fire Cured tobacco is produced by smallholders on customary land. More than 50,000 growers produce Fire Cured tobacco. On average each grower has slightly less than one hectare. Fire Cured tobacco is divided into Northern Division Fire Cured (NDF) and Southern Division Fire Cured (SDF). Generally these two crops are the same in that the seed used is the same, but SDF tends to be lighter cured than NDF due to a lower supply of wood for curing in Southern Malawi.

The production of Fire Cured as well as Oriental Cured tobaccos is controlled by ADMARC. Once a crop target is determined, ADMARC sets a quota for each grower based on his historical performance, his capacity to produce, and the recommendation of the government extension officer in the area. Free seed is distributed to growers based on the size of their quota. During the growing season, the smallholder farmers are provided with agronomic advice by the extension officers in their areas.

Prompted by two consecutive years of high price a crop of 21 million kilos was produced in 1991. This huge crop created a worldwide overproduction which was to last for a few years. The crop was liberated from ADMARC control and farmers were able to sell their tobacco directly to the market.

This decision had a detrimental effect on the quality of the tobacco and very low prices were fetched at the market, a situation which forced the farmers to sell their tobacco across the border to Mozambique. Today the crop is in a recovery stage with efforts being made to get production up to marketable levels.

Most of Malawi’s Fire Cured tobacco is exported to Europe for use in the Roll Your Own tobacco industry. Traditionally, Malawi tobacco is very popular in the Egyptian water pipe trade.

This tobacco directly competes with U.S. Fire Cured tobacco exports. In fact most of the European companies that buy from the U.S. are also major purchasers of Malawi Fire Cured tobacco.

Quality Dark Fired tobacco.








 
Tobacco farmer on his tobacco estate.
Malawi Oriental Tobacco
The Malawi Oriental tobacco crop was first introduced into Malawi in 1954 in the Mzimba District of the Northern Region. LLTC started handling Oriental tobacco in 1969 in conjunction with ADMARC who subsequently bought the crop from the growers. The total crop was packed into two blends: IN1, a natural blend and Kappa, a light perished grade.

In 1973 the R.J. Reynolds Company showed interest in tip (upper plant position). These were sent to them for analysis and in return the company sent an Oriental Tobacco expert to Malawi to evaluate the crop potential. Until then Malawi was unable to produce large quantities of American-type blends and the R.J. Reynolds Company was not interested in small lots.

Mzimba district was picked for the growing of Oriental tobacco not because it has special soils and weather, but because of the political need for distribution of cash crops to smallholder farmers in various districts throughout the country.

Harvest storage on an estate.
Conclusion
Today, over 50% of Malawi’s population has some sort of involvement in the tobacco industry and on average tobacco contributes 80% of the economic revenue of the country. Over the years the nation has emerged the largest exporter of Burley tobacco in the world-exporting to over 70 countries. Needless to say, the tobacco industry plays a vital role to Malawi’s economy, and remains a prime source of revenue for socio-economic development within Malawi.