Zimbabwe farmers hold on to tobacco crop in price stalemate

HARARE (AFP) — Zimbabwe's tobacco selling season was called off for the second time in as many weeks Wednesday after farmers withdrew their crop from the auctions citing low prices.

The auction floors in Harare, ranked among the continent's largest, were supposed to open at 7:30 am (0530 GMT), but after around 80 bales went under the hammer, farmers started ripping off the price tags in protest.

"The price is useless, I would rather keep my tobacco and sell to buyers from Malawi or Zambia," Ottilia Mavhunga, a farmer from Karoi, a farming town in northern Zimbabwe, told AFP sealing her tobacco bales.

"I have been waiting here since Tuesday last week for them to offer us this nonsense."

An AFP correspondent witnessed angry farmers standing on tobacco bales as they shouted their protest over the price while some tore the bales and flicked tobacco leaves around the floor.

Around 400 farmers waited on the auction floors as officials from government, buyers and farmers' representatives met to try to resolve the price dispute.

The government offered the farmers 70 million dollars as the equivalent of one US dollar per kilogram, falling short of the parallel market rate widely used by service providers.

Farmers get paid in Zimbabwe dollars based on the official exchange rate with the US dollar which is a tiny fraction of the black market rate in a country where inflation is running at around 165,000 percent.

In April last year, sales of tobacco -- once Zimbabwe's top foreign exchange earning crop -- were also delayed over a pricing stalemate.

Tobacco production in Zimbabwe has declined from a record high of 236.13 million kilogrammes (236,130 metric tons) in 2000, the year controversial land reforms were launched, to just 68.8 million kilogrammes last year.