eBusiness Weekly
BH24 Reporter
HARARE – Tobacco farmers are seeking Government protection from insurance companies that are arbitrarily deducting money from their sales proceeds without their consent.
Tobacco farmers have urged Government to intervene over the issue.
Farmers who spoke with this publication said they are having difficulties dealing with the insurance companies, most of which are apparently new operations.
According to the tobacco farmers, some contractors linked with insurance companies promise to finance production, but do not explain that the insurance companies are guarantors of the schemes.
Farmers willing to benefit from the subsequent input schemes are then made to sign contracts and pay a nominal fee per hectare.
The tobacco farmers end up insuring their crop unknowingly, only to realise it when the money is deducted at the auction floors.
One of the affected farmers, Spesher Matepe, who lost over $200 in a single sale, said he joined the ‘input scheme’ because he did not have enough money to produce his crop.
“But I never got any assistance under the input scheme although I had paid $55 per hectare for the five hectares of tobacco to the Zimbabwe Progressive Tobacco Farmers’ Union,” he said.
Mr Matepe had his money deducted at the auction floors despite having financed the crop on his own.
“I am now facing difficulties getting refunds and have been told that the stop order was already processed and, as long I continue selling my crop, the insurance company will continue deducting money,” he said.
Mr Matepe’s efforts to get his money back from a local insurance firm were fruitless after he spends more days at floors trying to negotiate.
An Agritrade leaf Tobacco official said they are a contracting company, hence only finance and buy tobacco only from the contracted farmers.
“We make all necessary deductions from sales and pay the balance to the farmers” said the official anonymously.
Tobacco is Zimbabwe’s second largest foreign currency earner.
Production of tobacco is expected to increase by nearly 6 percent to 200 million kg compared to 189 million kg in 2017.
Zimbabwe largely exports the bulk of its tobacco to China with the rest going to South Africa, Belgium, United Arab Emirates, Indonesia, Sudan and Russia.
