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Until recently, Zimbabwe had experienced steady economic growth. GDP at 1990 constant price during 1996-1998 was 38 percent higher than that during 1985-1987. Due to variable weather conditions, agricultural production fluctuated year by year but its contribution to GDP remained around 17 percent for 1985-1998. In other word, agriculture has grown at a rate similar to that of the national economy.

Zimbabwe is one of the major tobacco exporters in the world. In 1996-1998, average annual exports of tobacco were 127 000 tonnes, of which Virginia accounted for more than 95 percent. Total exports of tobacco increased by 40 percent between 1981-1983 and 1996-1998. The average export revenue during the same period was US$7 875 million, and tobacco has been the largest single export crop in recent decades. Although the share of tobacco in total agricultural exports has declined from its peak of 78 percent in 1992, it still accounted for more than 55 percent of total agricultural exports during 1996-1998. Among other export crops, cotton and maize experienced significant growth in export revenue. Export earnings from cotton increased nearly 22-fold between 1981-1983 and 1996-1998, while maize increased by nearly 16 times during the same period, and sugar also saw its share in revenue increase sharply.

Increases in both planting areas and yields have contributed to a significant increase in output of tobacco over the past decades. Comparing the three-year average 1980-82 with 1998-2000, total output increased by 137 percent, from 95 817 tonnes to 226 970 tonnes. During the same period, planting areas increased from 50 150 ha to 92 685 ha, a rise of 85 percent, while yield increased by about 29 percent, from 1 900 kg/ha to 2 510 kg/ha (Table 7.1).

Large-scale commercial (LSC) farmers dominate tobacco production. LSC farmers are characterized by their use of modern machinery, overhead and drip-line irrigation, and permanent wage labour. Holdings in the LSC sector can be very large and it has been estimated that fewer than 5 000 farmers occupy 21 percent of Zimbabwe’s total land area of 8.2 million hectares, including 3.7 million hectares in Natural Region II. Less than 20 percent of all LSC farms are smaller than 200 ha and half are greater than 1 000 ha, although only a relatively small area may be suitable for cropping, and most LSC farmers cultivate between 100 and 500 ha per year. The majority of LSC farms are under freehold ownership by individuals, limited liability companies or large corporations.

Although there are fewer than 2 000 commercial tobacco growers, these producers account for 87 percent of area planted and 95 percent of the total crop, equal to some 190 000 to 230 000 tonnes of flue-cured tobacco annually. Furthermore, most commercial farmers have diverse sources of income. Although tobacco is still the backbone of commercial agriculture, other important LSC crops include wheat, soybean, maize, groundnut and livestock, which (in tobacco areas) are typically grown in rotation with tobacco. Most commercial tobacco farmers practice a five-year rotation, and these other crops are an important part of the overall land use system and help provide a steady cash flow. More recently, many commercial growers have also introduced other high-value crops, including export roses, supermarket vegetables, paprika and coffee as part of their farm system, specifically to lessen their dependence on tobacco. More than 80 percent of all horticultural exports, for example, are grown on tobacco farms and were first developed using tobacco revenue.

Table 7.1: Zimbabwe tobacco production area, yield and output, 1980-2000


Area harvested (ha)

Yield (kg/ha)

Production (tonne)


64 068

1 951.6

125 038


39 760

1 806.1

71 812


46 632

1 942.9

90 602


47 727

2 073.4

98 956


51 172

2 440.2

124 872


53 868

2 004.1

107 957


62 380

1 866.9

116 456


58 242

2 083.0

121 320


56 328

2 036.9

114 736


57 161

2 280.6

130 361


60 103

2 169.5

130 394


71 647

2 492.7

178 595


86 875

2 433.3

211 394


93 340

2 194.0

204 790


74 080

2 463.1

182 466


82 110

2 416.0

198 380


86 377

2 416.3

208 716


97 750

2 203.3

215 369


99 000

2 626.3

260 000


88 286

2 188.2

193 183


90 769

2 508.9

227 726

Small-scale commercial (SSC) farmers are loosely defined as indigenous commercial farms. These holdings were first developed by the Government of Rhodesia between 1931 and 1961 in an effort to reduce congestion in communal areas reserved for the indigenous population. There are about 9 000 holdings in the SSC sector, occupying a total of 1.2 million hectares. Half of these farms are under conditional freehold title, while others are under a long-term lease with an option to buy. Although not as advanced as LSC growers, most SSC farmers still produce at a reasonably high level and enjoy good access to basic equipment, including ox ploughs and carts, hand sprayers, sufficient barn space for curing tobacco, and baling equipment.

Smallholder farmers are only marginally involved in the tobacco sector. Although there are roughly eight times as many smallholder tobacco growers (about 16 000 in total) as commercial farmers, these account for less than 1.5 percent of all smallholder households. Certainly, the importance of tobacco as a high profit crop with fully developed market outlets cannot be overlooked, but it should also be noted that maize, cotton and groundnut are all more important for smallholder farmers in most locations. One of the biggest effects which any shrinking of tobacco markets would have on smallholder farmers is likely to be the loss of remittances from workers employed on large farms, rather than the direct effect on smallholder farm enterprise income. Finding suitable diversification options for smallholder tobacco growers is still a major challenge for Zimbabwe, but not on the scale of having to work with farmers in all locations.

Three main types of tobacco are grown in Zimbabwe, namely flue-cured, burley and oriental tobacco. Of these, flue-cured is by far the most important and is generally produced in the better rainfall areas to the north and east of Harare. The northern regions produce a Virginia type of tobacco, whereas growers in the east produce a thicker, slower developing type used for blended cigarettes. Burley tobacco is grown mainly in the northeast and in the Eastern Highlands and is predominately a smallholder crop. These areas have better rainfall and longer periods of the high relative humidity needed for curing. Oriental tobacco accounts for less than 1 percent of total output by mass and is grown mainly by small-scale producers in Masvingo Province. Details of flue-cured and burley production by farm sector for the past two years are given are given in 7.2.

Table 7.2: Tobacco production by sector (1999-2000)



No. of growers

Total area

Total harvest

No. of growers

Total area

Total harvest

Flue-cured tobacco


1 791

77 875

188 056

1 766

76 110

230 299



1 010



1 164

1 290


1 571

1 756

1 011

2 557

2 959

1 951


3 365

3 928

2 038

3 734

4 566

3 282









7 194

84 762

192 144

8 537

84 957

236 947

Burley tobacco



1 820

2 856


1 094

2 584









6 222

2 484

2 302

6 674

2 670

3 037


2 234

2 056

1 392

2 888

2 775

2 313









8 903

6 724

6 731

10 091

6 961

8 163

Key: LSC = large-scale commercial. SSC = small-scale commercial.
Source: Tobacco Industry Marketing Board (TIMB) data.


Zimbabwe is the largest producer of tobacco leaf in Africa and the world’s fourth-largest producer of flue-cured tobacco, after China, Brazil and the United States of America. Since cigarette production in Zimbabwe is on a small scale, the major activities in the tobacco industry are the growing, curing and subsequent handling and distribution of tobacco leaf. The country does not have a large tobacco manufacturing industry and produces only enough cigarettes to supply domestic demand and provide a relatively small volume for export. Therefore 98 percent of all tobacco production is exported.

Tobacco production makes an important contribution to GDP and to export revenue, and plays a major role in the national economy. The crop normally accounts for more than 50 percent of agricultural exports, 30 percent of total exports and nearly 10 percent of GDP. All tobacco grown in Zimbabwe is sold on the auction floors in Harare as unprocessed green leaf. In terms of revenue to farmers, total annual sales since 1990 have ranged between US$270 million and US$593 million. Tobacco sold through the auctions then undergoes further processing by merchant companies to remove stems and tips from the leaf, before being shipped abroad. This adds 30 percent to 50 percent to the crop’s final export value. In 1998, the total value of tobacco exports was roughly US$582 million.

Tobacco also plays a central role in many farm systems. Especially in the northern regions of the country, most commercial farm strategies (for both SSC and LSC sectors) begin with, and revolve around, tobacco. Other crops are grown in rotation with tobacco, either to generate cash or as food for on-farm consumption. Tobacco is one of the most profitable enterprises in commercial agriculture and the primary reason many commercial farms exist. Although other cash crops, including cotton and even maize, are more important for most communal and resettlement farmers, tobacco is still important and offers smallholder growers a unique opportunity for exceptionally high producer profits and excellent rates of return. Thus, tobacco production has provided an economic base for farmers to develop other production opportunities.

Tobacco production generates considerable rural employment. It was estimated that about 170 000 workers were engaged in tobacco production directly in 1998, in which large commercial tobacco farms hired about 117 000 long-term employees while 55 000 smallholder tobacco farmers operated largely on family labour. There were about 30 000 workers involved in tobacco research, marketing, service and manufacturing. In addition, short-term hirings by the large commercial farms and smallholder farms involved around 100 000 workers. Thus, full-time employment directly and indirectly would be around 250 000, roughly equal to 5 percent of Zimbabwe’s total labour force and perhaps 25 percent of formal employment. Many other jobs also depend on forward and backward linkages between tobacco and other parts of the economy, including input supply, transportation services, coal mining, hospitality during the auction season and other consumer services. To the extent that tobacco workers send remittances to family members on communal farms, the crop also helps to sustain agricultural production in these areas as well.

Tobacco is also an important source of government revenue. A levy system in which growers and buyers both pay a fixed percent on the value of crop sales generates several million dollars annually, as summarized in Table 7.3. To encourage production, the tax rates have been reduced each year since 1999. Based on the 2001 tax rate and a typical LSC yield of 2 500 kg/ha, flue-cured tobacco generates an estimated $Z 7 260 (US$132) in government revenue per hectare.

Table 7.3: Government tobacco levy.

Auction year

Tax Rate

Total Revenue

Total Revenue


5 + 5

43 553 989

429 486 819


5 + 5

43 236 859

492 759 409


5 + 5

37 248 464

750 248 172


5 + 5

33 455 822

1 272 750 774


2.5 + 2.5

18 400 000

862 500 000

Sources: Historical values from ZTA data.

Tobacco is an important source of income for both LSC and SSC farms and smallholder farms. In terms of local currency, the total auction value of tobacco leaf was $Z 13 000 million in 1999. Given the average gross profit rate of 37 percent in the same year, the total gross income for all tobacco farmers was $Z 4 800 million. It was estimated that the average gross income for each large size farm was about $Z 2.2 million and $Z 44 000 for every small-scale grower. On average, these incomes accounted for around 25 percent and 40 percent of total income for large farms and smallholders, respectively. If only cash income was taken into account, the share of tobacco would increase to more than 50 percent for smallholders.


Any effective global action to control smoking by measures such as restricting cigarette advertising and increasing cigarette taxes would eventually reduce demand for Zimbabwe’s exports of tobacco. Given the importance of tobacco exports for its economy, Zimbabwe would need to reduce its dependence on tobacco. In particular, several factors would be significant in the country’s ability to undertake a less painful adjustment away from tobacco production in the long term.

In fact, Zimbabwe has already moved into many new commodity export markets over the past few decades. For instance, it exported few cut flowers 20 years ago, but between 1980 and 1999 the total quantity of flower exports increased more than sixfold, from 2 900 tonnes to 18 200 tonnes, while export revenue rose from US$13 million to US$84 million. While prices of many agricultural commodities have tended to fall over the past decades, Zimbabwe has maintained its exports. For instance, cotton exports increased from 54 000 tonnes in 1981 to around 100 000 tonnes in 2000, while exports of tea and coffee doubled during the same period. Meat exports experienced the largest increase, from 2 600 tonnes in 1981 to 10 000 tonnes in 1998.

Although tobacco has an important role in the economy, at both national and sector levels, the Zimbabwean economy and agriculture are relatively diversified. Agriculture accounted for only some 18 percent of GDP in the past two decades, while the value of tobacco production accounted for less than 20 percent of the total value of agricultural outputs. Tobacco accounted for a significant share in the total value of agricultural exports, but its share has been declining over the past decade as exports of many other agricultural commodities have experienced rapid growth. As illustrated in Table 7.4, the growth of export revenue from tobacco was only 24 percent between 1991-93 and 1996-1998.

During the same period, however, total export revenue grew by 67 percent. The higher overall growth rate was driven largely by exports of horticultural products, including flowers, fruits and vegetables; coffee; cotton; textile fibres; and others, including various meats and sugar, which increased by 190, 370, 226, 216 and 179 percent, respectively. Their growth rates were far more rapid than tobacco. As a result, the share of tobacco exports in total agricultural export revenue dropped from 74 percent in 1991-93 to 55 percent in 1996-98. Cotton, textile fibres, horticultural products, meats and coffee saw their contribution to total agricultural export revenue increase significantly. These developments reflected the significant progress in diversification of agriculture in Zimbabwe. At the farm level, tobacco is rarely grown as a sole crop: most tobacco growers are well diversified.

Table 7.4: Major commodity exports (1991-1998)

Average exports

Growth between


Proportion in agricultural exports during 1991-93 (%)





Total agricultural exports


1 110.1








































Textile fibres






All others






Total Exports

1 563.9

2 168.0




Source: FAO data.

Diversified production reduces the exposure of growers to income variability in the face of variable tobacco prices. A diversified pattern of production also provides the technical possibility for tobacco growers to shift away from tobacco production to other crops immediately, because farmers have the skills, equipment and established marketing channels for producing other crops.

Large sized farms have dominated tobacco production in Zimbabwe. Average farm size was about 200 ha, of which an average of 40 ha were allocated to tobacco production. Most of these farms are organized and run as commercial enterprises. The managers of the large commercial farms are well trained and skilful in strategic planning, marketing and managing. They understand the market, know their own comparative advantages in the markets and what are the opportunities.

The major adjustment cost for these large tobacco growers in diversifying away from tobacco to other crops would be the fixed investment they have in constructions used for curing tobacco leaves. Other capital, such as trucks and tractors, can easily be used for other purposes.

Compared with these large tobacco growers, smallholders would have more difficulties in adjusting away from tobacco production, as they are more dependent on tobacco for their cash income.


Tobacco is important in Zimbabwe’s agriculture and the national economy. Since its tobacco production is almost entirely exported, global tobacco control, which would result in lower consumption of cigarettes, would lead to lower tobacco production. However, a diverse agricultural structure and the commercial nature of large tobacco farms would allow Zimbabwe to reduce its dependency on tobacco relatively easily. Various types of technical and financial assistance to small-scale tobacco growers would allow them to shift away from tobacco to other crops in the long run without any major reduction of income.

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