Tanzania cracks down on tobacco cartel exploiting farmers 

Dar es Salaam. Tanzanian minister for Agriculture, Hussein Bashe, has launched a robust crackdown on a criminal network exploiting tobacco farmers, as he seeks to dismantle illegal practices that have plagued the sub-sector for years.

Central to this effort is the recovery of Sh1.4 billion worth of packaging sacks, which were unlawfully resold rather than being returned to farmers as mandated after the delivery of tobacco to factories. 

The packaging sacks' recovery operation, which spanned the Tabora and Shinyanga regions, involved multiple state agencies, including the Prevention and Combating of Corruption Bureau (PCCB), Tanzania Police Force, Tanzania Intelligence Service (TIS), Regional Criminal Officers (RCO), and the Tanzania People’s Defence Forces (TPDF). 

Fifteen individuals have been arrested for their alleged involvement in the illegal sale of packaging materials, and Mr Bashe has suggested that they should face charges of economic sabotage.

Mr Bashe has also ordered the suspension of leaders from Agricultural Marketing Cooperative Societies (Amcos) and cooperative unions pending investigations. 

Furthermore, he directed company CEOs to assist in identifying those responsible for enabling the resale of the sacks and instructed the closure of warehouses facilitating the illegal trade. 

He also stressed that no deductions should be made from farmers’ payments for packaging materials during the 2024 tobacco trading season.

Speaking at a press conference in Tabora Town on December 29, 2024, Mr Bashe noted that tobacco packaging materials, known as ‘jafafa,’ belong to farmers and should be returned to them through the relevant Amcos after buyers deliver the produce to factories.

“It is theft to resell the sacks to farmers who should receive them back [for free] as their own property,” he added. 

The crackdown has exposed how traders, cooperative leaders, and politicians colluded to exploit farmers by reselling sacks at inflated prices of up to $4 each.

Despite a system designed to make it easier to return the packaging materials back to farmers for reuse in the following harvesting season, the cartel has been diverting them for illegal resale, depriving farmers of their rightful property. 

In this system, sacks are marked with farmers' names and Amcos details.

He revealed that tobacco farmers in key growing regions have been spending between $5 million and $7 million annually on imported packaging materials.

He added that farmers incur an additional cost of one kilogramme per sack to cover the price of packaging materials.

He questioned the Tanzania Tobacco Board (TTB) and the Tanzania Cooperative Development Commission (TCDC) about the whereabouts of the sacks used in previous seasons.

“If 100,000 sacks were used last season, only 20,000 should be imported this season, as the rest should come from recycled materials,” he said, adding that the sacks can be recycled for up to three consecutive seasons. 

Phase two of the crackdown 

Minister Bashe also unveiled plans for the second phase of the operation, which will expand investigations to Katavi, Mbeya and Kigoma regions.

This phase will focus on cooperative leaders who have reportedly exploited farmers by inflating loan amounts for sack procurement. 

“We have discovered that cooperative leaders, who approve loans for farmers, have been inflating the amounts for personal gain, resulting in further deductions for the farmers,” he said. 

The investigation will compare what farmers requested, the amounts approved by Amcos, and the final sums issued by financial institutions.

By addressing these discrepancies, the government aims to root out corrupt practices and ensure greater accountability within the tobacco sector. 

Rising tobacco production and revenue 

The crackdown comes as Tanzania’s tobacco production continues to rise, reaching 122,858 tonnes in the 2023/2024 season, up from 50,000 tonnes previously.

Tobacco exports have generated $316 million as of December 2023, with the government aiming for $400 million by the end of the season. 

Looking ahead, the government has set ambitious production targets of 200,000 tonnes for the 2024/2025 season and 300,000 tonnes by 2025/2026.