Malawi’s tobacco export revenues rose sharply in the latest selling season, even as prices weakened due to oversupply, underscoring the crop’s continued importance to the country’s economy.
Data from the Malawi Tobacco Commission showed earnings increased by 37 percent to US$540 million in 2025, up from US$394 million the previous year.
The surge was driven primarily by higher volumes rather than stronger prices.
Volumes offset price decline
Tobacco sales volumes climbed significantly to over 221 million kilograms, compared with 133 million kg in the previous season, which runs from April to August.
However, average prices fell to US$2.45 per kg, down from US$2.98 in 2024, reflecting a market where supply outpaced demand.
Malawi is one of the world’s largest producers of burley tobacco, and the crop remains its largest source of foreign exchange earnings.
Industry officials said the imbalance between supply and buyer demand is likely to persist.
Oversupply concerns continue
For the upcoming 2026 season, output is projected at around 197 million kg, while demand is estimated at about 170 million kg, suggesting continued downward pressure on prices.
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The 2026 marketing season is set to open on April 20.
Economic reliance on tobacco
The performance of the tobacco sector is closely tied to Malawi’s broader economic stability.
The country remains heavily dependent on agricultural exports and external support, making fluctuations in tobacco earnings particularly significant for foreign exchange availability.
President Peter Mutharika is seeking to stabilise the economy following his re-election, with the government pursuing a new programme with the International Monetary Fund and working to restructure both domestic and external debt.
Pressure to diversify
While higher volumes have boosted revenues in the short term, the continued decline in prices highlights the risks of overreliance on a single commodity.
Analysts say Malawi faces increasing pressure to diversify its export base and reduce vulnerability to global commodity cycles, even as tobacco remains central to its economy.
