Coffee at 88% of target, sugar at 59%, tobacco at 93%. Three crops with similar histories, very different current trajectories — and three distinct policy responses in the FY 2026/27 budget.
Coffee, sugar and tobacco have been Tanzanian cash crops for as long as Tanzania has existed as an independent country. They share a colonial legacy, a smallholder-anchored production structure, and a chronic dependence on global commodity prices that the country cannot directly control. They are also, in 2025/26, in three quite different conditions. Coffee is recovering. Sugar is well short of target. Tobacco is close to target with smaller political headwinds. The Hotuba treats each separately, and so should this article.
Coffee: 88% of target, 112 new young extension officers
Tanzania produced 74,663.60 tons of clean coffee in 2025/26 — 88% of the 85,000-ton target. Coffee production has been steadily rising in recent years, supported by replanting programmes in the highland zones, extension service intensification, and a renewed focus on quality grading that allows Tanzanian coffee to fetch better prices in international specialty-coffee markets.
The Coffee Board hired 112 young extension officers under BBT-Ugani in FY 2025/26 — the smallest commodity-board cohort, but covering the most geographically diverse production base. Tanzanian coffee is grown in Kagera, Kilimanjaro, Arusha, Mbeya, Songwe, Ruvuma, Kigoma, and a handful of other areas. Each zone has different agro-ecological characteristics, different varietal traditions, and different value-chain configurations. 112 specialised extension officers spread across that diversity is significantly better than the previous extension density, even if it remains insufficient for full coverage.
The path from 88% to 100% target achievement in coffee runs through three workstreams. The first is the continued replanting of older orchards with higher-yielding varieties, particularly in Kagera and Kilimanjaro where many coffee trees are decades old. The second is the integration of climate-resilient varieties from TARI’s research portfolio. The third is the price-and-quality work led by the Coffee Board to ensure that Tanzanian coffee reaches the specialty-grade markets where premium pricing is possible.
Sugar: 59% of target, the structural challenge
Sugar production in Tanzania reached 410,979 tons in 2025/26 against a target of 700,000 — 59% of plan. The sugar shortfall is the most significant gap-to-target among Tanzania’s major commodity crops, and it has a different character than the cotton shortfall.
Sugar in Tanzania is produced largely on integrated estates with attached factories, plus a meaningful smallholder out-grower component. Production capacity is limited by sugarcane availability (which depends on land area, rainfall and irrigation) and by sugar-mill processing capacity (which depends on factory operations). Both bottlenecks have been visible in recent seasons. Some mills have operated below capacity because cane availability was constrained. Some cane has not been processed because mill capacity was the constraint. Aligning these two is a multi-year coordination challenge.
The Hotuba reports continued investment in the Kidatu National Sugar College — a new dormitory is under construction — which will train technicians and operators for the sugar industry. This is a long-term human-capital investment that will support sector recovery, but it will not deliver the missing 290,000 tons in a single fiscal year. Sugar is a crop where the closing of the target gap will require structural investment over multiple years rather than a single annual recovery.
Tobacco: 93% of target, a quieter recovery
Tobacco production in Tanzania reached 185,776 tons in 2025/26 against a target of 200,000 — 93% of plan. Tobacco is geographically concentrated in Tabora, Kigoma and the western zones, and is anchored by a relatively well-organised set of cooperatives, farmer associations, and processing companies.
The 93% target achievement is structurally significant. Tobacco has faced sustained headwinds globally as anti-tobacco public-health policies have reduced consumer demand in many markets. Many tobacco-producing countries have seen production decline. Tanzania has held its production levels reasonably stable through this period — partly because Tanzanian tobacco serves diverse export markets, partly because the cooperative-anchored production model has provided farmers with relatively stable price expectations.
The TARI tobacco research programme covered in the Hotuba is examining the cost differentials between flue-cured, smoke-cured, air-cured and sun-cured production approaches — an unusual research focus that reflects the practical economics of farmer-level tobacco production. Each curing method has different fuel requirements, labour demands, and quality outcomes, and matching the right method to the right farmer’s circumstances can materially affect production economics.
Three crops, three policy responses
The Hotuba’s differentiated treatment of these three crops reflects the underlying differences in their conditions. Coffee gets sustained replanting investment, varietal upgrade focus and quality-tier promotion. Sugar gets training-college investment and incremental capacity-alignment work, with the implicit acknowledgement that fast recovery is unlikely. Tobacco gets continued research investment and operational stability rather than dramatic intervention.
This kind of crop-specific calibration is what good agricultural policy looks like. A one-size-fits-all approach that applied the same intervention model to coffee, sugar and tobacco would produce poor outcomes in at least two of the three. The Ministry’s willingness to treat each crop on its own terms, with policy tools matched to the structural conditions of each, is one of the less-visible strengths of the FY 2026/27 budget.
“Kila zao linahitaji mkakati wake unaolingana na hali yake. Hii ndiyo sababu Wizara inafanya kazi kwa karibu na bodi za mazao kwa ajili ya kuandaa mipango maalumu kwa kila mazao.”
— Hon. Daniel Godfrey Chongolo (MB), Waziri wa Kilimo, Hotuba ya Bajeti FY 2026/2027 (editorial composite reflecting commodity-by-commodity treatment)
What 2026/27 will tell us
By the close of FY 2026/27, three indicators will be worth tracking. Coffee should move closer to its 85,000-ton target as replanting investments mature; whether the quality grading and specialty-market positioning is also progressing matters as much as the volume. Sugar will likely show only marginal year-on-year improvement, with the deeper recovery still several years away; the metric to watch is mill capacity utilisation rather than total tons. Tobacco should hold close to target, with the more interesting question being how the curing-method research is shifting on-farm economics in the western zones.
These three crops have provided Tanzania with foreign exchange, rural employment, and cash-economy entry points for generations of smallholders. They are also each in a different phase of their long-cycle trajectory. The FY 2026/27 budget treats them with the differentiation they require — and that, in itself, is a sign that Tanzanian commodity-crop policy is becoming more sophisticated.