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Industry regulators, the Tobacco Control Commission, said it froze sales in the Lilongwe, Blantyre and Mzuzu markets because of tensions between growers and merchants.
"It has the potential of hurting our economic projections for this calendar year," Finance Minister Goodall Gondwe told Reuters.
Industry officials blamed high prices for the troubles.
"These are the prices that are now hurting the markets because every farmer expects to sell their crop at prices recorded on the first day (of the season)," said Tim Kachitosi, spokesperson for Auction Holdings Limited, the country's sole tobacco auctioneers.
Congestion
"Every day this auction has the capacity of dealing with 10 000 bales of tobacco a day and suspension has meant that we have over 40 000 bales waiting to be sold and a congestion of trucks waiting to off load," he said.
In March, Malawi suspended a three-day-old tobacco auction after farmers withdrew their crop in protest against a drop in the market.
Prices were at record highs when the season opened last month. Farmers sold their crop at between $6 and $11 per kg - much higher than the minimum $2.20 set by the government.
The government has forecast 8% growth this year, slightly higher than the International Monetary Fund's (IMF) projection of 7.7% economic expansion.
Tobacco accounts for about 15% of the economy of Malawi, one of the world's poorest nations, and about 60 percent of its foreign-currency earnings. The country is one of the world's top 10 producers of tobacco.
- Reuters
