Sustainable Tobacco Farming: Not Just a Buzz Word

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Sustainable farming is today practiced with many agricultural commodities including tobacco. Tobacco Asia has inquired with international tobacco traders where sustainability measures are warranted, how they’re comprised, and what it takes to implement them.

By Thomas Schmid

Tobacco opponents frequently rile, huff, and puff at the mere mentioning of the phrase “sustainable tobacco farming”. They claim that it’s not much more than a hypocritical excuse concocted by tobacco merchants to justify the continued cultivation and trading of what critics label a “dangerous product”. But in fact the majority of tobacco merchants actually take the subject quite seriously. To them, sustainability is an important factor that runs through the entire supply chain and considerably contributes to their business success.

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“Sustainability is part of the Alliance One culture,” said Jose Maria Costa, executive vice president of global operations and supply chains at Alliance One International (AOI), one of the world’s largest leaf merchants active in practically all growing regions except the Caribbean. “Not only is it the right thing to do, it is [also] something that we must do in order to be successful – just like [with] any other agricultural commodity”.

The three foundation pillars

To accommodate this high concept, sustainability must begin at the grassroots level of the supply chain, the tobacco farmer. To develop an effective – and sensible – tobacco farming sustainability program, the industry adheres to the so-called “three pillars of sustainable tobacco production”: the people, the environment, the crop.

“These three pillars encompass particular areas of focus, for example, agricultural labor practices including child labor and forced labor, health and safety and workers’ rights, environmental awareness including soil and biodiversity preservation and erosion prevention, reforestation and natural regeneration, as well as crop integrity and management, among others,” explained Dr. Ian Duvenage, head of sustainable agriculture at Germany-based Contraf-Nicotex-Tobacco GmbH (CNT).

A multi-faceted subject

But Duvenage also cautioned that there is no single one-size-fits-all approach to sustainability. The subject, he said, has multiple facets depending on the growing region and tobacco origin, and any sustainability programs must be custom-designed to suit the situation at a particular location. While efforts in achieving sustainability have always been made in some shape or form, it would be misguided to implement a rigid, universally valid methodology that suits every growing region and its local farmers.

“The label ‘sustainability’ is easily thrown around,” said Duvenage. “But it is a complex multi-faceted subject that is organic in its own way of evolving and complementing different application areas. For example, if you take the efforts that are accorded to the correct use and application of CPA for residue levels, they complement the agricultural labor practices efforts on health and safety for farm workers.

Corroborating the hypothesis

Duvenage’s point of view, namely that sustainability measures in one area can complement the goals in another, is echoed by AOI’s Costa:  “While our sustainability programs are typically implemented with a primary objective in one pillar, we have found that there are often benefits in other pillars.”

To illustrate these inter-connected effects, Costa readily cited an example from Indonesia. There, AOI implemented numerous mechanization initiatives aimed at helping growers improve their efficiency and yield and, therefore, their profitability. But by introducing these initiatives, the company also was able to simultaneously reduce the likelihood of child labor as mechanization mitigated human labor needs. In other words: Better farming mechanization not only increased farm efficiency and yield (the “crop” pillar), but also decreased child labor and the overall human work hours needed to produce that crop (the “people” pillar).

“In 2015, our sustainable tobacco production initiatives eliminated more than 128,000 labor days,” claimed Costa. AOI also assisted Indonesian farmers in moving away from wood as a curing fuel. They are now using palm oil kernel shells (POKS) instead, which when compared to wood fuel resulted in growers saving $230 per ton of tobacco cured. The transition to POKS also spared an estimated 909,636 trees from being cut down for fuel. Once again this particular initiative had complementing effects on two pillars simultaneously, the “people” and the “environment”.

AOI: strategic sustainability engagement

As countries have shifted from auction markets to the integrated production system (IPS), a production model which establishes contractual relationships between tobacco buyers and farmers, AOI gained enhanced visibility into the grower base. This in turn allowed the company to strategically invest in sustainability programs wherever they are needed.

“For example, as [our] African origins have shifted from auction to IPS over the past several years, we have made significant investments in sustainability programs there,” said Costa. The positive effects of those investments are most tangible: By the end of 2008, AOI had directly contracted 600 growers through IPS. By 2016, that number had skyrocketed to 60,000. In 2008, these 60,000 growers produced 2.05 million kilograms (mkg) of tobacco and just 1.2 mkg of food. Through improved agricultural practices achieved by the company’s sustainability investments, they today not only produce 84 mkg of tobacco, but their food production also has skyrocketed to a staggering 86 mkg. As part of its sustainability programs in African countries, AOI since 2011 also planted 56 million surviving trees to counteract deforestation, built 241 boreholes and wells to ensure irrigation and provide a better drinking water supply and has renovated 26 schools in farming communities.

Education is key

The keys to successful implementation of AOI’s sustainability programs are continuous farmer education and farm monitoring, according to Costa: “Our farmer education program generally involves both group training programs and one-on-one training.” But as no two origins are alike, the exact approach must be customized to the needs and cultural traditions of each origin.

“In some areas of the world, we host day-long or multi-day events for farmers to come together with Alliance One technicians, fellow farmers and third-party experts to learn about topics such as CPA application, child labor prevention, farm safety, and financial literacy,” said Costa. “But in other areas, the trainings may be just a few hours long and topics will be related to specific mechanization initiatives. Where appropriate, we will encourage farmers to bring their wives to the trainings as the entire family may be involved in the farm operation.” During multiple farm visits throughout the growing season, AOI field technicians also monitor farmers for good agricultural practices (GAP) compliance and whether they adhere to the company’s agricultural labor practices (ALP) program.

“Whenever there is an instance of non-compliance, we work with the grower to understand the root cause of the issue and collaboratively develop a solution. Each visit is documented in Alliance One’s award-winning growers management system, which is an in-house software tool that the company uses to track trends among our growers and provide real-time visibility into our farmer base,” explained Costa.

Star Tobacco International: focus sub-Saharan Africa

Meanwhile, Turkey-based and Hong-Kong headquartered Star Tobacco International (STI) has put a particular focus on sustainable tobacco growing in sub-Saharan Africa, the region where the company is most active and from where it acquires the bulk of its merchandise. According to Dr. Iqbal Lambat, the group ceo, it is here where the company’s sustainability approach boils down to enhancing three core areas: GAP, improved crop management (ICM), and farmer economics. In 2013, STI launched an intensive tobacco sustainability program in Southern Africa under the acronym FEADES – “farmer empowerment, agricultural development, economic sustainability”.

“[FEADES] was undertaken with the Central Bank of COMESA towards using tobacco farmer sustainability as a catalyst for creating a ‘green revolution’ that would empower small-scale farmers in five of the key sub-Saharan African countries, namely Tanzania, Malawi, Uganda, Zambia, and Zimbabwe,” explained Lambat. Unfortunately, the implementation of FEADES has been temporarily delayed due to the troublesome havoc caused in the market by over- and under-supply fluctuations during the last two tobacco seasons of 2014 and 2015. But Lambat harbors high hopes that FEADES will be put into action within the next two years. The implementation model being considered is to create “cluster communities” – each comprising of 50 farmers and their families - to engage in the three sustainability core areas mentioned.

“This [implementation model] will allow for a more economical deployment of investment per community and a phased roll-out,” said Lambat. The FEADES project has already been presented to the tobacco marketing boards and tobacco farmer associations of the previously named five countries, including their ministries of agriculture.

CNT: covering the basics before long-term goals

Just like Star Tobacco, CNT also predominantly sources in Africa. In Zimbabwe, for example, the company has embarked on a number of sustainable forestry projects that have been warmly welcomed by local populations, as well as different government agencies, NGOs and numerous other impacted stakeholders.

“These projects continue to roll out through our growing [farming] communities,” said Duvenage. Parallel with reforestation, the viability of CNT’s contract growers are being improved through reductions in farming costs, as well as improved management techniques. However, the frequent absence of land tenure in Africa greatly hampers growers’ long-term planning, which negatively impacts sustainability initiatives. “Hence, the designs of our sustainability programs are determined by each distinctive community setting rather than a ‘one size fits all’ methodology. We have found the achievement lies in the detail,” Duvenage asserted. Addressing these sustainability basics is important to CNT, because it is difficult to discuss long-term goals with people who find current everyday survival a challenge. “But growers with confidence in their future are more likely to invest in further sustainability goals.”

Sustainability at all costs?

So, are sustainability initiatives categorically rammed down farmers’ throats by the tobacco merchants just because they think it’s the right thing to do? Not at all, according to STI’s Lambat. His company has extensively researched farmer sustainability in all major tobacco origins worldwide and reached the following conclusions: Firstly, sustainability matters only in countries with low disposable incomes and where tobacco is the prime cash-generating crop. Secondly, sustainability efforts only apply in countries where leaf merchant offtake is uncertain, for example in situations when tobacco sales are handled through auction systems and other sales channels rather than being contracted or guaranteed under contract. Thirdly, a lack of sustainability is actually often created by leaf merchants themselves in the form of single-year contracts, thereby denying the farmer the opportunity to plan his and his family’s livelihood farther ahead than just one growing season (i.e. one year).

On the basis of these conclusions, Lambat said, only countries in sub-Saharan Africa and a few countries in Asia qualify for sustainable tobacco farming initiatives. At the same time that would mean that the US, Europe, and South America are off the tobacco farmer sustainability map.

The tobacco ABC

Star Tobacco also believes that the so-called “Tobacco ABC” will become a reality in the next 10-15 years. “ABC” standing for Africa, Brazil, and China, these regions are expected to account for more than 80% of global tobacco leaf production within the stated time period.

“Crudely put, Brazil does no longer need a sustainability helping hand, and China’s state-run tobacco Industry is well taken care of as it already contributes slightly over 9% to the country’s GDP,” explained. Lambat. That leaves, at least as far as STI is concerned, only Africa – and sub-Saharan Africa in particular. “The region that [at present] most needs a sustainability pillar is sub-Saharan Africa, which can produce world class tobaccos far superior in quality to [those of] Asia, and where the sheer value of a sustainability-supported crop can indeed trigger an ‘African green revolution’,” he said. “Without going into detail, I think that can be done with irrigated and mechanized farms once the 12 weeks used to cultivate tobacco are over,” he said, referring to the possibility of utilizing now fallow fields for food production.