In a proactive move addressing a dispute with Thai tobacco farmers as well as trying to foster better understanding by the farmers and the tobacco industry as a whole, Dr. Daonoi Suttiniphapunt revealed that in previous years TTM, who practices contract farming with about 17,000 tobacco growers in Thailand, has had to buy leaf that the farmers grew in excess of their quotas but TTM will not be continuing doing so any longer.
“TTM enters contract farming because tobacco farming in Thailand can only be done with permission from the Excise Department,” she said. “In the past farmers have tended to grow more than the quota they were allowed and TTM was forced to buy the excess amount of tobacco leaves as well, even though it exceeded the amount TTM needed to produce its cigarettes.
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“We aren’t trying to take advantage of our farmers, but simply trying to find a way where we can all move forward together and mutually benefit. We can’t buy excess leaf that exceeds our production demand, and we can’t buy excess leaf from last year as the quality would have decreased without the leaf being properly stored.”
TTM had previously announced that starting from the 2015/2016 crop it would no longer be buying leaf that were in excess of the quotas allocated to each farmer, causing much displeasure from the farmers who threatened to come together and stage a protest.
Farmers cur1rently earn THB2.7 billion from leaf sales: THB1.3 billion for Virginia, THB1 billion for Burley, and THB400 million for Turkish leaf.
Aside from helping provide technological know-how, teaching famers how to best grow their tobacco leaf, and guaranteeing the buying price, TTM also helps farmers by investing in building silos, warehouses, weirs and dams, even providing scholarships for their children.
“Each year we budget hundreds of millions of baht to help take care of our farmers, but at the same time there has also always been a demand that we must increase the level of our help by increasing the buying price. We have always done that, but in 2015 the price was increased by
THB26 and this year farmers are demanding THB28. If they were to sell their leaf to a private company, they would get THB90 but then they expect TTM to buy the same leaf for THB26 baht more. That isn’t fair to us, either.”
“We are a state enterprise and will encourage people to abide by the law. We just want people to understand that we aren’t buying excess leaf for the right reasons and we cannot just enable people to keep doing the wrong thing.”