India
Efforts are underway to promote exports to explore new markets and to retrieve old markets that India has lost out on, which promises to help India’s tobacco trade. As part of these efforts, restrictions on foreign companies’ participation in tobacco related activities have now been lifted and the companies will also be permitted to set up offices in Guntur, the tobacco center of the country. India will also start participating in tobacco auctions and leaf processes.
The Tobacco Board of India has held meetings with traders, growers and other stakeholders to discuss issues confronting the tobacco trade. Union minister of state for commerce and industry, Nirmala Sitharaman, who presided over the meeting, assured that tobacco would be purchased by traders within a price band that would be based on five years’ average prices, according to K. Gopal, the board chairman.
Average prices this year are lower than last year and exports are slow due to delayed orders because of excess carryover stocks and excess production globally.
Tobacco farmers say they are witnessing lukewarm response in the ongoing auctions with only 46.5 m. kg of tobacco purchased by the end of June, or less than 50% of last year’s year-on-year sales.
Gopal said traders have now agreed to purchase the entire authorised crop of 172 m. kg in all regions, to be completed by end of September. The traders agreed to pay Rs 109-114 (US$ 1.67-1.74) per kg for the traditional bright variety, Rs 97-102 for medium variety and Rs 62-67 for low-grade tobacco.
They also agreed to pay Rs 127 per kg for NLS bright grade and Rs 113 for medium grade. However, no indicative price has been given for the low grades. It was also decided that all would abide by the crop size and quality standards, Gopal stressed.