Andhra prices increased

Flue-cured tobacco farmers in Andhra Pradesh, India, were paid an average price of Rs158 (US$2.43) per kg in the early part of the current selling season, up almost 48 percent on what they received last year, Rs107 per kg, according to a story in Hans India, relayed by the TMA.

But a question mark must hang over these figures if the 2016 average price quoted refers also to the early part of that season.

At the beginning of April last year, Ch. R. S Sarma reported for the Business Line that, by the end of March, after 25 days of sales, 5.85 million kg of flue-cured had been sold for an average price of Rs138.72 per kg, whereas, during the same period of 2015, 3.85 million kg had been sold for an average price of Rs118.09 per kg.

Not that the 2016 season went well. Sarma reported on a ‘crisis’ on the flue-cured tobacco market as auctions were disrupted on six floors by growers angry at the low prices being offered.

In part, the disruptions were caused by external forces as local manufacturers found themselves compelled to shut down their operations because of uncertainty over the government’s introduction of graphic health warnings on tobacco products.

Industry observers attributed the increase in prices in the current marketing season, which started on March 15, to rising demand for leaf tobacco in the face of a shrinking acreage.

Tobacco acreage was said to have declined in the current season as many tobacco farmers, who suffered heavy losses during last season, switched to chili cultivation.