Tobacco Asia

22 tobaccoasia Issue 6, 2022 November / December TA: What's the median price point currently? Khan: For hand stripped, it's almost US$4. TA: And previously? Khan: Previously it was in the range of US$3.30 to US$3.50. TA: How will this situation develop? Is it going to improve next year because farmers will plant more again? Khan: The farmers are of course very conscious about the present market shortage. So I believe that in the next season they will grow nothing but tobacco. But, they also have leverage now that prices are so high at present. They will tell you they want US$4 a kilo. And if you don't want to buy at that price, they'll say: "Okay, no problem, go away. I'll sell to somebody else – at US$4.20." But then again, I believe the next growing season is going to bring things back to normal. We will have a huge volume available next year. TA: Can you please say a little bit about your own company and its involvement in tobacco trading? Khan: Certainly. Malburo Tobacco International has business locations in Pakistan, Malaysia, and Indonesia, but our main office is located in Surabaya. We supply whole leaf, threshed leaf, rag, and blended tobacco. We export from Pakistan and Indonesia and import from the US, China, Brazil, and Zimbabwe. Zafer Atici, owner and managing director, Prestige Leaf. Zafer Atici, m.d., Prestige Leaf, Hong Kong TA: Zafer, you are specializing in oriental tobacco from Turkey. Tell me a bit about the situation in Turkey this year. Atici: Thank you for bringing up this question, because Turkish tobacco production has been a real problem over the past year, mainly because of bottlenecks in global supply chains. Turkish farmers couldn't get their fertilizers and other supplies at reasonable costs. For instance, fertilizer costs in Turkey went up 600% on average. And fuel oil went up by more than double. The second problem has been the climate. the summertime heat, with the highest ever countryside temperature at 47 degrees Celsius. TA: But tobacco crops are irrigated, are they not? Atici: Oriental requires almost no irrigation, but fields suffered nevertheless due to the enormous heat. So, farmers were rushing to rescue their crops and save what could be saved by harvesting prematurely, which of course reduced the yield. Harvest target for the main Turkish tobacco varieties this year was originally estimated at over 40,000 tons, but that has now been scaled down to only around 31,000-32,000 tons. It will be difficult for end product manufacturers to get their oriental orders filled. But these are not the only issues. TA: What are the others? Credit: Thomas Schmid

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