Tobacco Asia

58 tobaccoasia LEAF NEWS 烟叶新闻 without charging interest. The company has also moved its purchasing season forward from September to July, allowing growers to receive payment two months earlier than in previous years. Seongheon Jung, head of purchasing operations at KT&G, said farmers continue to face mounting cost pressures. "Farmers are facing increasing difficulties due to the burden of fuel costs caused by the recent Middle East crisis and high labor costs," Jung said. "We will continue our efforts for mutual growth with our key partners, the tobacco leaf farmers, through ongoing win-win initiatives." India Tobacco Exports Slide A combination of global oversupply, rising logistics costs, higher taxation, and geopolitical tensions has weighed on India's flue-cured virginia (FCV) tobacco sector, contributing to a sharp decline in exports and weaker market conditions for growers in Andhra Pradesh. Yarlagadda Ankamma Chowdary, secretary of the Indian Tobacco Association, said India's tobacco exports fell significantly over the past year. According to industry data, export value declined from INR16.9 billion (US$198 million) in April 2025 to INR11.02 billion (US$129 million) in April 2026, a drop of 34.81%. Speaking to The Hindu, Chowdary attributed the decline to a combination of factors, including surplus production in major tobacco-growing countries, increased freight costs, higher taxes, and uncertainty linked to tensions involving Israel, the US, and Iran. He said Andhra Pradesh farmers produced substantially more tobacco than the volume authorized by the Tobacco Board. While the board approved production of 142 million kilograms of FCV tobacco for the 2025-26 crop year, growers harvested more than 230 million kilograms. At the same time, tobacco-producing countries around the world also generated surplus volumes, increasing global availabil- ity and reducing export demand. India exports about 70% of its FCV tobacco production, with the remaining 30% sold domesti- cally, according to Chowdary. The domestic market has also come under pressure following new taxes introduced by the central government on February 1, 2026, he said. Chowdary noted that the government classifies tobacco as a demerit crop and therefore does not provide export incentives to the sector. He said the absence of export support has made it more difficult for Indian suppliers to compete with international rivals in overseas markets. Market conditions have also affected prices at FCV tobacco auction platforms in Andhra Pradesh. Chowdary said buyers have been unable to offer the higher prices seen in previous seasons, disappointing many growers. As a result, some farmers have chosen not to bring their tobacco to auction, believing current prices do not provide adequate returns. Malawi Targets Tobacco Quality Issues Malawi's Tobacco Commission (TC) stepped up enforcement efforts aimed at improving tobacco quality, warning growers over poor handling practices that continue to contribute to lower prices and rising rejection rates at auction floors. Speaking during a meeting with the Media Network on Tobacco in Lilongwe, TC public relations officer Telephorus Chigwenembe said some farmers continue to undermine leaf quality through practices such as mixing grades, altering water to increase weight, and other forms of product manipulation. He said these actions violate the Tobacco Industry Act of 2019 and damage confidence in Malawi's tobacco among buyers. "The law is very clear. Farmers must stop mixing grades, tampering with moisture levels, and engaging in practices that compromise tobacco quality," Chigwenembe said. He also stressed that maintaining competitiveness in international markets requires improvements in grading, curing, and overall profession- alism. Officials have urged growers to prioritize quality as the marketing season progresses. The warning comes as many farmers express frustration over lower prices and a growing number of rejected bales at auction floors. However, governance and economic commentator Dr. Ben Dzolowere argued that some of the challenges stem from farmers "self-inflicted losses caused by poor grading and careless handling practices." "There is no need for farmers to behave like crying babies. They complain that prices are dead and buyers are rejecting tobacco, yet the quality they bring to the market is poor," Dzolowere said. Dzolowere accused some growers of mixing different leaf qualities and concealing defects such as mold, practices that can reduce buyer confidence and affect market perfor- mance. He emphasized that while growers cannot control international market prices, they can influence the quality of tobacco they present for sale. "Price is determined by the market, but grade is determined by the farmer. You may not control global prices, but you fully control what you bring to the auction floor," he said. "Crying costs farmers more than bad weather. Time spent complaining should be spent sorting tobacco properly, managing moisture, and improving bale consistency. Buyers reward professionalism and consistency — not excuses," he added. TC has expanded awareness and training initiatives to encourage better handling and preparation practices. Industry stakeholders say stronger grading standards and improved curing methods could help reduce rejections, strengthen buyer confidence and improve returns for growers over the long term. Malawi's Tobacco Commission has expanded training and awareness programs to improve tobacco handling and preparation, with industry stakeholders saying better grading and curing practices could reduce rejections, boost buyer confidence, and enhance grower returns. Credit: Papphase, CC3.0.

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