Tobacco Asia

Volume 19, Number 2

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62 tobaccoasia / Issue 2, 2015 (May/June) dryer and hotter situations than other tobacco types can. "The people of the area liked the results, and it was observed that after three years, there was a net in-migration of population, attributable to to- bacco growing," he said. "They had a crop they could grow profitably, and they grew it. For now, we expect to continue to contract it. At the cost we can produce it for there and with the qual- ity they can produce, it has a place in the current Oriental market." AOI India also partners with various organiza- tions to make an impact on the living conditions of farmers such as providing infrastructure for safe drinking water, building primary health centers and helping to meet the educational needs of those in their farming regions. GAP education helps improve farmer profit- ability and minimize environmental impact. In Thailand, Alliance One and its partners have been working with the farming communities since the 1960s and have been instrumental in the mod- ernization of the Thai tobacco industry. Due to ongoing GAP education and the implementation of select hybrid varieties, both yield and return to AOI farmers has been vastly improved. Also, through a financing program in the late 1990s all of the company's local suppliers' FCV curing barns have been upgraded to modern au- tomated bulk curing facilities. This led to reduc- tion in fuel usage of up to 60% and enabled the utilization of renewable fuels, thus improving the income for the farmer while significantly reducing the impact on the environment. Recent news: AOI to help PMI in Brazil, USA Beginning with the 2016 crop, AOI will provide Brazilian burley leaf tobacco to Philip Morris In- ternational (PMI) through the company's subsid- iary Alliance One Brasil Exportadora de Tabacos (AOB). This comes as part of PMIMSA's new leaf supply arrangement in Brazil. Previously, Philip Morris Brasil directly contracted and purchased a portion of its burley tobacco requirements from Brazilian growers. In the new arrangement, PMI will purchase its processed burley tobacco require- ments directly from AOB. This arrangement is expected to provide en- hanced supply chain efficiencies while reducing sourcing complexity, according to the company. It reflects PMI's and AOI's commitment to Bra- zilian growers and their communities as well as PMI's intent to remain a major purchaser of Bra- zilian tobacco. "The sustainability of our grower communi- ties is vital to the success of Alliance One and our customers, and we are excited to further support the tobacco supply chain in Brazil through this new leaf supply arrangement," said Sikkel. "From working with farmers during the growing season through processing and delivery, we focus on pro- viding customers with a high-quality product that is produced in a compliant manner. Including its predecessor companies, AOI has operated in Brazil for over 60 years. Earlier, AOI was selected as one of two leaf dealers chosen to supply US tobacco to PMI as part of that company's decision to transition from direct contracting and purchasing of tobacco from US growers to sourcing its US tobacco require- ments from AOI and Universal. At the time, Herbert Weatherford, AOI's re- gional director for North and Central America, said, "We remain proudly committed to our cur- rent, well-established US grower partners and look forward to working with a new grower base as well as other service providers. The broader grower base (provided in the agreement) better positions Alliance One to expand the availability of US and Canadian tobacco to domestic and international markets." Alliance One-contracted tobacco plantation in China POKS furnace in Indonesia

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