Tobacco Asia

50 tobaccoasia LEAF NEWS 烟叶新闻 ZIMBABWE 2017 Output Promising Despite concerns that heavy rains could militate against a better yield, Zimba- bwe's tobacco output this year is projected at 200 million kilograms. Rodney Ambrose, c.e.o. of the Zimbabwe Tobacco Association, said the crop will perform notwithstanding the dangers of excessive rainfall and associated plant diseases. "We anticipate an estimated output of 200 (m.kg) depending on how long the wet spell will take. The rainfall can bring more diseases to the crop but I am sure farmers are trained to handle the situation," he said. "Eastern districts such as Macheke and Headlands area and some areas in Mashonaland West and Mashonaland Central have been experiencing a consistent wet spell." Ambrose also said he was optimistic the crop would attract a better price, saying lower quality leaf will attract a poorer price than middle and upper leaf crop whose prices will be predictably firm. Isheunesu Moyo, public relations manager for the Tobacco Industry and Marketing Board (TIMB) was reported to say that a shortage of ammonium nitrate fertilizer on the market was causing leaching of nutrients with some farmers losing their crop. "Excessive rains lead to leaching of nutrients, particularly nitrogen. The problem was exacerbated by shortage of ammonium nitrate on the market. The central bank has intervened by allocating foreign currency to fertilizer manufacturers and we hope the situation will get better. Farmers who did not make good ridges are losing crop due to sheet floods," Moyo said. TIMB statistics show that as of December 29, 2016, 164.5 m.kg of tobacco valued at US$933.6 million has been exported to various destinations across the globe. TIMB figures also show that as of January 5, 2017 tobacco area planted for the 2016/17 season stands at 91,805 hectares from 87,755 hectares last season. Gold Leaf Suffers Heavy Losses Gold Leaf Tobacco (GLT) suffered heavy losses of US$800,000 after being compelled to recall stocks from the market and destroy material after the Zimbabwean High Court barred the company from packaging and distribut- ing cigarettes bearing the RG brand. The High Court bar last September came a month after GLT unveiled the new brand on grounds it prejudiced competitors, Savannah Tobacco, which is licensed to manufacture the Remington Gold brand of cigarettes, also abbreviated as RG, locally. GLT has challenged the court decision, but re-launched its cigarettes as Rudland & George late January 2017 in Harare. "The greatest cost has been a disruption in business because we had to pull down our marketing communica- tion material, we had to pull down our product from the shops to comply with the court interdict," said GLT country manager Tanaka Matimber. "The bulk of it is the cost of the duties that we had paid on the cigarettes as we brought it into the country," he said. "The cost of rebranding and basically redesigning or packaging development and launching the product back on the market, so that's a huge cost and we are looking at over US$800,000 in terms of the investment that went down the drain." "We firmly believe we have to get back to business and focus on what we do best which we do best, which is selling cigarettes," he added. "We believe there is room for everyone to play in the market and we see ourselves growing very well in the next 12 to 18 months. We are here for the long haul (and) we are setting up to be the biggest supplier in southern Africa and the rest of Africa." Rudland & George cigarettes are cur- rently being produced in Johannesburg through GLT's sister company. How- ever, plans to start setting up a manufac- turing plant in Harare are underway. SRI LANKA Ceylon Tobacco Shuts Leaf Depots Ceylon Tobacco Company Plc. (CTC) announced that it will be closing its leaf depots in Anuradhapura and Sigiriya due to the impact of tax hikes, despite an increase in profits reported last year. CTC managing director and chief executive officer Michael Koest said, "It is no secret that the excise and VAT hikes in October and November last year, which led to a 43 percent price increase in legally manufactured cigarettes, had an impact on our business and manufactur- ing operations in Sri Lanka." The company announced in Decem- ber 2016 that it was considering the closure of four leaf depots, due to the drop in demand for tobacco leaf as a result of declining volumes. The closure of the two depots in Anuradhapura and Sigiriya mark the start of CTC winding down operations in these areas. Shutting down the two depots is estimated to impact the livelihoods of approximately 2,000 people depending on tobacco farming, and who stand to lose close to 200 million rupees in annual income. CTC also underwent a 20% head count reduction at the start of 2017 as a result of reducing one shift at its Colombo factory. CTC currently directly and indirectly employs over 46,000 people and supports around 300,000 livelihoods at various stages of operations from farming tobacco to the distribution and sale of its products, the company said. INDIA Energy-Efficient Barns Farmers in Chekurupadu have been able to drastically reduce their costs by switching to progressive energy-effi- cient barns. With a view to cutting down costs, improving quality, and increasing energy efficiency, the country's Tobacco Board has come up with subsidized schemes. Farmers save 25% on fuel during curing by using glass wool roof insulation and Venturi furnace insulation in their barns. The glass wool insulation costs Rs21,250 per barn, while the Venturi furnace insulation costs Rs20,000 each. One Chekurupadu farmer said, "We are able to save Rs9,000 on firewood per barn after adoption of the energy conservation measures. We go for seven curings per barn in a season. Now, we are able to save up to three tons on firewood alone."

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