Agriculture Minister P. Pulla Rao on Tuesday warned that errant tobacco manufacturers and traders would not be allowed to take part in auctions in the future.
After interacting with tobacco growers at the Ongole II auction platform here, the Minister blamed no bids and high rate rejections by the traders for farmers resorting to the extreme steps.
The trades reneged on their promises to purchase low grade tobacco between Rs. 62 to Rs. 67 per kg which they had made during a meeting chaired by Union Minister of State for Commerce Nirmala Sitharaman in Vijayawada in July.
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The farmers were offered only Rs. 40 to Rs. 45 per kg by manufacturers and traders for the low-grade varieties, he pointed out.
“Those not purchasing tobacco at the agreed prices will be banned from auction platforms in the future,” he asserted.
The Minister also asked Tobacco Board officials to stop auctions, if the traders kept rejecting produce on one pretext or the other and insisted that stringent action must be taken against the erring manufacturers and traders, after the farmers complained of a rejection rate of 8 per cent during the auction on Tuesday and no bids for some low-grade varieties.
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“The Chief Minister will take up with Ms. Sitharaman the demand for a compensation of Rs. 20 per kg for all low-grade produce in addition to F9, F10 and No Grade (NoG) varieties. We will sort out all pending issues, once Ms. Sitharaman returns from abroad,” he promised.
Meanwhile, Virginia Tobacco Growers Welfare Association State president Ch. Seshaiah wanted the government to do away with the penalty clause for growing tobacco beyond the permissible acreage and instruct the traders and cigarette manufacturers to come up with a minimum guaranteed price (MGP) ahead of the next cropping season. Given that tobacco farming is being discouraged by the Centre as a policy, it should offer ryots at least Rs. 9 lakh to dismantle their barns, he added.