Tobacco growers in Karnataka say ‘cheers’

Laiqh A Khan

Prices of commodity reach an unprecedented Rs. 156.8 a kg

Last year, farmers sold tobacco at an average price of Rs. 59.63 a kg

Growers likely to mop up more than Rs 1,000 crore this season

BANGALORE: Tobacco growers in Karnataka never had it so good. Having sold an estimated 90 million kg of tobacco at an average price of Rs 110.8 a kg since the last five months, the estimated 40,000 tobacco farmers of the State are well poised to cumulatively earn more than Rs. 1,000 crore this auction season.

The record earnings came about after the prices of the commodity reached an unprecedented high touching as high as Rs. 156.8 a kg, riding on a rising global demand and declining world output. “The farmers have already sold tobacco worth Rs. 990 crore. They will surely surpass the Rs. 1,000-crore mark by the time the remaining 15 million kg of tobacco is exhausted in the next fortnight,” said Aziz Ul Haq, regional manager of Tobacco Board, Mysore.

The tobacco farmers of Karnataka, who earned Rs. 515 crore last year, would be more than doubling their income this year as total transactions could well reach the Rs. 1,110 crore, almost Rs 600 crore more than last year.

Ironically, tobacco cultivation is fetching the farmers of the State rich dividends at a time when almost every other industry is suffering huge losses owing to global slowdown. A good 80 per cent of the Flue Cured Variety (FCV) of tobacco grown in Karnataka is exported abroad to meet the demand of multinational cigarette manufacturing companies.

Last year, Karnataka’s farmers sold 87 million kg at an average price of Rs. 59.63 per kg. But, the this season, the average price of the commodity had increased by almost 90 per cent and is ruling at an all-time-high Rs. 110 a kg, beating the previous high of Rs. 84.85 a kg recorded during the 2008 auctions in Andhra Pradesh.

A majority of the tobacco farmers in Karnataka are concentrated in Periyapatna, K.R. Nagar, Hunsur and H.D. Kote taluks of Mysore district.

The unprecedented price has been attributed to the shortfall in tobacco producing countries including Zimbabwe, forcing the multinational cigarette manufacturers to make a beeline to the 10 auction platforms set up by the Tobacco Board across the State.

The virtual windfall for the tobacco farmers of the State comes at a time when the Tobacco Board has come out with an attractive package for surrender of tobacco cultivation licences in line with the World Health Organization-sponsored Framework Convention for Tobacco Control (FCTC) to which India is a signatory. The FCTC proposes to halve tobacco cultivation by 2020.

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