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Relief Package to boost Tobacco Exports

The recent devastation caused by the Michaung cyclone in December 2023 severely impacted the tobacco crop of Andhra Pradesh and Karnataka. The heavy rains led to significant damage, including crop washing out, drowning, waterlogging, and wilting. Approximately 20% of the total planted area in affected regions suffered losses, posing challenges to tobacco farmers.

In response to the crisis, the Central government has announced a relief package aimed at boosting exports and alleviating the financial burden on tobacco farmers in Andhra Pradesh and Karnataka.

The relief measures include:

1.Interest-Free Loans in Andhra Pradesh:  The Government of India has approved interest-free loans of Rs. 10,000 from the Grower Welfare Fund of the Tobacco Board for affected grower members. This financial assistance is intended to support farmers whose crops were damaged due to the cyclonic rains. This one-time loan is specifically designated for the Andhra Pradesh Crop Season 2023-24 and will be recovered from the auction sale proceeds of the corresponding crop season.

2.Waiving of Penalties in Karnataka: n Karnataka, the Central government has decided to permit the sale of Tobacco on the Tobacco Board's auction platform. This decision comes with the waiver of penalties on the sale of excess production by registered growers and unauthorized production by unregistered growers specifically for the Karnataka Crop Season 2023-24.

Present Scenario and Export Demand: 

According to Mr. Raghunath Babu, Former Chairman of the Tobacco Board, Andhra Pradesh currently contributes to 200 million Kg of tobacco production, with approximately 40% of this used for domestic purposes. Besides, there is also significant export demand, particularly from European countries. The export demand has been further fueled by a decrease in production in Zimbabwe and Brazil attributed to climate change.

Price Trends: 

Presently, the price of tobacco for Best Quality stands at Rs. 280/kg, while Medium Quality tobacco is priced at Rs. 250/kg. These prices reflect the current market conditions and the quality differentials in the tobacco produce.

It is hoped that with this assistance, India will increase its market share of Tobacco in World market.

#ITC #Tobacco #Climate


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