Tobacco Board Resolves Auction Row

Source from:  The Hindu 03/17/2009

New Delhi (PTI): Farmers sold about nine million kg of tobacco at auctions in Andhra Pradesh after the Tobacco Board resolved a dispute between producers and traders over the minimum price that halted the bidding for 10 days. "The dispute has been settled with the intervention of Board Chairman J Suresh Babu. The starting price for auctions of best-quality tobacco has been fixed at Rs 100 per kg, though in the northern region the price has been raised to Rs 105 a kg quality," a senior Board official said. As much as 9 million kg of tobacco has been sold since February 27 when the auction commenced, he said, adding that auction rates are currently ruling at the minimum price level. The dispute had arisen after tobacco buyers protested against "high" minimum bidding price of Rs 100 a kg and refrained from participating in the auction process, which was scheduled to start from February 17. However, with the intervention of the Board, traders agreed to take part in the bidding with the same starting price after halting the auction process for 10 days. "A starting price of Rs 100 per kg was set by the Board, which the traders were not willing to pay. The auction started on February 17. But buyers wanted the price to be fixed at Rs 90 a kg. So, the Board chairman interfered and traders agreed to the price of Rs 100 a kg," the official said. Enditem