The quality of leaf tobacco produced in China has continued to improve over recent years, contributing to increasing China's leaf tobacco export year-on-year.
In keeping with steady improvement of leaf tobacco quality, the structure of leaf tobacco exports has undergone changes, with leading leaf tobacco exports shifting onto medium- and high-grade products from low- and medium-grade ones. Meanwhile, the average price of leaf tobacco exports gradually rose to US$2,353/ton in 2008 from between US$1,000 and US$1,500/ton in 2000.
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Official statistics indicate that in 2008 the enterprises authorized to operate the leaf tobacco import and export trade in all tobacco-producing regions in China signed export contracts to the tune of 172,770.50 tons worth US$406.53 million, with the contractual export volume going up 12% year-on-year and with the annual amount of hard currency earned from leaf tobacco export rising 22% year-on-year.
The quality of leaf tobacco produced in China has continued to improve over recent years, contributing to increasing China's leaf tobacco export year-on-year.
In keeping with steady improvement of leaf tobacco quality, the structure of leaf tobacco exports has undergone changes, with leading leaf tobacco exports shifting onto medium- and high-grade products from low- and medium-grade ones. Meanwhile, the average price of leaf tobacco exports gradually rose to US$2,353/ton in 2008 from between US$1,000 and US$1,500/ton in 2000.
Official statistics indicate that in 2008 the enterprises authorized to operate the leaf tobacco import and export trade in all tobacco-producing regions in China signed export contracts to the tune of 172,770.50 tons worth US$406.53 million, with the contractual export volume going up 12% year-on-year and with the annual amount of hard currency earned from leaf tobacco export rising 22% year-on-year.
From 2001 to 2005, the tobacco industry of China exported an accumulated 670,000 tons of leaf tobacco, with an annual average export volume of 134,000 tons.
China is one of the leading leaf tobacco exporters in the world. Its annual leaf tobacco export volume ranks eighth globally. In particular, China's annual flue-cured leaf tobacco export volume ranks the fourth in the world. Of China's annual leaf tobacco exports, flue-cured tobacco accounts for 90%, with the rest being burley and oriental tobacco. Singapore, Britain, Malaysia and Hong Kong region are the main destinations of mainland tobacco exports.
Steady improvement
Over recent years, the State Tobacco Monopoly Administration (STMA) - the regulator of China's tobacco industry - has adhered to the policy of stabilizing the output and improving the quality of leaf tobacco products. As a result of government funding and technical support, and also from technical support extended by tobacco companies, the quality of leaf tobacco has significantly improved.
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In efforts to create favorable production conditions for the improvement of leaf tobacco quality, the tobacco industry has invested heavily in the construction of infrastructure facilities over recent years. By the end of 2008, the industry had invested a total of RMB20.48 billion (US$2.93 billion) in the construction of infrastructure facilities for leaf tobacco production and had made efforts to technically improve irrigation facilities for 19.77 million mu (1.318 million hectares) of tobacco-growing basic farmland. With the 5.79 million mu already equipped with irrigation facilities taken into account, the total area of tobacco-growing basic farmland with irrigation and drainage capacity in has now reached 25.56 million mu.
So far in 2009, the tobacco industry has earmarked RMB9.966 billion for exclusive investment in the construction of infrastructure facilities for tobacco production, an increase of RMB1.8 billion, or 22%, year-on-year.
Since the beginning of this year, the tobacco industry has funded the construction of 155,200 new intensive curing barns, 4,683.88 km of new tractor paths and 7,280.87 km of new irrigation ditches, further strengthening the comprehensive mutual support capacity of tobacco-growing regions and improving tobacco production infrastructure facilities.
Besides, the tobacco industry has actively made efforts to promote the development of a modern tobacco agriculture in China, and has been striving to improve the quality of leaf tobacco by enhancing organizational forms, information-based management systems and technological innovations.
Presently, the tobacco industry is making efforts to develop new organizational forms of leaf tobacco production on a trial basis, including big tobacco-growing farm households, family tobacco farms and specialized tobacco cooperatives in its projects.
Official statistics indicate that in 2009, a total of 41 townships in 3 counties across China are designated to fulfill pilot projects geared towards developing a modern tobacco agriculture, involving tobacco fields covering 965,000 mu (64,333 hectares), up 739,000 mu year-on-year. Of this area 52.59% is farmed by big tobacco-growing farm households, 13.65% by family tobacco farms and 19.9% by specialized tobacco cooperatives.
Over recent years, the tobacco industry, while strengthening the development of tobacco plantations by the unit, has realized tobacco growing on continuous plots, and has succeeded in effectively promoting the organization of production to a higher level. The specialized service system of the tobacco industry has become increasingly complete, with further progress made in tobacco seedlings development, mechanized farming, leaf tobacco curing, plant protection and so on. Today, the specialized service system is able to provide better specialized options for local tobacco growers.
The tobacco industry has achieved new breakthroughs in developing information-based management of leaf tobacco production. In this endeavor, it makes a full use of information-based means to strengthen contractual management and technical guidance and make specialized production facilities more automatic, promoting the greater development of a modern tobacco agriculture.
Over recent years, the tobacco industry has attached great importance to using innovative new technologies, including floating seedlings and applying fertilizer on the basis of soil testing, creating conditions for steady improvement of leaf tobacco quality. It was reported that so far in 2009, the area of tobacco fields with seedlings developed in floatation transplanted to them has accounted for 83.3% of the total tobacco acreage, up 8.7% year-on-year. The area of tobacco fields for commercial supply of seedlings has accounted for 93.7% of the total, up 15% year-on-year; and the rates of mechanized preparation of soil, ridge-forming and intertillage have reached 57.7%, 40.4% and 10.8%, respectively up 8.7%, 5.2% and 4.5% year-on-year.
In the first half of 2009, mechanized transplantation made its debut, with the area of tobacco fields using this method reaching 850,000 mu. The rate of intensive leaf tobacco curing is expected to reach 66.8% by the end of the year, up 20%. In the first six months, the area of tobacco fields covered by programs of unified prevention and control of plant diseases and pests accounted for 34.5% of the total, up 4.2% year-on-year.
Leaf tobacco exporting enterprises, have managed to improve their technological equipment, have additionally built workshops for hand selection of raw leaf tobacco and have installed pneumatic separation and extraction equipment to realize effectual selection of raw leaf tobacco. Using both hand selection and control by equipment which is good at trash extraction, they have succeeded in raising the degree of uniformity of leaf tobacco for export.
Strengthening international cooperation
In reality, continued growth in China's leaf tobacco export can to a great extent be attributed to cooperation with transnational tobacco companies. So far, some tobacco-producing regions in China have established close relations with Universal Leaf Tobacco (ULT) of the US, Alliance One International Inc. (AOI) and Philip Morris US (PM).
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In accordance with the orders placed by these transnational tobacco companies, the tobacco-producing regions concerned organize production and export of leaf tobacco while the transnational tobacco companies provide technical support and professional training in terms of operation and management of leaf tobacco production, implementation of Good Agricultural Practices (GAP), appearance quality targets for leaf tobacco, environmental awareness and so on, contributing to raising the output of leaf tobacco and improving the quality of products.
So far in 2009, the area of tobacco plantations in Luoping County in southwest China's tobacco-producing Yunnan province reserved for producing high-quality leaf tobacco for AOI has expanded to 5,000 mu. In 2008, the leaf tobacco grown in Luoping fully met the technical standards of foreign buyers in terms of the field growth vigor and all physical and chemical indexes, thanks to cooperation with transnational tobacco companies for many years. Since 2004, Luoping County has been in technological and trade cooperation with Dimon International Co., Ltd. (the predecessor of AOI).
Besides, Wuyi Tobacco Company in southeast China's Fujian province - a leading export-oriented strip processing base in China - has been in cooperation with PM for more than 10 years. Wuyi Tobacco Company (Wuyi) has fulfilled orders placed by PM for threshing and processing 50,000 dan (2,500 tons) of leaf tobacco to a high standard for three consecutive years since 2006. In 2008 alone, Wuyi fulfilled threshing and processing contracts for 15,000 dan of leaf tobacco for PM and 50,000 dan (2,500 tons) of leaf tobacco for Nanyang Brothers Tobacco Co., Ltd. and Indonesia's Gudang Garam Tobacco Company.
ULT has also been in extensive cooperation with major tobacco-producing regions in China. It intends to further increase tobacco imports from China. On June 2, 2009, a delegation from ULT went to Hubeikou Ethnic Hui Autonomous Township in central China's Hubei province to inspect tobacco growing there. When seeing that leaf tobacco was growing vigorously in the township, the delegation reached an agreement of intent with the township on the establishment of an export-oriented high-quality leaf tobacco production base with an area of 10,000 mu. Presently, the two sides are still holding negotiations leading to the signing of a formal agreement. So far, ULT has assigned two agronomists to be permanently stationed in Hubeikou to guide leaf tobacco production there.
Along with increasing improvement of the quality of leaf tobacco produced in China, Chinese-made leaf tobacco will be used for manufacturing cigarettes of more and more famous international brands. Enditem
