Auction Sales on A Loop

Source from:  Tobacco Reporter 09/30/2011

Flue-cured auctions have become a year-round activity in India, but for how long will this situation last? According to a story in the latest issue of the BBM Bommidala Group newsletter, a week into this season's Karnataka sales, about 1.12 million kg of flue-cured had been sold for an average of Rs112.05 per kg, with the highest price paid hitting Rs125 per kg. At the same time, the newsletter reported that sales of the Andhra Pradesh crop were drawing to a close with 166.89 million kg of flue-cured having been sold for an average of about Rs89 per kg. Earlier this year, the Andhra sales started while the Karnataka sales were still going. But, as is indicated by the relatively low average price paid in Andhra, flue-cured is in oversupply at the moment and the Tobacco Board of India has been warning growers not to exceed the board's targets. The board is also revisiting the idea that growers should be compensated for getting out of flue-cured and encouraged to grow non-tobacco crops. Enditem