Andhra Tobacco Auctions Jump 18 Percent

Source from:  11 Aug, 2007, 0516 hrs IST,Raghu Krishnan, TNN 08/13/2007

BANGALORE: This year's auction of FCV (Flue-Cured Virginia and smoked in cigarettes) tobacco in Andhra Pradesh has concluded, with 171.9 million kg being transacted for an average realisation of Rs 47.47 per kg. The quantum auctioned was 18% higher than last year's 145.36 million kg. The average value was 2% higher than last year's per-kg realisation of Rs 46.33. Industry sources say this higher unit-value was achieved despite the appreciation of the rupee against the dollar. These sources add that thanks to road shows by the Tobacco Board and the trade in consuming countries, India was able to export almost 153 million kg of unmanufactured tobacco to the global market during 2006-07 at a cumulative value of Rs 1,241 core. The quantum exported was 7% higher than last year's 142 million kg. The value realised was 21% higher than last year's Rs 1,028 crore. AP and Karnataka are two major FCV tobacco-growing states. An estimated 60% of AP's crop and 80% of Karnataka's crop is exported. These sources add that while the AP farmers were generally happy with the prices realised, they were concerned about the Tobacco Board's penal charges for the production of unauthorised crop. Since tobacco is a regulated commodity, the crop-size for each year is fixed at a meeting of all stake-holders and government officials. As against an authorised crop of 150 million kg for the AP auction-season just concluded, farmers had produced 171.9 million kg. The Tobacco Board had collected about Rs 20 crore from AP growers by way of penalty for unauthorised crop sold in the auction. Enditem