JT Enters Leaf Trade

Source from:  Tobacco Reporter 06/15/2009

JT Group has concluded an agreement to acquire Tribac Leaf Ltd.'s business. A leaf tobacco merchant, Tribac operates in several parts of the world, including Malawi, Zambia, China and India. In addition, the JT Group will enter into a long-term agreement with Tribac for the supply of leaf tobacco from Zimbabwe. In a separate transaction, the JT Group has signed an agreement with U.S.-based leaf tobacco suppliers Hail & Cotton and J.E.B to form a joint venture company, JTI Leaf Services LLC (JTILS), for the procurement and processing of U.S. leaf tobacco. JTILS will supply directly contracted U.S. leaf tobacco, renown globally for its high quality and rich flavor characteristics, exclusively for the JT Group's needs. In a press note on its Web site, the JT Group said its actions would promote stability and capability in the procurement of high-quality leaf tobacco, allowing the company to grow its business in a sustainable manner. In the past few years, sharp price increases of various crops have caused leaf tobacco costs to stay high and induced volatility in the supply sources. JT Group said it would actively manage the leaf tobacco supply chain with an aim of stabilizing its sourcing; work more directly with tobacco growers to improve leaf tobacco quality, and enhance the group's talent pool and expertise in the area of leaf tobacco procurement. With the exception of the Japanese leaf, all other procurement for the JT Group will be continued by its Global Leaf Procurement Group based in Geneva. Tribac's organization will be integrated progressively into the Global Leaf Procurement Group, which will oversee JTILS' operations. Enditem