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Tobacco auctions come to a grinding halt
Tobacco auctions have come to a grinding halt in six auction platforms in the State, on Tuesday due to steep fall in price. The decision by cigarette manufacturing giants to reduce the purchase of tobacco has triggered the steep fall and the price of tobacco came down by 30 to 35 percent, halting auctions in Ongole, Tangutur, D C Palli, Kandkur, Jangareddygudem and Koyyalagudem auction centres.
Amaravati: Tobacco auctions have come to a grinding halt in six auction platforms in the State, on Tuesday due to steep fall in price. The decision by cigarette manufacturing giants to reduce the purchase of tobacco has triggered the steep fall and the price of tobacco came down by 30 to 35 percent, halting auctions in Ongole, Tangutur, D C Palli, Kandkur, Jangareddygudem and Koyyalagudem auction centres.
- Steep fall in prices by 35 percent is said to be the reason
- Cigarette giants reduced purchases, citing poor sales
According to tobacco board officials, the cigarette companies claimed that due to pictorial warnings on the packets, the cigarette sales have fallen, which led to reduced tobacco purchases. The farmers are expressing serious concerns over steep fall in price. They fear that they might have to endure heavy losses like last year, if the situation remains the same.
Even though various companies placed orders to purchase tobacco 120 million kg of tobacco, in the last one month, only 6 million kg has been sold. Despite placing orders before the tobacco board the cigarette manufacturing giants did not purchase as per the orders placed.
Speaking to The Hans India, Virginia Tobacco Growers’ Welfare Association honorary president Dr Yalamanchili Sivaji lamented that the crisis in the tobacco market has repeated this year too. “The big buyers, who placed huge orders are not purchasing stock to create crisis in the market,” he alleged stating that this unscrupulous tactic by the big buyers is wrecking the lives of the farmers.
Hitting out at cigarette companies, Sivaji charged that the companies did not stop sales despite pictorial warning on the cigarette packets and opined that it is better to suspended tobacco auctions until the crisis is solved. However, Indian Tobacco Association president M Uma Maheswara Rao expressed confidence that the auctions will resume soon. “Auctions will pick up after completion of auctions in Karnataka,” he added.
