The Hindu Business Line : Tobacco auctions going on well

Tobacco auctions have started on a positive note in Andhra Pradesh for a change this season and after a month-and-a-half 23 million kgs of crop has been sold till now at an average price of Rs 47 a kg.

The total authorised crop is 126 million kgs in the State and the actual production may be in the region of 140-145 million kgs.

The auctions in the State commenced on January 27 on some floors and by March 9 on all the 20 floors in the four soil regions.

They are continuing on all the floors without any hitch and the trade circles are exuding optimism with the export demand being good.

There are no carryover stocks with the trade and therefore, hopefully, the farmers may get a good price.

According to Mr P. Hariprasada Rao, the Chairman of the Polisetty Somasundaram group (a leading exporter) and the former chairman of the Indian Tobacco Association, the export prospects for the crop are bright in the immediate future.

"But we have to seize the opportunity, as the Zimbabwean crop has suffered terrible damage and the Chinese are also concentrating on high-end tobaccos. Many of the buyers are now looking to India," he said.

The auctions in Karnataka concluded and there was not much of a surplus in that State. A total of 82 million kgs of crop was sold at an average price of Rs 48 a kg in Karnataka. In the preceding season, 91-92 million kgs of crop was produced and sold at an average price of Rs 47.42.

"Due to climatic conditions, the weight of the crop has gone down, though the quality has improved in Karnataka. The crop has gone down by 10 million kgs or so in comparison with the last season," he said.

In view of the fall in Karnataka production and the favourable export scenario, the surplus in AP appears to be manageable this season.

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