The Hindu Business Line : Tobacco price rises to Rs 140 a kg in AP

Guntur, May 23 On an upward swing all the time, tobacco prices in Andhra Pradesh touched a new high of Rs 140 a kg on all the five auction floors in the northern lights soils of West Godavari on Friday, the highest price ever realised for the crop on the floors.

According to sources in the Tobacco Board, till Friday roughly 139 million kgs of tobacco had been sold in the State at an average price of Rs 80 a kg and the maximum price recorded was in West Godavari, with tobacco fetching Rs 140.40 a kg.

According to Mr Y. Sivaji, President of the Andhra Pradesh Tobacco Growers’ Association, the maximum prices could be realised on the floors in West Godavari district as the farmers remained united and thwarted the trade’s attempts to depress prices. “The system of ceiling prices has been abolished in West Godavari and in the case of two or more bidders bidding the same amount for a bale, the lottery system has been introduced. However, on the southern floors the system of fixing a ceiling price is being continued. It should be dispensed with,” he said.

On three auction floors in the State, the auctions have come to an end and at the present rate by June 15 or so the remaining tobacco (25-30 million kgs) may be sold off.

E-auction

On an experimental basis, the Tobacco Board is planning to introduce the electronic auction system. It is being introduced at Jangareddigudem in West Godavari in the first week of June. The Union Minister of State for Commerce, Mr Jairam Ramesh, is expected to inaugurate it. According to the Minister, e-auction is the solution to many of the gaps in the present system. It will address the deficiencies and result in better floor prices for farmers, he believes.

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