International companies begin buying surplus tobacco in Pakistan — Dawn
In the Pakistani city of Swabi, international tobacco companies have begun buying surplus tobacco from farmers. As Dawn reports, Pakistani companies had not yet started procurement at the time of publication for unknown reasons.
Procurement plan
Last week, representatives of purchasing companies, businesspeople and representatives of tobacco associations agreed at a meeting at the head office of the Pakistan Tobacco Board in Peshawar to buy a total of 47 million kg of surplus tobacco from producers.
Nasir Khan, secretary general of the Farmers Coordination Council, said that procurement was planned to begin on October 26 or 27, but was postponed by one day due to minor delays. According to him, Philip Morris International began procurement on October 27, while Pakistan Tobacco Company began on October 28.
Representatives of international and Pakistani companies said that Philip Morris International and Pakistan Tobacco Company are to purchase around 20 million kg of tobacco within the announced quotas. Pakistani companies are to procure the remaining volume, they said.
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Farmers’ demands and prices
Farmers’ associations demanded that companies announce quotas for the next year, conclude and honor agreements with producers, make payments through banks, and organize a tobacco exhibition in tobacco-growing regions rather than in Karachi.
Producer leaders said that companies stopped procurement on September 15, while the government remained silent for several weeks about the fate of the surplus crop, causing financial losses for farmers. Muhammad Ali Dagiwal, chairman of the Pakhtunkhwa Kashthkar Jirga, also accused representatives of the Pakistan Tobacco Board of supporting the companies’ position during meetings. He said that the federal Ministry of Food Security and the board must develop a strategy under which all national and international companies would buy tobacco in accordance with the tobacco marketing law.
According to representatives of tobacco companies, the minimum indicative price for surplus Virginia tobacco on the plains is 545 Pakistani rupees per kg, and 615.90 rupees in mountainous areas. Prices for other tobacco types were set at between 262.60 and 388.90 rupees per kg. Farmers fear that delayed procurement will allow companies to buy tobacco more cheaply later. Iqbal Shewa, chairman of the Kashthkar Ittehad Association, claims that producers have already lost 6.5 billion rupees due to low prices, while the procurement delay could cause them another 8 billion rupees in losses.
