Around 64 million kgs of Virginia tobacco has been sold on the auction floors in Andhra Pradesh at an average price of Rs. 132 / kg. The actual production in the State is likely to be around 130 million kgs as against the authorized crop size of 136 million kgs (mkg) up till now according to the Tobacco Board sources.
Tobacco farmers in Andhra Pradesh are distressed over the low prices that their low-grade tobacco is fetching in the ongoing auctions. Thus they are demanding that trade should pay at least
Rs. 100/kg for such tobacco to support the farmers.
There is no surplus production, but the main cause for worry is that in the current season the output of low-grade tobacco is because of drought conditions and other factors in some of the tobacco-growing districts such as Nellore and Prakasam. The low-grade tobacco is fetching less than ₹100 a kg on the auction floors and farmers complain that they would incur heavy losses.
Low-grades constitute nearly 60-65 percent of the total tobacco produced in Nellore & Prakasam districts and therefore, even if the trade pays a fairly high price for the bright grades, it is not working out for the farmers.
In West Godavari district, where tobacco is grown in the northern light soils, roughly 20 mkg of tobacco has been sold at an average price of Rs.150 / kg. The tobacco grown in the district usually fetches the highest price.
The total production in West Godavari is expected to be around 45 million kgs. According to Tobacco Board officials, the auctions could go on for two more months as more than half the crop is yet to be sold.
