Poor show on the auction, the high stock price hit on tobacco products

Unsold stocks with traders became a curse for the tobacco growers in Andhra Pradesh this season. Traders do not actively participate in the auctions, and even if they do, prices are low, compared to those offered last season.
The sale, which began in the northern black soils in the eastern districts of the Godavari and the Hammam, the central black soils (CBS) in Krishna and Guntur districts and the northern light soils in West Godavari, feel good, but the product of the southern light soils (SLS) and southern chernozems in Prakasam district does not receive the expected price in this season.
Although tobacco was sold at the highest price of 120 rupees per kilo before, are now traded on the RTS 98-100 kg. This is of concern to producers, who blame tobacco council. Farmers claim that the Council could intervene when prices were falling. Instead, he was not present at the auction platforms, leaving traders to decide prices.
In accordance with the Tobacco Board, only 4120000 kg of tobacco was sold at auction a variety of platforms on March 23. Out of 3620000 kg was with SLS, who came from Prakasam district. Oddly enough, the farmers of this part of the state were on the warpath with the Council over the past season prices. The strike has forced the Council to intervene and negotiate with vendors to provide the best price.
“In addition, the decline of product quality, traders has huge reserves. We have served notice of traders to give us detailed information on available stock. We will decide as soon as we receive reports from them,” said Mr. Kamalavardhana Rao, chairman of the tobacco.
Asked about the intervention, Rao said that they are offering traders to explore export opportunities. “We are asking traders to visit the different markets in different countries for the export of tobacco. There are a number of countries, looking at the import and wholesale dealers to find those markets and to move their inventory. We will have a special interaction with the traders in the near future on this,” added Rao .
He expressed the hope that the producers would receive a higher price once traders get export orders.
Nevertheless, Virginia brand of cigarettes Manufacturers Association president and former MP, Yalamanchili Sivaji said that the council helped traders more than producers. He said traders were waiting for export orders, on the one hand, and the purchase of tobacco at the lowest price beyond the auction platform to another.
“Traders do not offer the best prices on the platforms, creating panic among the manufacturers. At the same time, they buy tobacco outside the auction platform, offering low prices. Committee continues to be a spectator in this game and traders dictate the terms of the Council,” said Shivaji.
He dismissed claims of unsold shares, and said, traders are waiting for manufacturers to keep their reserves at home to get the color of these and then buy the product at lower prices. “Traders take a few methods to rob the peasants,” he added.

Leave a Reply