Tobacco Shortage Drives Farmer Sales Above Rates

The Pakistan Tobacco Company (PTC) has highlighted a shortage of more than 10.3 million tons of tobacco in the market, leading farmers to sell tobacco at prices ranging from Rs. 430 to Rs. 1,400 per kg, despite the official minimum price of Rs. 310 per kg. PTC representatives explained that cigarette factories set a target to buy 8.5 million kilos of tobacco from farmers but were only able to purchase seven million kilos due to bad weather and the tobacco shortage.

This shortage has resulted in farmers demanding higher prices for their tobacco, exceeding the official minimum price. As a result of increased tobacco prices, there has been a decline in Pakistan’s tobacco exports, affecting the target of domestic tobacco exports for the current year, which was set at 42 million kilos

The representatives also accused cigarette factories involved in tax evasion of increasing tobacco prices illegally by 350 percent, leading to concerns about the fairness of the tobacco purchasing process. They also noted that due to heavy tax increases on legal cigarettes, the market has seen an increase in the sale of illegal and smuggled cigarettes, impacting legal cigarette sales.

Also Read: Tobacco farmers warn against FED rise.

The representatives expressed the need for the track and trace system to be implemented across all cigarette factories without discrimination. They also raised concerns about the significant percentage of young boys in Pakistan who are reportedly smokers and mentioned the lack of data on female smokers due to restrictions on surveying women smokers.