The Flue Cured Virginia (FCV) tobacco auctions in Karnataka for the crop season 2023-24 concluded on Saturday with the marketing of 88.86 million kg at an average price of ₹257.46 per kg.
The average prices during the year were not only higher by ₹29.45 per kg when compared to the average price of ₹228.01 last year, but also reveal that the average prices of tobacco had more than doubled during the last nine years from an average price of ₹107.49 realised during the year 2014-15.
Much of the FCV tobacco grown in Karnataka, mostly in Mysuru and parts of Hassan district, is export quality tobacco. The Tobacco Board has attributed the rise in average prices of tobacco over the last year to “buoyant market conditions”.
The average price of tobacco has more than doubled during the last nine years even as anti-tobacco activists have been campaigning against cultivation of tobacco on account of the health hazards its consumption poses. The anti-tobacco campaigners have been urging the government and the tobacco growers to shift to alternative crops.
Though a crop size of 100 million kg had been fixed for the year 2023-24, a total of 88.86 million kg of tobacco was marketed during the auctions for the year, which had commenced on September 25, 2023.
While the average price for the year was ₹257.46 per kg, the highest bid realised during the auction went up to ₹290 per kg. The average price for bright grade tobacco stood at ₹269.3 per kg while medium grade tobacco fetched ₹ 259.2 per kg during the auctions. The low-grade tobacco fetched a price of ₹238.7 per kg.
“Overall, the prices during this year were higher by ₹29.45 per kg when compared to the previous year due to buoyant market conditions,” said G. Bulli Subba Rao, Regional Manager of Tobacco Board, Mysuru, in a statement here.
About nine years ago, during the crop season 2014-15, Tobacco Board data shows that 103.4 million kg was marketed and the average price realised during the year was ₹107.49 per kg. Subsequently, during the year 2015-16, a total of 71.95 million kg of tobacco was sold for an average price of ₹135 per kg.
The average prices of tobacco had registered a gradual increase year on year till 2018-19 when an average price reached ₹ 142.28 per kg after marketing a total of 85.08 million kg. However, the following two years – 2019-20 and 2020-21 – saw the prices decline to ₹ 124.06 per kg and ₹ 119.87 per kg, probably on account of COVID-19.
But, subsequent years saw a sharp surge when the average prices went up to ₹ 163.11 per kg for 2021-22 when 68.14 million kg was marketed before reaching ₹ 228.01 per kg in 2022-23 when 59.98 million kg was marketed.
Meanwhile, the Tobacco Board said it had also commenced sale of scrap and bits of tobacco in the auctions from last year. Pointing out that the farmers were able to realise remunerative prices for scrap and bits tobacco also, the Board said about 3.62 million kg of scrap and bits tobacco was marketed during 2023-24 auction season at a record average price of ₹ 141.54 per kg, which is 34.11 per kg higher than the ₹ 107.43 per kg that was realised last year.
