Even as yet another tobacco-crop season is set to begin, farmers growing Black Burley are at the crossroads in the absence of viable alternatives and no takers for this variety of tobacco. With a bleak season behind them, farmers in Andhra Pradesh are left with no option but to reduce the area under Black Burley.
The farmers produced nearly 80-90 million kilogram (mkg) of Black Burley tobacco against the average production of 20-25 mkg, creating a huge glut. This prompted the State government to step in and purchase about 25-30 mkg to bail out the farmers.
“Despite the intervention, there is a huge surplus. I expect them to pare the area to below the normal area to avoid the repetition of what they experienced in the last season,” Murali Babu, a leader of Federation of All India Farmer Associations (FAIFA), told businessline.
He said the lack of viable alternatives that can encourage them to quit tobacco was a major challenge.
Batting for reforms
The prices collapsed to ₹110-120 per kg in the last season (2024-25), down from ₹230 in the 2023-24 season. Unusual returns on the produce in the last year prompted farmers to triple the production. But as the demand plummeted this year, there were no takers for the produce, leaving them in a massive crisis.
The Tobacco Board’s mandate doesn’t include this variety. As a result, the farmers are left to either enter into bonds with traders or companies or take a risk in growing the crop, anticipating purchases by traders later.
M Venkateswara Rao, an exporter, felt that reforms in tobacco cultivation and marketing were urgently needed.
“Some companies are even allowed joint ventures, yet broader reforms remain stalled. When sensitive industries such as defence manufacturing have welcomed foreign direct investment, why has tobacco, an industry with major health implications and revenue potential, been excluded?” he wondered.
Foreign companies willing to set up processing and product industries here are denied permission.
Brazilian example
“Last year, Brazil’s crop yield dropped because of floods, while other producing countries also faced reduced cultivation. This year, however, yields have increased globally. Combined with reduced demand following the global impact of Covid-19, the market has slowed, with fewer investors and buyers,” he said in a statement.
“Over the next five years, the sector will require an estimated ₹1,500–2,000 crore to modernise curing infrastructure, build traceability systems, secure sustainability certifications, and establish processing hubs,” he felt.
He pointed out that Brazil modernised its curing infrastructure and embraced global sustainability standards through international partnerships, enabling its farmers to consistently earn 15-20 per cent more.
A tobacco analyst, however, contends that the country has sufficient processing capacities to handle the entire production. “I don’t think there is any issue regarding the processing,” he said.
Published on October 7, 2025