The FCV tobacco farmers in Andhra Pradesh have realized an amount of Rs. 585 crore more than last year, in spite of the total production coming down to 165 Million Kgs compared to last year volume of 172 Million Kgs. The total amount realized during 2008 is Rs.1,401 compared to Rs.784.82 crore realized during last year.

The FCV tobacco auctions in Andhra Pradesh during the year 2008 have fetched historic prices to farmers, breaking all time record since the introduction of auction system in the year 1984. The average price realized by farmers is Rs.84.75 paise per kilogram compared to Rs.47.47 paise per kg realized during 2007. The farmers got Rs.37.28 paise per kg higher than last year, which is an increase of 79 % over last year. The highest average price realized till last season in the annals of tobacco auctions in Andhra Pradesh was Rs.47.47 per kg and in Karnataka was Rs.59.23 per kg.

The highest price received for best quality tobacco has gone up to Rs.141.60 per kg compared to earlier highest price of Rs.65 per kg in NLS region which is 118 % higher. Same is the case in other soil regions also. In SBS region the highest bid was Rs.135.00 compared to last year price of Rs.50.10 (169.4%), in CBS region was Rs.134.80 compared to last year Rs.52.00 (159.2 %), in NBS region was Rs.120.00 compared to last year price of Rs.51.20 (134.4 %) and in SLS region was Rs.135.00 compared to last year price of Rs.53.00 (155 %).

The auctions during 2008 also concluded in a record time of 123 auction days compared to previous year duration of 163 auction days.

The prices have improved due to the effective measures taken up by the Tobacco Board in controlling the cartel formation among the traders in addition to controlling excess production of tobacco.

The exports of tobacco and tobacco products during 2007-08 have also recorded the highest in the annals of tobacco. The total exports are to the tune of US $ 503 Million (Rs.2.023 crore) compared to previous year record of US $ 382 million (Rs.1,723 crore). The total quantity of Un-manufactured tobacco exported was 1,74,690 MT compared to previous year which was 1,52,816 MT. The volume of tobacco products exported was 30,657 MT compared to previous year which was 28,370 MT.

The Tobacco Board has introduced electron auction system on pilot basis to replace the existing manual system of auction. The pilot e-auction project was launched in Jangareddygudem auction platform in Andhra Pradesh. In the e-acution, every buyer is provided a Hand held Terminal (HHT) for bidding which is linked to the server in wireless network environment. The e-auction is totally transparent and avoids room for manipulation and errors.

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RJ/MRS

Cartel control and auction digitization restore price signals and market transparency, improving tobacco auction outcomes and exports. The Tobacco Board's measures to control cartel formation and to manage excess production are credited with higher auction prices and shorter auction duration; concurrently, the Board piloted an e-auction system using handheld terminals linked to a central server to enhance transparency and reduce manipulation, with exports also increasing alongside improved market functioning.