Procure tobacco at MSP immediately to instil confidence among farmers: Andhra CM to companies

Amaravati, July 8 (PTI) Andhra Pradesh Chief Minister N Chandrababu Naidu on Wednesday directed tobacco companies to immediately begin procurement to instil confidence among farmers. Reviewing the status of tobacco procurement with officials and traders at the Secretariat, the Chief Minister expressed dissatisfaction over the functioning of the Tobacco Board and questioned why traders had slowed down purchases in Andhra Pradesh when no such issue existed in neighbouring Karnataka. "Companies should immediately start procurement operations to instil confidence among farmers and expedite the auction process. All tobacco must be procured at the MSP fixed by the state government, and the price should not fall below Rs 200 per kg," Naidu said in an official press release. The Chief Minister warned tobacco companies against causing hardship to farmers, cautioning that inadequate support could force cultivators to shift to other crops. He also reviewed procurement commitments made by 28 companies and the quantity purchased so far. Naidu warned that companies which had submitted procurement indents but failed to honour them would face action. He particularly criticised the slow pace of procurement by ITC Limited, Godfrey Phillips India Limited and VST Industries. Together, the three companies had submitted procurement indents for 95.5 million kg of tobacco but had purchased only 17.6 million kg so far, the release said. Representatives of the trading companies told the Chief Minister that the current crisis was primarily due to tobacco production exceeding market demand. They said procurement had already exceeded their actual requirements and that declining exports had further affected purchases, while assuring him that procurement would continue. Officials informed the Chief Minister that the absence of an open market for tobacco had aggravated the situation. While companies had placed indents for 142 million kg, farmers had produced 232 million kg, resulting in oversupply, lower prices and slower procurement, the release added. PTI MS ADB