Tobacco growers in Karnataka, India, sold 106 million kg of leaf this season—6 million kg above the officially sanctioned 100 million kg for 2020, reports The Hindu.
Tobacco sales in the state were suspended in March due to the coronavirus lockdown and resumed on May 20. Auctions concluded this week across the four platforms in Mysuru.
To prevent overproduction, the Tobacco Board of India each year declares a maximum crop size. Excess cultivation is penalized with a fine of INR2 ($0.03) per kg and 7.5 percent of the sales’ proceeds. If the volume of excess tobacco exceeds 10 percent of the authorized crop, the penalty increases to 15 percent of the sale proceeds.
Javare Gowda, president of Karnataka VFC Tobacco Growers’ Federation, said this year’s average price of tobacco was INR10 less than last year’s INR136 per kg.
Anticipating a decline in demand due to the Covid-19 crisis, the Tobacco Board has lowered the size of next year’s authorized crop to 88 million kg from 99 million kg.
Referring to the collapse of tobacco prices in neighboring Andhra Pradesh—where farmers have been burning their bales to protest low auction prices—Gowda urged Karnataka tobacco growers to heed the limits set by the board.