Tobacco purchasing companies in Pakistan have reduced their demand for the 2026 crop by 13.2 million kg, setting total requirements at 61.627 million kg. This marks the fourth consecutive year of cutbacks, with overall demand falling from 85.5 million kg in 2023 to 77.3 million kg in 2024, 74.8 million kg in 2025. The bulk of purchases will be made by multinational firms, led by Pakistan Tobacco Company and Philip Morris (Pakistan) Ltd, which together account for more than 36 million kg of flue-cured Virginia (FCV) tobacco. The remaining FCV demand will be met by 78 national companies, including Khyber Tobacco. While demand for FCV, dark air-cured, and sun-cured tobacco has declined, requirements for White Patta and burley tobacco have increased slightly.
Industry experts note that farmers are facing severe financial losses due to limited storage options and price discrepancies between the weighted average price (Rs 719 per kg) and the minimum indicative price (Rs 545 per kg [$1.96]). Companies profited by Rs 6.2 billion ($22.2 million) from surplus purchases at lower rates in 2025, while growers bore the losses. Despite reduced domestic demand, tobacco exports surged from 20 million kg in 2023-24 to 47 million kg in 2024-25, a 135% increase. However, Ayaz Khan, former director of the Pakistan Tobacco Board, said the benefits of rising exports have not reached farmers, who remain vulnerable to falling purchase prices and shrinking demand, leaving them at a disadvantage compared to multinational and national firms.
