Tag: Brazil

  • AOI Promotes Grower Income Diversification

    AOI Promotes Grower Income Diversification

    Photo: AOI

    Alliance One Brazil has partnered with Bayer Crop Science to provide quality maize seeds and agronomic support to smallholder tobacco farmers in Brazil. Through the partnership, Alliance One Brazil’s goal is to help its contracted farmers diversify their income by strengthening the quality and yield of a crop that is complementary to tobacco.

    “Approximately 75 percent of our contracted Brazilian farmers produce maize along with tobacco,” said Helio Moura, AOI’s global agronomy director, in a statement. “By providing our contracted farmers with a high-quality agronomic package for maize, we are helping them improve the quality and yield of the maize crop.”

    “One of our company’s top priorities is the improvement of farmer livelihoods.”

    During the 2020 growing season, Alliance One Brazil implemented a pilot project with 2,300 farmers to evaluate interest in future program participation.

    The team found that farmers appreciated the support and guidance related to maize in addition to the ongoing support related to tobacco.

    As a result of the positive feedback from the farmers, Alliance One Brazil will implement this project across its full farmer base throughout the 2021 crop season.

    Over the next three years, Alliance One Brazil intends to expand the project to include other crops, and AOI will evaluate how the project could be expanded throughout the company’s global operations.

    By providing the necessary support to enhance the crops that they are already growing, we are providing our contracted farmers with the tools they need to diversify their income.

    Helio Moura, global agronomy director, AOI

    “One of our company’s top priorities is the improvement of farmer livelihoods,” Moura added. “By providing the necessary support to enhance the crops that they are already growing, we are providing our contracted farmers with the tools they need to diversify their income. In addition, crop diversification is becoming increasingly important as extreme weather patterns impact crop production. We are excited about the potential for this project and the potential for AOI to scale it at a global level in the future.”

    AOI is profiled in Tobacco Reporter’s June 2021 print edition.

  • ‘Reforestation Efforts Paying off in Brazil’

    ‘Reforestation Efforts Paying off in Brazil’

    Photo: Joao Bispo

    Tobacco industry reforestation efforts are paying off in southern Brazil, reports industry association SindiTabaco on National Atlantic Forest Day. Over the past 40 years, the tobacco sector has been working to eradicate the consumption of wood from native trees for curing. As a result, Forest cover on small-scale tobacco farms has now reached 24 percent, split into 15 percent native forests and 9 percent planted forests, according to data released by the Tobacco Growers’ Association of Brazil.

    “For some decades now, the sector has been self-sufficient in fuel wood for curing tobacco, and thus native forests are preserved,” said SindiTabaco president Iro Schunke. “Incentives provided by the industries, which started in the mid-1970s, and the farmers’ willingness to plant eucalyptus trees played a fundamental role in the present enviable forest cover rates.”

    In 2019, SindiTabaco partnered with the Federal University of Santa Maria to preserve forests while providing farmers with a sustainable source of energy.

    “Tobacco is a centuries-old crop, and when it was brought to our region, it was strongly dependent on natural forests as a source of fuel wood, particularly because back then there were no planted forests,” says research coordinator Jorge Antonio de Farias.

    For some decades now, the sector has been self-sufficient in fuel wood for curing tobacco, and thus native forests are preserved.

    Iro Schunke, president, SindiTabaco

    “Such common tree species as eucalyptus and acacia were rare at that time and little known, and, on the other hand, native forests were in great abundance. As of the 1970s, when the sector set targets to eradicate the consumption of wood from native trees, the farmers began to use wood from planted forests.

    “Within this context, the target of the project consists in strengthening the conquests achieved so far—that is to say, the maintenance of the existing native forests—and at the same time come up with new elements and technologies capable of increasing the productivity rates of existing reforested plots whilst establishing new reforestation areas.

    “To this end, we are creating reference units in tens of tobacco farms, testing new technologies and techniques, like spacing—distance between trees—new genetic materials and forest species that lead to higher productivity and energy performance.”

    The results of the research will be shared through social media channels with tobacco farmers.

  • Brazil: Farmers Benefit from Diversification

    Brazil: Farmers Benefit from Diversification

    Iro Schunke
    (Photo: Taco Tuinstra)

    Brazilian tobacco growers who adhered to the winter crop within the Corn, Bean and Grazing Land after Tobacco Harvest Program benefited from the high value of the grains this year. This is demonstrated by the survey conducted by the Interstate Tobacco Industry Union (SindiTabaco), which promotes the crop diversification program in southern Brazil.

    The area devoted to corn, bean and soybean soared 22 percent in the southern region compared with last year, reaching 144,222 hectares. On the other hand, the area devoted to grazing land dropped 27 percent to 25,572 hectares. Due to weather conditions, productivity rates dropped 34 percent on average, resulting in a total crop production volume of 580,442 tons.

    The estimated extra revenue amounts to BRL933 million ($174 million), up 47 percent from 2020, when farmers earned BRL634.2 million from the cultivation of grains and grazing land.

    “Diversification is always a good option for the farmers, as it makes it possible for them to earn money from different activities,” said Iro Schunke, president of SindiTabaco, in a press note. “In 2021, we observed a preference of the farmers for the cultivation of grains to the detriment of grazing lands, which resulted into higher earnings, and the credit goes to the good moment these commodities are experiencing within Brazilian agribusiness.”

  • Brazilian Leaf Exports up in 2021

    Brazilian Leaf Exports up in 2021

    Photo: Taco Tuinstra

    Brazil is likely to export significantly more leaf tobacco this year than it did in 2021, according to the Interstate Tobacco Industry Union, SindiTabaco, which expects tobacco export revenues to grow accordingly.

    A survey conducted for SindiTabaco by Deloitte shows that shipments should increase between 2.1 percent and 6 percent in volume and between 6.1 percent and 10 percent in value compared to 2020, when exports amounted to 514 million kg and $1.64 billion.

    From January to March 2021, exporters shipped 134 million kg of tobacco valued at $418 million, up 19 percent from the same period in 2020, according to the Ministry of Economy.

    “Brazil has managed to keep annual exports at approximately 500,000 tons, a fact that attests to stability in the global market even in the face of a pandemic and all its social and economic developments,” said Iro Shuenke, president of SindiTabaco, during a meeting with tobacco supply chain stakeholders on April 28.

    It is our expectation that Brazil will continue as leading global tobacco exporter, a position occupied by the country since 1993.

    Iro Shuenke, president, SindiTabaco

    The Brazilian tobacco growers’ association Afubra expects southern Brazil to produce 606.95 million kg of tobacco in an area of ​​273,356 hectares this year, according to a report relayed by Kohltrade. The number of tobacco-growing families declined by 6.02 percent to 137,618 this season.

    In 2020, tobacco accounted for 0.8 percent of Brazilian exports. In Rio Grande do Sul, which produces nearly half of Brazil’s tobacco crop, the product accounted for 9.5 percent of all exports.

    The main destinations for Brazilian tobacco in 2020 were the European Union, accounting for 41 percent of the country’s leaf exports; the Far East (24 percent); and Africa/the Middle East (11 percent).

  • Alternatives for Adolescents

    Alternatives for Adolescents

    Iro Schunke Photo: Taco Tuinstra)

    Youth empowerment, the main objective of the Growing Up Right Institute, is a key element for transformation in Brazil.

    By Stefanie Rossel

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    The United Nations has declared 2021 the International Year for the Elimination of Child Labor. Although child labor decreased by 38 percent in the past decade, it still affects 152 million children worldwide. According to the International Labor Organization (ILO), around 70 percent of child laborers work in the agricultural sector. Tobacco cultivation plays an inglorious role in this issue—child labor still occurs in developing countries, such as Malawi and Indonesia, but also in rich countries, such as the United States.

    Brazil, the world’s No. 2 tobacco producer, which in 2020 exported $1.4 billion in leaf, according to Statista data, is familiar with the issue too. In 2008, the country barred children under 18 from any work with tobacco and imposed penalties for child labor violations for farmers, factories and companies that purchase tobacco leaves from fields that employ children. Through extensive information campaigns, the government has raised tobacco farmers’ awareness about the hazards of nicotine and pesticide exposure, particularly for children. Despite the country’s understaffed labor ministry and lack of resources to carry out sufficient inspections, Brazil has been praised for its progress in addressing the problem.

    “The tobacco sector is, without any doubt, a model of child labor eradication in the rural areas in Brazil,” says Iro Schünke , president of the Growing Up Right Institute (Istituto Crescer Legal, or ICL). “The fact has already been acknowledged by the ILO. For over two decades, we have been fighting the problem, and it is no exclusivity of the tobacco sector in the rural area.”

    Between 2000 and 2010, the greatest reductions in child labor reduction took place on smallholder tobacco farms, according to the Brazilian Institute of Geography and Statistics. During that decade, the sector lowered the rate of child labor in the tobacco supply chain by 58 percent in Rio Grande do Sul, even as the area dedicated to tobacco cultivation doubled. The national average reduction of child labor, Schünke  points out, is 10 percent.

    Numerous awareness initiatives on farmers’ health and safety and child and adolescents’ protection, launched by Brazil’s tobacco industry since 2009, have contributed to this development. According to Schünke , the tobacco industry is the only agricultural sector in Brazil to require school enrollment forms and school attendance certificates of school-age children as a condition for the renewal of commercial contracts with farmers.

    “The main challenge to the theme in the rural area, especially in family farming, is a cultural question,” says Schünke . “During all those years of holding seminars, we perceived a feeling of great anxiety among the farmers about what to do with their children once they conclude their elementary school. The shortage of rural schools is just another problem in the rural area and, along with the problem of drugs and idleness, the parents end up contributing toward a cultural viewpoint that places great value on work, thus encouraging the children and adolescents to engage in activities inappropriate for their age.”

    Creating better chances

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    Awareness work was necessary to help parents place greater value on education while public policies were needed to strengthen the schools in rural areas, according to Schünke . In 2015, SindiTabaco, Brazil’s Interstate Tobacco Industry Union, and its associate companies established the ICL. Supported by experts and organizations involved with education and the fight against child labor, the initiative provides young people with opportunities in rural areas.

    It is currently focused on southern Brazil—a major tobacco cultivation region—and provides children between the ages of 14 and 17 who want to follow in the footsteps of their tobacco-growing parents with training programs in rural administration and entrepreneurship. The curriculum includes studies of the rural properties, diagnosis of the municipality and region based on the local productive arrangements, mapping of local partnerships and strategic alliances. It also involves the development of group work, engaging the families and communities, as well as product creation and viability studies.

    The adolescents are hired as apprentices by tobacco companies and are remunerated in compliance with the country’s learning law. Instead of working, the participants carry out theoretical and practical activities within the premises of the school, geared toward the reality of their families and communities, thus stimulating life projects and personal development without leaving the rural areas. Exclusively focused on rural management and entrepreneurship, there is no training relative to any specific type of rural activity, not even tobacco, Schünke  explains. “The young are provided with tools to think about their life projects, whether in the rural setting or in town, with an eye on sustainability.”

    The training takes place in the shift opposite regular school hours and comprises 900 hours of tuition in one year. “The young apprentices [enjoy] the same benefits as the apprentices in town,” says Schünke . “This is a way to keep them away from inappropriate activities for their age and, at the same time, provide them or their families with a source of income,” says Schünke . “The course also provides the adolescents with a new vision on the countryside—they come to know about possibilities that have not yet been explored by their family members; they come to grips with the value of the land and acknowledge the farm as business. “Within this context, it is not a rare thing to see a change in the way some young people look at the rural activities and at the countless chances to do business in the countryside, whether as farmers, service providers, educators or leaders in their communities, for example.”

    Rural exodus is a major issue in Brazil, which is one of the most urbanized countries in Latin America. According to Statista, almost 87 percent of the population lived in cities in 2019; their share has continuously increased over the past decade.

    Toward more gender equality

    In its six years of operation, nearly 500 young people have benefited from the ICL’s rural professional learning program. The initiative, says Schünke , has gained momentum at national and international levels. “When they finish the course, the youth are more qualified to understand that it is through qualification and education that they can improve their quality of life. Furthermore, they are in a better position to understand which tasks are appropriate to their respective age and the importance of their extended and continuing education, carrying on with their studies of both their elementary education and higher education. As a result, they are better prepared to make their choices for the future and engage in professional work as soon as they achieve the minimum age required.”

    Apart from the training program, the institute offers courses focused on gender equality and on entrepreneurship in education. “Us for Them—The Female Voice in the Countryside” is a program designed to develop the communication skills of young rural girls. One of its objectives is to keep all rural communities informed through local radio programs. “Four editions of the program have already been conducted, starting in 2017, focused on former girl students of the rural professional learning program.”

    In 2020, the institute launched a pilot of its program “Good Practices in Entrepreneurship for Education” in the municipality of Cangucu, Rio Grande do Sul. The initiative consists of sharing methodological tools tested and approved by the pedagogical team of the Growing Up Right Institute with the aim to qualify teachers able to multiply these practices geared toward administration and entrepreneurship.

    For the time being, all the activities take place exclusively in Rio Grande do Sul, Schünke says. “We have plans to extend the activities of the institute to other tobacco growing regions in Brazil.”

    Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.
  • Court Upholds Brazil’s Power to Ban Tobacco Additives

    Court Upholds Brazil’s Power to Ban Tobacco Additives

    Photo: Taco Tuinstra

    Brazil’s Federal Regional Court of the First Region on Jan. 25 affirmed the Brazilian Health Regulatory Agency’s (ANVISA) power to ban the use of additives in tobacco products.

    With this decision, the federal court affirms a February 2018 ruling of Brazil’s Supreme Federal Court–the country’s highest court that recognized ANVISA’s authority to regulate tobacco products and upheld a 2012 regulation prohibiting flavors and additives in tobacco products sold in the country.

    Due to a quorum issue, the ruling of the Supreme Court did not have a binding effect over other lawsuits previously filed with ordinary federal courts by tobacco companies and the trade group Sinditabaco.

    Based on these lawsuits, British American Tobacco subsidiary Souza Cruz and Phillip Morris International were granted injunctions and allowed to continue selling flavored products. The Federal Regional Court ruling on Monday lifted those injunctions and set a precedent for other similar cases in the country. 

    “This decision reaffirms Brazil’s role as a global leader in tobacco control,” said Patricia Sosa, director of Latin American and the Caribbean programs at the Campaign for Tobacco-Free Kids, in a statement. “We urge other countries in the region and around the world to follow its lead and ban all flavored tobacco products to protect youth and other vulnerable populations.”

    In 2012, Brazil became the world’s first country to ban the use of flavors and additives in tobacco products, including menthol. This ban was approved following two years of public hearings and broad stakeholder participation.

  • JT in Brazilian venture

    JT in Brazilian venture

    Japan Tobacco International officially opened its first South American cigarette factory on September 26, according to a note posted on its website on October 11 or 12.
    The factory is in Santa Cruz do Sul, which has been JTI’s base since 2009 when the company started leaf tobacco operations in Brazil.
    The 10,000-m2 plant has the capacity to operate four production lines in up to three shifts.
    The note said the factory would produce Camel and Winston, which are sold in Brazil, and LD for export.
    In addition to supplying the Brazilian market, the factory’s output would be distributed to Argentina, Bolivia, Chile and Ecuador, and, gradually, to the whole of Latin America.
    “In 2018, we celebrated 100 years of Japanese settlement in Brazil,” Mutsuo Iwai, Japan Tobacco Inc.’s executive vice president and president of the Tobacco Business, was quoted as saying. “Now, we are very proud to open this factory in Santa Cruz do Sul. This is a great step to develop our business in Brazil. The JT Group will continue to establish strong relationships with Brazilian stakeholders.”

  • Tax link questioned

    Tax link questioned

    Claims by the tobacco industry of a positive association between price/tax changes in respect of tobacco products and the illegal trade in those products are unsubstantiated, according to an article by Guillermo Paraje, PhD for Nicotine and Tobacco Research, published by Oxford University Press.
    An abstract of the piece, Illicit Cigarette Trade in Five South American Countries: A Gap Analysis for Argentina, Brazil, Chile, Colombia and Peru, concludes that using simple statistical methods, ‘it is possible to assess the trend in tobacco illicit trend over time to better inform policy-makers’. ‘Getting reliable and regular population consumption surveys can also help to track tobacco illicit trade,’ the conclusion states. ‘Claims by tobacco industry of a positive association between price/tax changes and illicit trade are unsubstantiated.’
    Under the heading Implications, the abstract says, in part, that the evolution of ‘cigarette illicit trade in five Latin American countries show different trajectories, not in line with tobacco industry estimates, which highlight the importance of producing solid, independent estimates’.
    ‘There are inexpensive methodologies that can provide estimates of the evolution of the relative importance of illicit trade and can be used to inform policy-makers.’

  • Sustainable water use

    Sustainable water use

    Philip Morris International said yesterday that its major factory in Santa Cruz do Sul, Brazil’s main tobacco-growing area, was the first factory in the country to be certified by the Alliance for Water Stewardship (AWS).
    ‘Based on the AWS international standard for sustainable water use, the certification recognizes PMI for its leadership within its manufacturing operations and for being mindful of the local watershed and community needs surrounding the site,’ PMI said in a note posted on its website. ‘Building on the success of this initiative for AWS implementation in Brazil, PMI is committing to certify at least 10 more facilities by 2020, and all of its operations worldwide – 46 facilities – by 2030.’
    “As we progress towards our vision of a smoke-free future, we know that reducing our environmental impact to sustainably manage the planet’s limited resources is also key to our long-term growth,” said Massimo Andolina, senior vice president of operations at PMI. “Water is precious, and we are committed to using it responsibly wherever we operate. We look forward to building on this success in Brazil to extend our efforts globally and hope this commitment will inspire other companies in our value chain and beyond to take similar steps on water stewardship.”
    Meanwhile, Alejandro Okroglic, director of operations for PMI’s local affiliate, PM Brazil, said implementing the AWS standard had allowed the company to improve its understanding of what sustainable water use really meant. “Our AWS team and our 1,600 employees are fully engaged to ensure that our factory meets the AWS standard, including engaging with local authorities, the farming community and civil society groups,” he said.

  • Illegal trade targeted

    Illegal trade targeted

    The Brazilian Institute of Competitive Ethics and the City of São Paulo have launched a movement to combat smuggling and the sale of counterfeit products, according to a note posted on the US Center for Regulatory Effectiveness’ (CRE) website.

    The goal is to attract to the movement Brazil’s largest cities, where such illegal trade is strong.

    The CRE story said that, in Brazil, the illegal market ‘generates a loss of R$49 billion (US$16 billion) in tax revenue each year, according to a survey by the National Fund Against Piracy and Illegality’.

    The movement’s plan, prepared in partnership with business entities, is said to provide for integrated action by federal, state and municipal bodies, and the creation of a committee charged with outlining actions to combat the illegal activities.

    Sixteen areas of the economy highly affected by smuggling and counterfeiting have already been identified.

    One, of course, is the cigarette industry. “In addition to currency evasion, this problem increases unemployment,” Liel Miranda, president of Souza Cruz, was quoted as saying.

    Smuggled cigarettes are said to account for 41 percent of the tobacco market in Brazil, which has the second largest smuggled sector after Malaysia, with 51 percent.