MYSORE FCV CROP REPORT (2022 -23)

Here are the major takeaways from the following report covering the ongoing sale of Mysore FCV 2022-23.

  • The average price $2.96/kg in green leaf is still much cheaper compared to other origins thanks to a stable economy.

  • It has been more than three months and only 27.54 Million Kilos have been sold out of the total estimated crop size of 59.79 Million Kilos.

  • The decline in daily arrivals is mainly because the growers are still in anticipation that the prices would go up. Apparently that seems to be not the case as no company is willing to disrupt the market.

Indian Traditional FCV: Cyclone Effect

Cyclone Mandous & Traditional FCV
 
With the of late intentional and steady decline of the yet to be marketed quantity of Mysore FCV at the auction floors (from 0.94 Mil kgs/day ->peak of November to just 0.09 Mil kgs/day –> last week), the FCV growers of Karnataka are doing their best to retain the highest ever average price that transpired in November as the average price in green last week was at Rs. 228/kg ($2.76/kg) from its peak average at Rs. 254/kg ($3.08/kg) last month.

While all the focus was on Mysore FCV, the unseasonal heavy rainfall caused by cyclone Mondous that struck the south east coast of India last week had brought new troubles to the tobacco farmers of Traditional FCV. As of Tuesday 13.12.2022, no real assessment specific to tobacco crop had been done to the extent of damage caused, farmers did express concerns over the subsequent losses that result from the untimely rains.

It is evident that the extent of damage varied from region to region. For instance, almost 80% of SLS (Southern Light Soils) region has finished transplantation about a month ago and only 70% of SBS (Southern Black Soils) region has begun transplantation of seedlings. It is reported that most of the low-lying areas from these regions have partially and fully submerged in flood water.

This tragedy puts unanticipated burden on the farmers as they have no choice except to make additional investment for purchase of seedlings and bearing the transplantation costs.

It is also being expressed that the farmers are still motivated to hit the targeted 89 Million Kilos mark (compared to 76.5 Mil Kgs sold last season) after witnessing a better average pricing for the previous crop as well as with the ongoing Mysore FCV.

#tobacco #tobaccoindustry #kkme #kkmetobacco #fcv #agriculture #indianagriculture

Mysore FCV 2022: Market Trend

So what’s going on with MYSORE FCV crop 2022?

The auctions, which began on Monday the 10th Oct at all the 10 platforms, have raised hopes among the growers of a better season ahead with an opening price of Rs. 202/kg (US $2.46/kg) for green tobacco.
 
All the excitement did not last long as the prices quickly escalated to a whopping Rs. 260/kg (US $3.17/kg) on the 8th day of auctions which lead all the companies take a collective and proactive decision to not bid over Rs. 230/kg (US $2.80/kg).
 
On the 9th day of auctions, this decision was immediately opposed by the growers with commotion and display of protests that resulted in complete halt of auctions at all the floors.
 
Here are the stats for some perspective:
 
18.10.2022   vs   18.10.2021:
 
·       High Bid: Rs.260/kg (US $3.17/kg) vs Rs.186/kg (US $ 2.27/kg)
 
·       Avg. Price: Rs.233/kg (US $2.85/kg) vs Rs.150/kg (US $1.84/kg)
 
·       Low Bid: Rs.150/kg (US $1.83/kg) vs Rs.100/kg (US $1.22/kg)
 
·       Estimated Crop Size: 63.69 Mil Kgs vs 81.71 Mil Kgs
 
·       Targeted Crop Size: 100 Mil Kgs vs 97 Mil Kgs
 
·       Crop Sold: 2.1 Mil Kgs vs 3.8 Mil Kgs
 
 
The apparent reasons one would assume for such high prices would be the continuing geopolitical concerns, rising interest rates, inflation, high prices of crude oil etc.
 
But in contrast and despite the turmoil in the global economy, Indian financial situation continues to remain resilient. All the reasons above do contribute a little but the fair share of the blame is on,
 
1. The reduced crop size which is a direct result of the adverse climate conditions that brought down the crop to 63.69 million kgs from the targeted 100 million kgs.
 
2. Overall reduction in tobacco crop size globally.
 
In a situation like this, the growers obviously would try to embrace the opportunity but this time around it’s different.
 
As opposed to 12 active companies at the auction floors in 2021, crop 2022 witnessed 24 active companies.
Hoping the tobacco would get even expensive, a third of these companies opted to disruptive and speculative buying strategy wherein they intend to procure as much volume as possible by bidding higher and higher.
 
This creates a very unpleasant market situation which the Tobacco Board of India along with the Trade and Framers Associations are trying to resolve at the moment.

#tobacco #tobaccoindustry #kkme #kkmetobacco #economy #agriculture #farmers #indiantobacco #mysore #mysorefcv

INDIAN NLS FCV 2022

So, what's going on with INDIAN NLS FCV 2022 ??

First off, NLS isn't a short crop this season like the rest of the varieties thanks to the fixed hectarage of palm oil under cultivation which limits the farmer to go with the second best alternative i.e. tobacco.

Regardless of High or Medium grades i.e., (L1 - L5), (C1-C3) & (X1 & X2), the sale price at the auctions is fixed at Rs. 230/kg ($2.9/kg) which was Rs. 195/kg ($2.46/kg) just a few weeks ago.

The farmers tend to sell off the low and medium grades first while holding on to the high grades hoping for further price hikes. That strategy seems to have worked quite well this time. But that is certainly not a favorable situation for a buyer with already committed orders at hand.

Irrespective to the significant price fluctuation, KKME was still able to fulfill and execute orders at committed rates even when it gets close to financially unfeasible situation.

Because, end of the day CREDIBILITY is all that matters.

#tobacco #tobaccoindustry #kkme #kkmetobacco

Indian Cigar Tobacco

Natu Tobacco which also goes by Organic or Native variety is normally used by the locals hand-rolled in an un-fashioned manner. Centuries ago this has been a common man's luxury commodity.

As the trend has switched to cigars these days, this variety has gained a unique prominence amongst cigar makers for it's amazing flavor and firmness for wrapper and binder usage.

KKME defining "Strategic Procurement"

1. Grass root level involvement:
Continuous proactive involvement with growers and constant field surveys, makes us more informed of the risks and benefits of procuring from the crops of a specific region.

2. Price to quality ratio:
Today most of the clients look for suppliers that understand their true requirements. Satisfying the visual, manufacturing & chemical criteria while maintaining an optimal price is something not all traders can achieve.

3. Forecasting market trends:
Relentless engagement with growers, traders, industry leaders and policy makers help us forecast market trends and lets us take the right steps even during the times of pandemic.

Repost from https://www.linkedin.com/posts/k-k-mohan-enterprises_tobacco-tobaccoindustry-kkme-activity-6764464752979779584-6H7I

FCV From NLS (North Light Soils)

Flavorful to semi-flavorful FCV tobacco from sandy to sandy-loam soils of East and West Godavari districts of Andhra Pradesh completes the diverse variety of FCV that India has to offer.

Color: Lemon orange to orange
Leaf size: Medium to Large
Pore vol: 0.13 (mi/gm)
Filling value: 2.2 to 2.8 (cc/gm)
Nic %: 1.5 to 3.0
Sugar %: 13.8 to 20.5

Traditional FCV's MF2 Trial Packing

To obtain a sample of Re-dried Threshed Lamina that weighs just about 2 kgs, we had to feed a minimum of 1600 kgs of raw tobacco into the machines to make it an optimum operation. Certainly it's worth every penny as it gives a clear understanding to the clients that intend to perform a thorough evaluation of samples.

Clarification on the grade:

"B3O / MF2 / Y2"

The farmers call it Y2. The trade calls it MF2. Exporters call it B3O.

PS: We really wish there is a harmonized grading system that is being used and accepted globally to avoid confusion.