Tobacco Farmers Gain Confidence As Market Conditions Improve
Tobacco farmers in Andhra Pradesh see improved auction conditions as buyer competition rises and no-bid bales decline despite surplus production.
The Andhra Pradesh government has assured tobacco farmers of better prospects in the ongoing 2025–26 FCV tobacco auctions, with market conditions showing a steady improvement.
Agriculture minister K Atchannaidu said chief minister Chandrababu Naidu’s directives have ensured that farmer welfare remained the government’s top priority. There, he said, is continuous monitoring of auction centres to ensure their smooth functioning.
By September 4, auctions completed 132 days, marketing 86.59 million kg of FCV tobacco against the permitted crop size of 142 million kg. Actual production is estimated at 236 million kg, creating surplus pressure on the market. The average price so far stands at `209.83 per kg, compared to last year’s `248.86 per kg for the 140.27 million kg marketed in the same period.
Despite the surplus, Atchannaidu said buyer participation and competition have significantly improved in recent weeks.
The percentage of ‘no-bid’ bales has dropped sharply, now averaging 11–12 per cent daily, with some platforms recording as low as 1–2 per cent. This decline, coupled with stronger buyer competition, is seen as a positive sign for the market. Weekly marketing volumes are averaging 10 million kg, with competitive bidding helping secure better prices for farmers.
Auction centres across regions have reported improved rates. In the Northern Light Soils (NLS) area, bids reached as high as `329 per kg, while Southern Light Soils (SLS) recorded `255 and Southern Black Soils (SBS) `252. Demand for specific grades and varieties has strengthened, with SLS and SBS regions showing notable improvement in both speed of purchases and price realization compared to the early auction phase.
Acknowledging the surplus production this season, the minister announced that the permitted crop size for 2026–27 has been reduced from 142 million kg to 81 million kg. The decision aims to align production with market demand and prevent excessive surplus in future. Farmers are being sensitized through the Tobacco Board to restrict cultivation to the approved quota.
Atchannaidu said the chief minister was giving utmost priority to farmer welfare, ensuring fair prices and stable market conditions. He said auctions will be monitored until completion, with necessary support extended to growers.