NTA keeps 80-M kg production target

MANILA, Philippines - The National Tobacco Administration (NTA) is keeping its 80 million kilogram (kg) tobacco output estimate for crop year September 2011 to August 2012, citing that recent rains are seen to have affected production of tobacco leaves.

“We are just seeing flat growth (in production) for the current crop year as expected increases in production were offset by the weather, by the rains,” NTA administrator Edgardo Zaragoza told reporters yesterday.

He said the NTA was initially aiming for a five percent increase in tobacco output for the current crop year from the revised 79.329 million kg tobacco produced in the previous crop year or crop year 2010 to 2011, but that they decided to stick with the conservative 80 million kg estimate due to unfavorable weather conditions.

“We are just hoping that the damage caused by rains will not worsen,” he said.

The heavy rains in the provinces of Cagayan and Isabela, he said, have affected production of the crop.

The country produces three varieties of tobacco which are: virginia, native and burley.

Zaragoza said the NTA also expects to export about the same volume of tobacco leaves shipped in the previous crop year for the current crop year.

The country, he said, shipped 40.620 million kg of tobacco leaves last year valued at P5.24 billion.

“The orders may be higher but we have to comply with the demand from the local market so exports are assumed to be the same as in the last crop year,” he said.

The country’s top five destination for tobacco exports are the United States, Belgium, South Africa, Korea and Malaysia.

He declined to comment when asked if the NTA supports House Bill No. 5727 which proposes to apply a single rate tax on tobacco products from the current multi-tier system, and for the tax rate to be pegged to the inflation rate.

He said though that tobacco-producing provinces oppose the bill as it is expected to make cigarettes no longer affordable for the low-income bracket and hurt the tobacco farmers.