Tobacco Crop Allocation Faces 43% Cut in India, FAIFA Seeks Support Framework

11 August 2026, New Delhi: The Federation of All India Farmer Associations (FAIFA) has welcomed measures by the Central Government and the Andhra Pradesh Government to provide relief to tobacco growers, while urging a calibrated approach to the proposed reduction in Flue-Cured Virginia (FCV) tobacco crop allocation for the upcoming season.

Tobacco farmers, particularly in Andhra Pradesh, are facing financial pressure as unsold stocks have accumulated amid weaker offtake from international buyers. According to FAIFA, the situation has been further affected by high taxation on the legitimate domestic tobacco industry and tax-driven smuggling and illicit trade, which have reduced demand for legally produced tobacco.

The association said government intervention at this stage would provide relief to growers facing a difficult marketing season. However, it expressed concern over the Tobacco Board’s decision to reduce the authorised FCV tobacco crop size by 43% for the next season.

FAIFA acknowledged the need to address the current imbalance between tobacco production and market demand but said a reduction of this scale could add to the financial pressure on farmers already dealing with unsold stocks, lower price realisation and debt.

The association pointed out that several costs associated with tobacco cultivation, including curing barns, labour and farm infrastructure, would not decline proportionately with a smaller crop allocation. This could make cultivation less viable, particularly for smaller growers.

FAIFA also cautioned that shifting to alternative crops may not be practical for many FCV-growing regions. Low-rainfall conditions and specific agro-climatic characteristics in these areas limit the number of crops that can provide comparable returns. It said crop diversification should therefore be promoted only where suitable crops have viable economics and assured markets.

PS Murali Babu, President, FAIFA, said: “The decision to reduce the crop is rooted in prevailing market realities, and farmers understand the need to restore demand and supply balance. However, successful implementation requires a comprehensive support framework that protects farmer incomes while strengthening exports, addressing illicit trade and creating viable long-term opportunities. The objective should not simply be producing less tobacco but producing the right quantity, for the right markets, at remunerative prices.”

FAIFA said Indian tobacco growers also face competition from major producing countries including Zimbabwe, Brazil, Zambia and Malawi, where production has continued despite weaker international prices. It said crop rationalisation should therefore be accompanied by stronger export promotion and measures that provide Indian growers with benefits comparable to those available to farmers in competing tobacco-producing countries.

The association also highlighted unauthorised tobacco cultivation as a contributor to the current supply-demand imbalance. However, it cautioned that an enforcement-only approach could further affect farmers already under financial stress.

Instead, FAIFA recommended a framework combining greater coordination with farmer organisations, clearer communication of market requirements before planting, satellite-based crop monitoring, improved field verification and incentives for voluntary compliance.

According to the association, such measures could improve production planning while helping farmers understand market requirements before committing resources to cultivation.

FAIFA also welcomed the Government of India’s continued engagement with tobacco growers through reviews by the Department of Commerce, visits to auction platforms and direct interactions with farming communities.

The association said sustained coordination among the Tobacco Board, farmer organisations, exporters and manufacturers would be important to restore confidence in the sector and improve its long-term viability.

FAIFA reiterated that crop rationalisation may be necessary to address market conditions, but said its implementation should remain farmer-centric. It called for production discipline to be combined with financial support, export expansion, action against unauthorised cultivation and measures to protect the legitimate tobacco market.

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