tobacco wholesaler Archives - |

Category Archives: tobacco wholesaler

Irene severely damages tobacco

LAWRENCEVILLE – Tobacco farmers are in the process of assessing the damage caused by Hurricane Irene.

On Friday, Sept. 9 Cynthia L. Gregg, Extension Agent, ANR, said Hurricane Irene brought with it loss of power, crop damage and a large scale clean up task, for all residents. The agriculture producers in the county have been dealing with damage to crops, farm buildings and fences.

“Tobacco was hard hit in Brunswick County. The 2000 plus acres in the fields that had not been harvested were affected b the wind and rain. Producers have been in the fields trying to get the tobacco set back up in order to salvage what they can of the 2011 crop as well as inspecting for damage. The tobacco curing in the barns was also a concern for many producers as they lost electricity and getting generators in place in order to save the curing crop of tobacco,” Gregg said.

Gregg said the soybeans are showing some lodging associated with high winds and rain, which could potentially reduce yields. The full season and double crop soybeans are being monitored closely in order to keep an eye on how the damage will affect the crop. There was damage to the leaves and stems of the plan.

Cotton was affected as well, said Gregg. The cop was flattened with the wind and rain. The crop will be hard to harvest as there will likely be maturity issues.

Gregg said in addition to crops, some farm buildings along with fencing and gates were damage.

Taylor Clarke, Extension Agent, said nearly every acre of tobacco was affected by Hurricane Irene. He said producers were expecting an above average crop of tobacco, making the damage to the crop even harder to bear. Clarke said the excessive wind and rain washed the wax from the plant and knocked plants over making harvesting difficult. He estimated that the loss could be $3.5 to $4 million.

Gregg encouraged producers to the Farm Service Agency at (434) 848-2223 Ext. 2 or the Virginia Cooperative Extension office at (434) 848-2151 if they have questions or need assistance.

By Sylvia Allen

Tobacco growers demand better price

TOBACCO crop is of immense economic significance for Pakistan, especially for Khyber Pakhtunkhwa, though it occupies a relatively small area of 0.27 per cent of the total irrigated land in the country and about three per cent of Khyber Pakhtunkhwa.

It is a highly labour-intensive and cost-oriented crop. The cost of production is very high as compared to other cash crops. With suitable crop husbandry, it is capable of yielding high income to growers compared to any other cash crop.

Tobacco companies commenced tobacco purchases at their purchase depots on July 1, the date fixed by the Pakistan Tobacco Board.

Before the commencement of tobacco planting, the board had fixed minimum indicative prices for tobacco crop 2011.

The minimum prices fixed for flue-cured Virginia tobacco was Rs124.30 a kg. However, tobacco growers are not happy with the
minimum prices fixed by the board and those offered by tobacco companies at purchase depots.

This is borne by the fact that great resentment has been shown in the print media over the issue of tobacco growers.

According to press reports, the minimum price fixed by the board is below the cost of production of the crop. Tobacco growers, therefore, demand upward revision of prices being paid to them so that they are saved from financial losses on this account.


Chancellor Donates Proceeds From Tobacco Stock

The chancellor of the University of California, San Francisco, has donated $134,000 from the sale of her stock in the nation’s largest cigarette company to the university’s tobacco control center, officials said Wednesday.

Dr. Susan Desmond-Hellmann, the leader of U.C.S.F. since last summer, had ordered the Altria Group stock sold on Friday, a day after being questioned about it by The New York Times. Altria owns Philip Morris USA and manufactures Marlboro cigarettes.

In a statement this week, Dr. Desmond-Hellmann said she and her husband, who is also a doctor, had not realized their financial adviser had purchased Altria among more than 100 other stocks in their investment portfolio.

“Let there be no question: I am strongly anti-tobacco,” she said, adding that tobacco company stock “conflicts with our values.”

In an interview on Monday, Dr. Desmond-Hellmann said she had handwritten the Altria stock among others on state financial disclosure forms in August 2009 and again last April. In August 2009 she listed its value in the range of $100,000 to $1 million; last April, she listed its value as $10,000 to $100,000; she declined to give specifics.

Dr. Desmond-Hellmann said she thought about divesting it earlier but that the matter slipped her mind as she was busy running the university. She previously worked at Genentech.

“As chancellor of a leading biomedical university, my actions must advance the patient care, discovery and educational mission of U.C.S.F.,” she wrote in the statement. “Therefore, my husband and I will donate all proceeds made from the sale of the tobacco company stock to U.C.S.F.’s Center for Tobacco Control Research & Education.”

The center has 46 faculty members including some of the leading anti-tobacco researchers in the nation. U.C.S.F. also keeps an online data base of more than 50 million pages of once-secret tobacco industry documents unearthed in litigation and investigation.

Updated: Stanton A. Glantz, a medical professor and director of the center, put the value of the Altria donation at $134,000. He said Dr. Desmond-Hellmann telephoned him on Tuesday morning. “She said, ‘I screwed up on this,’ and she said, ‘The best way to make it right, we’ve gotten rid of the stock and my husband and I decided the best use of it would be to donate it to your center. So make good use of it.’”

Professor Glantz praised Dr. Desmond-Hellmann for her support of the university’s anti-tobacco work. “She did have this little faux pas, but I think she acted decisively and her policy before this was excellent,” he said on Wednesday.

Japan Tobacco Rises as Domestic Shipments

Japan Tobacco Inc. (2914) rose the most in almost two months in Tokyo trading after the company said it planned to resume shipments earlier than previously announced for all cigarette brands disrupted by the March 11 earthquake.

The world’s third-largest publicly traded cigarette maker by volume climbed 4.5 percent to 313,000 yen at the 3 p.m. close on the Tokyo Stock Exchange, its biggest gain since May 2. The benchmark Nikkei 225 Stock Average added 1.5 percent.

Japan Tobacco will restore deliveries of all brands by July 18 instead of early August, as it had planned earlier, the company said yesterday. The 9-magnitude earthquake and tsunami forced Japan Tobacco to suspend all domestic shipments for 12 days, with cigarette brands gradually returning to production after that.

“Japan Tobacco can finally move on,” Mitsuo Shimizu, an equity analyst at Cosmo Securities Co. in Tokyo, said by telephone today. “The impact from the earthquake has started to diminish.”

Domestic sales fell 38 percent to 7.2 billion cigarettes in May, the Tokyo-based company said June 10. They plunged 81 percent in April.

By Naoko Fujimura

Tobacco firms face Australia anti-smoking plan

SYDNEY — Australia’s push to become the first country to mandate cigarette packaging with almost no branding and huge, graphic health-warning labels has inflamed the tempers of tobacco companies, which are vowing to protect shareholder interests by taking their fight to the courts.

The proposed laws would mark the latest blow to tobacco firms, already battling volume contraction, swelling illegal trade and global anti-smoking campaigns.

But analysts have nonetheless identified some signs of life in the challenged, multi-billion dollar industry, with emerging markets presenting the best opportunities.

Under the new laws, cigarettes in Australia would be sold in dull olive-green packets, emblazoned with graphic depictions of smoking-related diseases. The size of existing health warnings would be increased, and company logos and branding restricted.

“The new packs have been designed to have the lowest appeal to smokers and to make clear the terrible effects that smoking can have on your health,” Australia’s Health Minister Nicola Roxon said in a statement.

“The only thing to distinguish one brand from another will be the brand and product name in a standard color, standard position and standard font size and style,” Roxon said.

The government hopes to introduce the law by January 2012. But its passage won’t be uncontested.

The tobacco industry argues the no-frills packaging plan could violate its trademark and intellectual property rights.

“Our lawyers are still going through [the legislation]. We’re no different to any other company. But if the government keeps down this path of trying to take away our intellectual property, we’ll be forced to go to court,” said Scott McIntyre, spokesperson for British American Tobacco Australia (BATA), the local unit of British American Tobacco.

“What company would stand for having its brands, which are worth billions, taken away from them?” he asked.

BATA holds more than 46% of the Australian tobacco market, with Philip Morris International Inc. and British-based Imperial Tobacco Group splitting the remainder. Philip Morris also supports legal action if necessary to protect its trademarks under the proposed laws.

The United Kingdom and Canada have considered similar plain-packaging schemes, while the New Zealand government said it will monitor the Australian experience.

Minimal risk?

Citigroup analysts, however, aren’t too concerned about the impact the proposed legislation will have on the sector.

“We anticipate only a moderate negative impact on the tobacco industry if this bill makes it into law, as we believe the majority of smokers will continue to buy their preferred brand as before. It may be that the number of young smokers declines in the future,” the analysts said in a research note.

Malawi Opens Tobacco Season; Farmers Complain of Low Prices

Malawi, the world’s biggest producer of burley tobacco, opened the 2011 season yesterday with President Bingu wa Mutharika asking malawibuyers to offer better prices.

“This year we have very good rains and with good care of the crop, we are sure of getting more revenue,” Mutharika said on MBC Radio during a live broadcast of the opening ceremony in the capital, Lilongwe. “The buyers should realize that farmers can only continue growing tobacco if they are paid prices beyond the cost of production,” said Mutharika.

Tobacco earnings fell 5 percent to $410.6 million in the year through Nov. 19 because of a drop in sales, the Bank of Malawi said Dec. 8. Prices averaged $1.90 per kilogram(2.2 pounds), higher than the $1.88 received in 2009, with prices declining in the second half of the season because of delayed confirmation from the buying companies’ customers and increased production in Zimbabwe.

Minimum prices for burley have been set at $1.80 per kilogram, down from $2 a kilogram set last year, Daily Times reported yesterday, citing Tobacco Control Commission Chief Executive Officer Bruce Munthali. The price reduction follows a drop in demand for the leaves by buyers, Munthali told the Blantyre-based newspaper. Malawi began setting minimum prices for the various grades of tobacco in 2007, after accusing merchants of putting growers out of business by offering them lower prices.

Tobacco is Malawi’s biggest foreign-exchange earner, accounting for 60 percent of all revenue earned from abroad.

By Frank Jomo in Blantyre via Johannesburg:

Tobacco Farmers Dreams Turn to Tears And Ashes in Afrika

Nairobi — Tobacco farming was introduced in Migori to help fight poverty by putting money in the pockets of farmers.

But today, this cash crop has left many of its growers worse off economically.

Disappointed farmers in Migori, Rongo, Kuria West and Kuria East districts have in recent times boycotted leaf deliveries in a bid to push for better pay.

The growers deliver their produce to BAT Kenya, Mastermind and Alliance One to prepare for a showdown.

Alliance One is a big tobacco merchant, exporting leaf to Europe and other parts of the world, while Mastermind and BAT Kenya make cigarettes locally.

The problem is that many farmers have put most of their land under the cash crop. As a result, they depend on the money earned from the crop to buy food and take care of their other expenses.

The farmers recently met and resolved to stop leaf delivery until they get better pay. Their leaders, Mr John Magaiwa, Mr Charles Nyangi and Mr Gesamba Mwita, said they will not relent until their plight is addressed.

In response, the companies increased the cost of the highest leaf grade to Sh103 a kilo, but the growers said they wanted at least Sh200. The poorest grade fetches below Sh20.

There are more than 20,000 farmers in the region. “We have been exploited for a long time and this time we are saying no,” said Mr Mwita.

Another grower, Mr Moses Mosabi, added : “Even though we need money to take our children to school, we are ready to keep our crop to give to other well-paying buyers.”

Migori MP John Pesa supported their demands saying they were genuine. “These people have been trapped in abject poverty for a long time yet the firms post big profits. They must be listened to,” he said.

But Alliance One staff accused politicians of inciting the farmers, saying the prices were being dictated by supply and demand in the world market. Mastermind employees in the area expressed similar sentiments.

“Some leaders want to win their sympathy by whipping unnecessary emotions. We believe sobriety will prevail,” said one company official, who asked not to be named because he was not authorised to talk to the media.

The companies are also feuding among themselves over poaching of tobacco. Middlemen also descended on the county, buying leaf from farmers at a throw away price and later selling it to the multi-nationals at exorbitant costs.

“They target the poor farmers who are looking for quick cash to pay fees and buy food,” said one farmer, Mr Samuel Kerioba, a former civic leader.

Alliance One Tobacco leaf director Patrick Kimani has protested at the move by middlemen, saying it stood to lose millions of shillings it gave out to farmers in loans for land development.

He asked for the intervention of the Provincial Administration to stop the menace.

By Elisha Otieno

Farmers to Get Cash for Tobacco in Zimbabwe

TOBACCO farmers are now getting a cash payment for almost all their deliveries after the Reserve Bank of Zimbabwe increased the cash payment threshold from US$2 000 to US$10 000 per sale.

Tobacco Sales Floor general manager, Mr James Mutambanesango confirmed the new cash threshold.

“RBZ has released a circular directing that the threshold be increased to US$10 000 per sale and that the threshold could be increased by another US$1 000 as the season progresses,” he said.

With tobacco selling at an average of US$2,56 per kg so far this season, farmers who deliver less than 4 000kg of the golden leaf at once, would get their payment in cash.

The US$10 000 threshold applies per every single sale made and farmers with more than 4 000kg can split their sale into two within the same day and still get US$10 000 per sale.

The next sale is not affected by the cash payment made for the previous sale.

The cash threshold makes it easy for mainly the small scale farmers with no bank accounts who have a previous record of spending nights on end trying to cash their cheques before going back to their farms.

There are, however, a few farmers who can deliver 4 000kg per season, let alone at a time.

Producing one hectare of commercial tobacco costs between US$8 000 and US$10 000, everything being done according to the book.

This means that to really make money farmers have to improve their yield levels per hectare and the same applies for all crops.

For instance, a farmer needs 14 bags of fertiliser at US$30 per bag, a standby generator, which requires 1 000 litres at US$1,40 per litre, two tonnes of coal at US$300 each, labour at US$100 per worker per month, among other costs like curing, handling and transport.

Dry land tobacco produces an average of 2 500kg per ha while irrigated tobacco produces an average of 4 000kg per ha and the price per kg is determined by the quality, which subsequently determines the profit margin.

Farmers’ Development Trust executive director Mr Lovegot Tendengu confirmed the figures.

“Yes, it costs about US$10 000 per ha, per average, everything being done properly with farmers getting a yield ranging from 2 500-4 000 kilogrammes per hectare,” he said.

“Zimbabwe has a good quality crop and farmers should get We also want to retain our position as one of the best producers of flue-cured tobacco,” Mr Tendengu said.

Tobacco Association of Zimbabwe first vice president Mr Guy Mutasa said the prices being offered at the floors this year were good and were expected to increase as the quality of the crop improved.

Farmers start by reaping the lower leaves which are normally of low quality and sell them to offset harvesting costs. They then sell the good quality as the season progresses, alongside the late reap.

Tobacco growers yesterday said they were happy with the improvements on service delivery at TSF including registration, auctioning and payment methods.

Marondera farmer Mr Nhamoinesu Mudhombo said he was satisfied by the service at the auction floors, especially the absence of long queues.

“I came yesterday and today my tobacco has already been bought. The process is a bit faster unlike the previous year.

“Last year I spent more than three days here, which was very expensive and I did not have the money,” he said.

Headlands farmer Mr Misheck Dick said he was happy in that there had been an improvement in the availability of tobacco wrappers.

“Last year we had problems with the packaging material which was constantly in short supply but this season we are buying on the open market and this is cheaper,” he said.

Despite the arrangement that farmers deliver their crop only after booking, some growers, especially the small ones, are still coming with their crop without having made prior arrangements.

Mr Mutambanesango said TSF and the Tobacco Industry Marketing Board agreed to set up an office at the sales floor to book such farmers.

“Booking is being done between 6am and 12 midnight to ensure all farmers who deliver their crop are able to sell the next day.

“Still there is no reason for one to stay at the floors. We have accommodation for farmers but they have to give good reasons for them to stay over at the floors,” Mr Mutambanesango said.

Elita Chikwati And Faith Mhandu

Interest in privatization of Bulgartabac Holding

About a dozen strategic and financial investors have declared interest in the privatization of Bulgaria’s state cigarette producer bulgar tobaccoBulgartabac Holding, according to Economy Minister Traicho Traikov.

Unofficial information reported in the Bulgarian media says that the bidders seeking to purchase Bulgartabac include companies from Bulgaria, Greece, and South Korea.

Traikov has announced that next week the government will announce its decision on the privatization method – i.e. whether Bulgartabac will be sold through a tender, an auction, or on the Sofia Stock Exchange – will be decided in the coming weeks. It was proposed by Citibank, the consultant preparing the sale of the state company. The decision has already been made but Traikov has declined to reveal it yet.

If Bulgartabac is privatized through the Bulgarian Stock Exchange, the government will not be able to impose its criteria for the future owner of the cigarette giant.

Bulgartabac, whose state management has been questionable in the recent years, is being put on the privatization table after its privatization has been mulled for years.

In January, Finance Minister Simeon Djankov reiterated earlier announcements that Bulgaria’s government is determined to go ahead with the planned sale of the country’s tobacco company, the biggest military plant and the minority stakes in electricity distributors.

The sale of Bulgartabac Holding AD, Sopot-based Vazovski Mashinostroitelni Zavodi or VMZ, and the minority stakes in the electricity distributors have been said to be a must-do task in 2011 due to the sorry performance of the state-owned companies.

The Economy Ministry revealed in January that the consultant Citibank has made preliminary inquiries with about 100 potential strategic and financial investors from around the world with respect to Bulgartabac’s privatization in order to make sure that all “serious” investors that are not aware of the sale of the Bulgarian cigarette company.

According to the Ministry, there is a sufficient number of companies interested in the privatization of Bulgartabac because it is an attractive asset even in a time of crisis.

The Economy Ministry said it wants to find a buyer for Bulgartabac by the summer of 2011.

In spite of declarations in April 2010 that Bulgaria’s Privatization Agency hoped to complete the sale of state-owned cigarette monopoly Bulgartabac in 2010, no such deal went through by the end of December 2010.

The consultant for the Bulgartabac sale, Citigroup Global Markets Ltd, was picked by the Bulgarian government in February 2010.

Two of the less profitable plants of Bulgartabac holding – in the cities of Plovdiv and Stara Zagora – were sold in 2009 through the Sofia Stock Exchange – for BGN 31 M and BGN 18 M respectively; the holding still owns the two larger and more consolidated factories in Sofia and Blagoevgrad as well as a number of commercial brands.

Draper buys Bethesda Tobacco

W. Curtis Draper Tobacconist, the oldest tobacco shop in the District, has acquired Bethesda Tobacco for an undisclosed sum.

Draper owners John Anderson and Matt Krimm announced the deal Tuesday, saying they will rename Bethesda Tobacco as W. Curtis Draper Bethesda.

They bought the store, 4916 Del Ray Ave., from current owner Michael Copperman. Bethesda Tobacco opened in 1994.

W. Curtis Draper, at 14th and G streets NW, has been in business since 1887 and has been profiled many times over the years, including articles in The New York Times and Cigar Aficionado.

Anderson and Krimm have hired Paul Spence, formerly mid-Atlantic regional sales manager for cigar manufacturer CAO International, as managing partner and general manager of their new Bethesda store.

By Jeff Clabaugh
Washington Business Journal

Chinese Dealers Start Hoarding Tobacco

BEIJING – Chinese tobacco dealers have started socking away cigarettes ahead of a probably increase in tobacco taxes, the Global Times reports. The State Administration of Taxation (SAT) announced last month that the government would jack tobacco taxes this year to curb tobacco use.

“Wholesale purchases of most cigarettes have soared since September and some of the best-selling brand cigarettes are in short supply,” said one tobacco store owner in Kunming, Yunnan Province.

Raising tobacco taxes is seen by some as the most effective way to control tobacco consumption, but other experts, including some smokers, don’t think tobacco tax hikes work all that well.

Tax rises for tobacco products are believed by some to be an effective method of tobacco control. However, some experts, as well as smokers, have cast doubts over the effectiveness of such a move.

A researcher with the Taxation Research Institute, which has ties to SAT, said cigarette prices were not increased much after the last tax hike because tobacco companies bore the burnt of the increase. In May 2009, China increased its tobacco tax by 56 percent.

Even if the tobacco companies absorb another tax hike, eventually the increase will trickle down to consumers, said researcher Hu Linlin with the China Tobacco Tax Research Group. “The government might apply unyielding administrative measures to raise cigarette prices in order to strengthen controls on smoking,” he said.

On Monday, the Chinese health ministry acknowledged that the country had many miles to go in tobacco control.

Tobacco adds fuel to Zimbabwe’s exports

Tobacco production is booming in Zimbabwe as small farmers attempt to cash in on high prices worldwide.African tobacco

Farmers have also been spurred on by Zimbabwe’s adoption of the US dollar following the collapse of its own currency, with 99 per cent of all tobacco grown in the country now exported.

Operators of a farm outside Zimbabwe’s capital Harare are harvesting a fine crop of lush 16 leaf plants to be smoked dry – the Virginia method of flavoring tobacco.

Last year the tobacco sold by growers was worth about $US274 million – this year that figure has reached almost $US500 million.

But despite the country’s booming tobacco industry, smoking remains a luxury few Zimbabweans can afford and very few have taken up the habit.

Andrew Matibiri, chief executive of Zimbabwe’s Tobacco and Marketing Industry Board, says more farmers are becoming involved.

“If you go back 10 years, we had 8,500 growers growing on average about 10 hectares each. This year we had 50,000 growing units growing on average one-and-a-third hectares,” he said.

After president Robert Mugabe’s land reform program kicked off 10 years ago, white-owned farms were seized and land redistributed.

Just who got the large and most fertile farmland remains a deeply contentious issue.

But when it comes to tobacco farming and small holdings, there are many success stories and greater distribution of wealth.

Douglas Mhembere, a war veteran and Mugabe loyalist, has a small holding outside Harare that comprises 160 hectares on which he farms cattle and tobacco.

He has 60 labourers and their families living on the farm.

He had a successful harvest and hopes his next crop, which has just been planted, will be every bit as profitable.

“What I did was, I just said ‘I must just go onto the land and get on my own’,” he said.

Mr Mhembere says that decision has helped change his life.

But in a country where land title is nowhere near decided, one major issue still hangs over Mr Mhembere’s head.

He has no papers for his land, and as a result no way to borrow money from any bank to improve his farm.

Because he has no official lease Mr Mhembere is like a squatter and has no legal rights to the land.

“That is the thing. I don’t have the papers,” he said.

And that remains the situation across the whole of Zimbabwe for all farmers on seized land.

By Ginny Stein
ABC News

Indonesian Tobacco Firms’ Profits Keep Increasing

Jakarta. Indonesia’s tobacco industry, it seems, has been immune to higher excise taxes, stricter smoking rules and regulations, and a growing campaign by anti-tobacco groups.

As Indonesians continue to light up, the tobacco industry simply continues to grow.

“In the future, pressure on the tobacco industry will become stronger as a result of the Health Law, which states that tobacco is an addictive substance that needs to be controlled by the government,” said Benny Wahyudi, director general of the agricultural and chemical sectors at the Ministry of Industry.

“But it will be a long time before it becomes a sunset industry, as it continues to survive and expand through innovation, increasing production and company efficiency,” he said.

Dating back to the early 19th century, Indonesia’s tobacco industry is one of its oldest and most profitable sectors despite being slapped with increasing taxes and vilified by the anti-tobacco lobby.

Today, with more than 65 million smokers — the third most in the world — Indonesia remains fertile ground for the tobacco industry.

Wahyudi said the government still saw the tobacco industry as having a key role in the national economy, given that it contributed much revenue and employed at least 824,000 workers.

From 2005 to 2009, the government’s excise tax revenue increased from Rp 33.3 trillion ($3.73 billion) to Rp 56.7 trillion, thanks to cigarettes, which account for 97.8 percent of all excise tax receipts.

The increases are largely due to the rising excise rate on cigarettes. Last year it went up from an average of 9.6 percent to 21 percent. And the government has announced it is planning to increase it again by an average of 5 percentage points in 2011.

These increases are said to be aimed at increasing collections as well as an attempt to limit tobacco consumption.

But it seems only the former objective is being met.

“Every year the government raises the tobacco excise, but tobacco firms’ profits keep increasing on the back of higher consumption,” said Cece Ridwanulloh, an analyst from Ekokapital Sekuritas.

Cigarette maker Sampoerna, the biggest player in Indonesia with a 28.8 percent market share, earned Rp 2.52 trillion in net profits in the first half of 2010, 14.8 percent more than in the same period last year.

Bentoel, whose market share has increased from 6.3 percent to 9 percent this year, recorded a hefty 386.5 percent increase in net profit in the first half of 2010, reaching Rp 112.60 billion.

Gudang Garam logged a 24.47 percent increase in first-half profit to Rp 1.78 trillion.

Cece said stricter regulations and higher taxes were simply not having an impact on major cigarette companies.

“With stricter regulations and higher tax, the tobacco industry is supposed to be heading toward becoming a sunset industry, but this is not the case in Indonesia,” he said.

“Tobacco production is increasing and it’s still attractive to foreign investors who want to tap the local market.”

While the House of Representatives has established a tobacco industry roadmap that would limit production to 260 billion cigarettes in 2015, production isn’t showing signs of slowing down.

The government is expecting cigarette production to reach 248.2 billion sticks this year, up from the 242.4 billion sticks produced the previous year, due to the improving economic conditions among consumers.

The profits made by the tobacco industry stand in contrast to resulting health costs.

The Indonesian Consumer Protection Foundation (YLKI) estimates that Rp 185 trillion is spent each year treating smoking-related diseases, or more than three times the income from cigarette excise.

The Ministry of Health estimates that 200,000 Indonesians die each year from smoking-related illnesses.

Wahyudi concedes that taxes are not enough to limit tobacco consumption.

“Increasing the tax on tobacco will not reduce the prevalence of smoking as long as there are still illegal cigarettes out there,” he said. “Smokers will find cheaper cigarettes or increase their spending on tobacco.

“The most effective method to curb the prevalence of smoking is enforcing, and adding more, tobacco-free zones.”

YLKI chairman Tulus Abadi says more than this is needed.

“The number of smokers will continue to rise rapidly without strong control,” he said. “Smoking prevalence among Indonesians aged 9 to 18 increased 14 percent last year, the highest in the world.”

The foundation has been pushing for advertising restrictions, putting images of diseases caused by smoking on cigarette packs and banning the sale of packets of cigarettes with fewer than 20 sticks to discourage low-income smokers.

The first two proposals are included in a Health Ministry draft regulation that is still being negotiated with, and objected to by, pro-tobacco sectors.

Ricky Pesik, from the Jakarta chapter of the Indonesian Association of Advertising Agencies (PPPI), said media would likely suffer from the regulation more than the tobacco industry itself.

The tobacco industry is among the top five advertisers in the media, in particular television.

Figures from Nielsen Media Indonesia show that in the first quarter of the year, Gudang Garam was the third-biggest buyer of television commercial slots, with total spending of Rp 73 billion.

“Television companies could lose a large income from tobacco advertising, but the more restrictions, the more creative advertising agencies would become,” Ricky said.

“The tobacco companies would find loopholes in tobacco regulation and exploit them. I cannot think of a new medium [in which to advertise] now, but they might surprise us.”

Tobacco farmers register

HARARE – At least 75 000 farmers are expected to register as growers in the 2011/11 season, up from 52 000 the previous season, Tobacco and Industry Marketing Board chief executive Dr Andrew Matibiri, has said.
So far more than 45 000 farmers countrywide have registered to grow tobacco in 2010/11 agricultural season ahead of the registration deadline at the end of the month. Growers are required to register with the TIMB annually. TIMB has embarked on a mobile registration exercise in tobacco growing regions to ensure that all farmers interested in growing the crop obtained grower registration numbers.
Dr Matibiri said they were projecting that the number of tobacco farmers interested to grow the crop in the next coming season to reach 75 000. “The enthusiasm to grow tobacco is very much there as evidenced by inquiries that we continue to receive. This year we had 52 000 registered growers and in the next season we are projecting that the figure could reach 75 000. To date about 45 387 growers have registered,” he said.
Dr Matibiri said they had also sold enough seed to produce seedlings for over 100 000 hectares compared to 67 000 hectares grown in the 2009/10. Meanwhile, he said sales were still continuing to mop up tobacco deliveries that had not been delivered prior to the closure of the marketing season last month. Tobacco has so far earned the country US$355,276,031 from the sale of 123 295 314 kilogrammes at an average price of US$2.88 per kg. Most of the crop delivered came through the contract system resulting in 80 575 384 kg being sold while 42 719 930 kg was obtained through the auction system.
Last year, tobacco raked in US$168 million from 58 million kg. Since liberalisation of the economy in 2009, the sector has registered an increase in the number of farmers interested in growing the golden leaf.

Darlington farmer relies on tobacco to make living

DARLINGTON – For four generations, the Galloway family of Darlington County has considered tobacco the lifeline that has kept the family farm strong. The farm was purchased by the family more than 50 years ago, and has since made a name in crops, especially tobacco.

Ryan Galloway is the fourth generation of his family to carry on the tradition of farming and said tobacco has made a very definite impact on the lives of those in his family.

“Tobacco has been the main source of income for us on this farm and has provided us with many things,” he said. “I haven’t seen one in a long time, but there were times when you’d see little bumper stickers on the back of trucks saying ‘tobacco money pays my bills‘ … and it’s done that.”

The Galloway farm is one of many across the Pee Dee providing the tobacco crops that help fuel the area’s economy.

Galloway said he’s concerned that recent efforts to cut down on tobacco use may have more far-reaching impacts than people imagine.

“If you keep taking away tobacco and tobacco money, then you’re going to be left with a lot more bills to pay and taxes,” he said. “Tobacco provides around $40,000 an acre … and that money goes into state and federal funds and gives us lower taxes. If you take that away and take consumption away, that goes down and taxes go up … so somebody’s got to pay for it.”

Galloway said he has noticed a slight drop in tobacco consumption over the years, but feels there will always be a market for tobacco. He emphasized that tobacco farmers are planting and harvesting a legal commodity and that individuals should make the choice when it comes to whether or not they use tobacco.

Galloway also said he felt it should be up to individual business owners to decide whether they allow the use of tobacco in their facilities and said efforts to ban it would have a negative impact on area farmers.

Though Galloway feels the increasing efforts to cut down on tobacco use will have some impact on the industry long term, he hopes to be able to continue on the family tradition of growing tobacco, and pass on the farming legacy for generations to come.

Reynolds American Consolidating, Upgrading Manufacturing Facilities

WINSTON-SALEM, N.C. — To maximize cigarette-manufacturing efficiency and expand smokeless tobacco production capacity, several operating companies of Reynolds American Inc. are making changes to their manufacturing facilities. A cigarette factory in Winston-Salem, N.C., and one in Yabucoa, Puerto Rico, will close, and production from those two older plants will transfer to R.J. Reynolds Tobacco Co.’s largest facility in Tobaccoville, N.C.

Meanwhile, American Snuff Co. LLC is expanding its smokeless tobacco processing and manufacturing capacity by investing in Reynolds American Inc.facilities in Memphis and Clarksville, Tenn. “Our operating companies are optimizing their manufacturing networks to increase efficiency, upgrade and expand some operations and reduce complexity,” said Susan Ivey, RAI’s chairman, president and CEO. “These changes make our companies more efficient in light of the declining U.S. cigarette industry and growth in smokeless tobacco. Consolidating production into fewer and newer facilities will also facilitate cost-effective compliance with new federal regulation of the tobacco industry.”

Cigarette manufacturing volume and employees will begin moving from R.J. Reynolds’ Whitaker Park plant to Tobaccoville this summer. Whitaker Park will cease manufacturing in mid-2011.

Cigarette production at an R.J. Reynolds Tobacco affiliate in Yabucoa will be transferred to Tobaccoville by the end of August 2010. About 60 manufacturing employees’ jobs in Yabucoa will be eliminated, and those employees will receive severance benefits. The company’s distribution operations in Puerto Rico are not affected by the plant closure. In Memphis, American Snuff Co. is expanding its manufacturing operations using property and a facility purchased last year.
Construction began in April, and the new facility will be fully operational in January 2012. The company’s current plant, built in 1904, will close in 2012. American Snuff Co. is also doing construction in Clarksville, Tenn., to increase its tobacco processing capacity. New tobacco receiving and processing operations and dry snuff manufacturing will begin in phases, and the facilities will be fully operational by early 2012.

“The decision to close a plant is never easy,” said Ivey. “These changes to our companies’ operations footprint address last year’s significant increase in the federal tax on cigarettes and new regulatory requirements. We must ensure that our companies are keenly focused on productivity and efficiency in order to continue to compete successfully in the years ahead.”

Independent of the changes to manufacturing facilities, Ivey also said work continues on determining the best way to redeploy R.J. Reynolds’ former headquarters building in Winston- Salem. The company’s real-estate advisors recently contacted a number of commercial, nonprofit and economic-development organizations to gauge potential interest in the iconic building, Ivey said, and discussions are expected to continue throughout 2010.

Reynolds American is the parent company of R.J. Reynolds Tobacco.; American Snuff; Santa Fe Natural Tobacco Co. Inc.; and Niconovum AB.

R.J. Reynolds Tobacco is the second-largest U.S. tobacco company. The company’s brands include five of the 10 best-selling cigarettes in the United States: Camel, Pall Mall, Winston, Doral and Kool. American Snuff s the nation’s second-largest manufacturer of smokeless tobacco products. Its leading brands are Kodiak, Grizzly and Levi Garrett. American Snuff also sells and distributes a variety of tobacco products manufactured by Lane Ltd., including Winchester and Captain Black little cigars and Bugler roll-your-own tobacco. Santa Fe Natural Tobacco manufactures Natural American Spirit cigarettes and other additive-free tobacco products, and manages and markets other super-premium brands. Niconovum markets innovative nicotine replacement therapy products in Sweden and Denmark under the Zonnic brand.

CSP, June 2, 2010

Increases wholesale prices on smokeless brands

RICHMOND, Va. — Altria Group Inc., the largest U.S. tobacco company, has announced to its trade customers a list price increasesmokeless tobacco of 10 cents per tin on each of its smokeless brands including the recently launched Copenhagen Long-Cut Wintergreen, according to a note to investors by UBS Investment Research analyst Nik Modi.

The list price on Copenhagen Long-Cut Wintergreen goes from $1.45 to $1.55 (a 6% increase), and the base Copenhagen and Skoal list prices go from $2.39 to $2.49 (4% increases). Husky list prices remained the same at $1.55, he said.

“We believe that share gains in MST [moist smokeless tobacco] remain Altria’s priority, as the company has stated on numerous occasions that they are targeting MST growth in-line with the overall category (6% to 7%). Altria’s decision to take price—even on their primary share vehicle in Cope WG—could be a sign that overall MST trends have been better than expected,” wrote Modi.

He added, “We expect Reynolds to follow Altria’s pricing actions in smokeless shortly, with Kodiak and Grizzly.”

Altria raised prices on all 18 of its cigarette brands on May 10. Altria’s Philip Morris USA division will charge wholesalers eight cents a pack more for Marlboro, Virginia Slims and other brands, said David Sylvia, a spokesperson for the company.

Richmond, Va.-based Altria held its 2010 Annual Meeting of Shareholders last week, the company said. Chairman and CEO Michael E. Szymanczyk said Altria used its mission and values framework to manage through last year’s challenging environment. Altria said it expects the first half of 2010 to be more challenging for income growth comparison purposes than the back half of 2010.

And he expressed confidence yesterday that the nation’s largest tobacco company can defend itself against a wave of smoker lawsuits in Florida, added a report by The Richmond Times-Dispatch.

Altria is “bullish” that it can successfully fight thousands of lawsuits filed in Florida against cigarette companies, Szymanczyk said.

“Litigation is part of this business,” he said after one shareholder, lawyer and tobacco-control advocate Edward L. Sweda Jr., asked whether the company would reconsider its practice of refusing to settle lawsuits, considering the scope of the cases in Florida.

About 9,500 individual claims have been filed in state and federal courts since the Florida Supreme Court decertified a statewide $145 billion class-action lawsuit in 2006.

Lawsuits against the company “remain a challenge,” Szymanczyk said. “But if you look at the past decade, the company has had success defending its shareholders’ interests.”

Last week, a Duval County, Fla., jury today ruled in favor of PM USA in a lawsuit filed by the family of a smoker following a 2006 Florida Supreme Court decision that decertified a class action but allowed former class members to file individual lawsuits.

“We believe that the jury correctly decided that the plaintiff failed to prove her case,” said Murray Garnick, Altria Client Services senior vice president and associate general counsel, speaking on behalf of PM USA.

At trial, the court allowed the jury to rely on general findings made in the decertified class action that are totally unrelated to the plaintiff in this case.

“The jury reached the correct result despite the fact that the trial court adopted an unfair trial plan that eliminated any requirement that the plaintiff prove that PM USA did anything wrong to recover damages,” said Garnick. “Each federal trial court that has reviewed the trial plan used in these state cases has found that they violate Florida law and are unconstitutional.”

About 4000 Engle-related claims are pending in federal court and have been put on hold pending a federal appeals court review of the state-law and constitutional issues that arise from allowing the plaintiff to rely on prior Engle jury findings.

The case is Gil de Rubio v. PM USA, et. al.

Of the Florida cases that have gone to trial, verdicts in seven lawsuits have gone against PM USA, according to the Times-Dispatch, citing company’s most recent quarterly report.

Meanwhile, Szymanczyk said Altria is seeking to work with the U.S. Food & Drug Administration (FDA) as the agency implements new regulations on tobacco products. Altria supported the legislation passed by Congress last year.

One of the company’s critics at the meeting questioned why Altria, in March, sought to remove four of the 12 members of a scientific advisory board that is studying issues such as the health effects of menthol cigarettes. “It seems there is a contradiction, when the company is trying to get rid of people who are concerned about public health and advising the FDA,” said Reverend Michael Crosby, a priest and tobacco-control activist from Milwaukee.

In its request to the FDA, Altria argued that the four panel members had conflicts of interest, including having served as paid experts for plaintiffs in lawsuits against tobacco companies. The FDA denied the company’s request to remove them from the board, said the report.

“We are participating” in the FDA’s regulatory process, Szymanczyk told about 130 shareholders who attended the meeting at the Greater Richmond Convention Center. “And part of participating involves representing shareholder interests.”

Altria directly or indirectly owns 100% of each of PM USA, U.S. Smokeless Tobacco Co., John Middleton, Ste. Michelle Wine Estates and Philip Morris Capital Corp. PM USA cigarette brands include Marlboro, Alpine, Basic, Benson & Hedges, Bristol, Cambridge, Chesterfield, Commander, Dave’s, English Ovals, Lark, L&M, Merit, Parliament, Players, Saratoga and Virginia Slims.. Moist smokeless tobacco brands include Copenhagen, Cope, Copenhagen Pouches, Skoal, Skoal Bandits, Skoal Pouches, Red Seal and Husky. Cigar brands include Black & Mild, Middleton’s, Gold & Mild and Prince Alberts. F

Tobacco contracts cut: Less supply needed with U.S. demand down

tobacco farmer
CYNTHIANA, Ky. – After years of faithfully supplying leaf to tobacco giant Philip Morris International, farmer Jess Burrier received a postcard thanking him for his contributions and telling him his service wasn’t needed this year.

“They were very courteous, but a Dear John letter’s still a Dear John letter,” said Burrier, who has seen the amount of tobacco he grows under contract shrivel from about 600,000 pounds two years ago to 20,000 pounds this year with another leaf buyer.

Kentucky, the nation’s top producer of burley tobacco, a common ingredient in cigarettes, could lose a fourth of its contracts this year, said Will Snell, a University of Kentucky agricultural economist specializing in tobacco. Many contracts also have been lost in North Carolina, South Carolina, Tennessee and Virginia as smoking continues to decline in the U.S.

U.S. farmers also are seeing more competition from overseas as worldwide burley production has grown in the past two years, Snell said. And, a 2009 federal law giving the Food and Drug Administration broad power to regulate tobacco has added to cigarette makers’ uncertainty, making them even more conservative about purchasing, he said.

The cutbacks mean farmers who’ve lost contracts might not be able to pay mortgages, and rural communities could lose jobs and income as farmers have less money to spend.

Some top tobacco companies acknowledged cutting contracts but wouldn’t say by how much.

“When volumes go down, you don’t need as much leaf across the board to manufacture the product,” said David Sutton, a spokesman for Altria Group Inc. – parent of Philip Morris USA, the nation’s top cigarette maker, which produces the Matlboro online. But even with cutbacks, he said Altria will buy leaf valued at more than $100 million this year from thousands of Kentucky burley and dark tobacco farmers.

R.J. Reynolds Tobacco Co. spokesman David Howard said the nation’s second-largest cigarette maker, whose brands include Camel and Pall Mall, is buying less burley through contracts because U.S. cigarette sales have dropped with higher excise taxes and smoking restrictions.

“We are simply doing what any business would have to do, and that’s keeping supplies in line with demand,” Howard said.

Philip Morris International, which is no longer tied to Philip Morris USA, also is buying less Kentucky burley this year, company spokeswoman Monica Montero confirmed.

The amount of contracted tobacco may plunge by 40 percent this year in Breckinridge County in western Kentucky, said Carol Hinton, the county’s agricultural extension agent. The reduction could cost growers about $2 million overall, based on a conservative 2,000-pound-per-acre yield, she said.

“Every day, people were calling saying, ‘I lost my pounds,’ ” Hinton said. “It was a month there that was just true heartache for people.”

In North Carolina, the biggest tobacco state, contracts for flue-cured tobacco, another cigarette ingredient, are down about 10 percent from last year, said Peter Daniel of the state Farm Bureau.

North Carolina farmers have known this would be a lean year since December, when Phillip Morris International closed a receiving station in Lenoir County, the heart of eastern North Carolina tobacco country. That left farmers stuck with about 25 million pounds of tobacco, although Japan Tobacco Inc. later bought some of it, Daniel said.

In Tennessee, some producers with contracts say it’s increasingly difficult to live with the terms.

John Rose, 45, a tobacco farmer in northern Middle Tennessee who has a Phillip Morris International contract, now must take his burley to Glasgow, Ky., a four-hour round trip, after a nearby receiving station closed.

Some Kentucky farmers without contracts still lean toward planting tobacco, which they could sell at a limited number of auctions.

“That really scares me,” said Gary Carter, the ag extension agent in Harrison County. “It’s an unknown. They’re going to be at the mercy of whatever someone wants to give them.”

The U.S. Department of Agriculture reported in late March that farmers in all the burley states combined intended to plant 97,800 acres, 4 percent less than a year ago.

Burrier, 52, said he’ll scale back from 110 acres of tobacco last year to 12 acres. Just two years ago, he planted 200 acres on his farm just outside Cynthiana, about 30 miles northeast of Lexington.

“This is the least amount of tobacco that I have ever raised on this farm,” said Burrier, who traces his family’s tobacco-growing heritage back a century.

The small contract won’t pay his mortgage, and the money he invested in tobacco setters and sprayers will largely go to waste. In the fall, he’ll only need two of his 15 tobacco barns for curing leaf; he’ll rent a few others to farmers who snagged larger contracts.

Still, Burrier doesn’t hold any grudges with Philip Morris International. Having prepared for this day, he has a sod business and grain production to fall back on, although he likely won’t earn as much without the tobacco contract.

“Philip Morris (International) is doing what they should do as a business,” Burrier said. “They’re taking care of their stockholders. If they did any differently, they wouldn’t be in business.”

Knoxnews, May 22, 2010

Cigar bars around Michigan get OK to sell food, drinks

LANSING — Michigan’s statewide smoking ban, which is to take effect May 1, will allow established cigar bars to sell food and drink, the state Department of Community Health (DCH) announced Friday.


But the law will not allow any new smoking cigar bars; they had to have been established by April 1.

And patrons in cigar bars can’t smoke cigarettes, pipes, so-called little cigars or any other tobacco products. Only tobacco-wrapped cigars that retail for more than $1 each can be smoked in cigar bars.

The rule clarification was sought by cigar bars that serve food and drinks. To qualify for the exemption, cigar bars must prove that at least 10% of their monthly income is from the sale of cigars and the rental of humidors.

“To fail to recognize how cigar bars will generate the other 90% of their gross annual income would be absurd,” DCH director Janet Olszewski wrote in a memo Friday.

She said the Legislature intended to allow eating and drinking in cigar bars when it wrote the new law. Tobacco shops and hookah lounges can’t serve food and drinks, according to the ban.

Gary Reed, a Lansing lobbyist who represents cigar bars, said he did not know how many cigar bars are in Michigan but guessed several hundred.

The smoking ban includes all workplaces, restaurants and bars and enclosed public places such as shopping malls, arenas and health facilities.

Smoking will be allowed on the gaming floors of Detroit casinos, and at cigar bars and tobacco shops that qualify under the rules. The casino restaurants and bars must be smoke-free.

The smoking ban does not apply to American Indian-owned casinos.

Tobacco dust seen to boost Philippines aquaculture industry

MANILA, Philippines – Thanks to tobacco dust, inland fish products from the Philippines may regain access to foreign markets.

Fish exports particularly milkfish and tilapia which used to be among the country’s dollar earners had been banned in the US and Europe after they were found to contain chemical pesticide residues due to the extensive use of chemical pesticides.

Officials of the National Tobacco Administration (NTA) which developed and commercialized tobacco dust are upbeat claiming the local aquaculture industry would bounce back to life with the use of tobacco dust.

Field trials conducted by the NTA in Bulacan and Bataan fishponds reportedly showed that tobacco dust, an organic fertilizer cum molluscicide, is a safe alternative to chemical pesticides.

The tobacco agency, in line with FIELDS, a special program of the Department of Agriculture (DA) to enhance agricultural productivity, has implemented projects including the development of other industrial products derived from tobacco, some of which have been commercialized under the administration of President Arroyo..

FIELDS which stands for Fertilizer, Irrigation, Extension, Loans, Driers and Seeds, was launched a few years ago by President Arroyo and implemented by then Agriculture Secretary Arthur Yap.


NTA Administrator Carlitos Encarnacion reported the agency’s production of an organic fertilizer which is now commercialized as Tobacco Dust Plus. It promotes the growth of ‘lablab’ (algae) that is used at the same time as “molluscicide” to eliminate snails and other pests in fishponds.

The environment-friendly product is being patronized by fishpond owners to replace chemical pesticides and holds great promise in making Philippine fish products safe and acceptable in foreign markets where they had been banned earlier for containing chemical pesticide residues.

A tobacco dust processing plant was established by NTA in Sto. Tomas, La Union in July last year and since then has been churning out dust materials from poor-grade tobacco leaves which upon application of a special technology yields a standard 1.3-percent nicotine content.

With an annual dust requirement of 400-million kilos by fishponds nationwide including 100-million kilos in Region III alone, market demand is encouraging, to the economic benefit of the farmers who mainly supply the raw material for the La Union plant.

Under NTA’s Integrated Farming and Other Income Generating Activities Project (IFOIGAP), fertilizer assistance was extended to an average of 15,738 tobacco farmer-cooperators tilling 10,230 hectares for rice and tobacco yearly .

For rice and high value crops, a yearly average of 1,247 farmer-cooperators using an average of 1,167 ha. were similarly assisted.


For irrigation, the tobacco agency provided 150 pump and engine sets to tobacco farmers’ associations apart from securing the National Irrigation Administration’s nod for the tapping of its “Balikatan sa Patubig” by tobacco farmers who are also engaged in rice farming.


Extension services provided by the tobacco agency involved education and technology training coupled by on-farm technical supervision.

An average of 48,484 tobacco farmers utilizing an average farm area of 29,671 ha. were assisted yearly for the past nine years. Of the figure, 32.46% were under the agency’s Tobacco Contract Growing System.

For the nine-year period covered by the report, an average of 1,893 farmers growing rice after tobacco on 1,517 ha. were similarly assisted yearly.

Their total palay harvest on the average reached 6,643,150 kilos a year valued at P99,494,312 .

Their production boosted the farmers’ income and helped ensure food security.

Six tobacco-based cooperatives with 156 members harnessed during the agency’s stewardship of the Multiline Food Processing Plant in Santa, Ilocos Sur were also assisted by NTA . In turn, they earned additional income for raising hogs and poultry.

Trainings on quality tobacco production were extended yearly to an average of 350 tobacco farmer-leaders and extension workers while the Cooperative Development Authority was tapped to conduct leadership training activities to farmer cooperatives officers.


An average of P157 million has been extended yearly in production assistance to farmers under the Tobacco Contract Growing Scheme (TCGS) or a total of P1.4 billion during the period. NTA tapped various funding sources including the buyer-firms, the DA’s Agricultural Credit and Productivity Corp., other government financial agencies, farmers’ cooperatives and local government units.

A P100-million loan assistance package for the rehabilitation or construction of curing barns has been approved for implementation by Yap which will serve the farmers in good stead as they continue producing tobacco.

The barn will be highly beneficial for its novelty. As a multipurpose grain drier cum tobacco curing barn, it is also applicable for rice, corn, beans, onions, vegetables, and garlic.

Apart from this, NTA has been defraying P39.5 million yearly for barn repair and fuel assistance costs benefitting 3,500 farmers.

The novel drier officially known as Grain Drier with Curing Barns will be available in two-months’ time, Encarnacion said.


The NTA along with the tobacco buying sector and the Bureau of Plant Industry produce an average of 750 kilos of market-preferred seed varieties annually to replace the old and degenerated ones for distribution to the farmers. 48,000 farmers are served yearly with the new seeds covering more than half of the target tobacco hectarage for the year. The agency likewise has seed provision or a buffer stock to be made available when typhoons destroy standing plants.

West Indian Tobacco Company Limited earnings growth slows

The West Indian Tobacco Company Limited (WITCO) has continued to show strong growth in earnings for another year. For the year ended December 31 2009, WITCO reported an EPS of $3.07, representing growth of 23.8 per cent as compared to $2.48 in 2008.

The directors have approved the payment of a final dividend of $1.64 per ordinary share payable on April 22 to shareholders on record at the close of business on April 13 2010, bringing the total dividend for 2009 to $3.06 (2008 – $2.48). The group traditionally pays out 98-100 per cent of earnings in dividends.

At the top-line, turnover increased 11.9 per cent to $891.2M and excise charges were 2.4 per cent higher than in 2008 at $225M. Correspondingly, net turnover increased 15.5% to $666.1M as WITCO was able to match the growth rate from the previous year.

Cost of sales increased 18.8 per cent to $170.9M for the period and gross profit increased 14.5 per cent from $432.7M to $495.197M. As a percentage, the gross profit margin improved slightly from 54.3 per cent to 55.6 per cent as displayed in Exhibit 1.

Overall, operating expenses were cut over the year despite increased distribution and administrative expenses. Operating expenses fell 2.8 per cent to $145.3M. As a result, operating profit moved from $283.2M to $349.9M, a 23.6 per cent gain. The operating profit margin increased from 35.6 per cent to 39.3 per cent. Profit after taxation rose to $258.4M from $209.2M, an increase of 23.4 per cent.

In 2009, the central statistical office recorded inflation in the ’alcoholic beverages and tobacco’ category of 14.0 per cent due to increased excise and duties levied in the national budget announced in September. WITCO was able to pass on most of this cost to consumers due to the relatively inelasticity of tobacco products. It is important to note that production volumes declined 2.7 per cent for the year, following a 7.6 per cent reduction in 2008.

Going forward these changes in the economic and business environment will pose a challenge to the group in growing at the top-line. Continued focus on cost-containment should benefit the group, but with operating expenses cut by 15 per cent in the last year, WITCO’s ability to further reduce expenses may be constrained.

The stock price has appreciated 23.5 per cent year-to-date to $40.01, significantly greater than the average market gains as investors move towards the better performing and higher dividend-yielding companies. WITCO has traded closely in line with the market price/earnings valuations over the past five years. The stock is now trading at a trailing P/E multiple of 13 times, above the market average of around 11 times. It is now somewhat expensive by comparison and the price may not be sustainable at the current levels. BOURSE revises its recommendation to a SELL.

Agostini’s Limited

Agostini’s Limited recorded an EPS from continuing operations of $0.38 in the quarter ended December 31st 2009. This represented a 5.6 per cent over the EPS of $0.36 earned in the comparative quarter ended December 31st 2008.

The slowdown in the local economy was reflected in lower revenues across all of the group’s operating segments. Turnover declined 2.1 per cent year-on-year from $230.2M to $225.3M in Q1 2010. Trading, the main component of revenue remained flat at $190.0M, while the construction and manufacturing segments declined 3.3% and 30.2% respectively as seen in Exhibit 2(a).

However, a reduction in expenses boosted operating profit by 8.2 per cent to $20.5M. This is seen in the improved operating profit margin of 9.1 per cent, from 8.2 per cent in the Q1 2009. Performance improved in the trading sector as operating profit increased by 19.7 per cent, partially attributed to improved service cost efficiencies from the combination of Agostini’s Marketing and Hand Arnold as shown in Exhibit 2(b).

Finance costs declined 16.3 per cent year-on-year to $3.5M as the Group’s liabilities continued to decline. Maintaining this lower level of finance charges will continue to assist the group’s overall profitability. Profits before taxation increased 15.1 per cent over the period from $14.8M to $17.0M. Even with a higher effective tax rate of 36.0 per cent in the quarter, as compared to 30.9 per cent in Q1 2009, the group’s profit from continuing operations gained 6.5 per cent to $10.9M from $10.2M.

Going forward, Agostini’s will continue to be impacted by the weak economic conditions in the T&T economy. In particular, the construction and property development areas will reflect this slowdown, while trading, which accounted for 84 per cent of revenues and almost all of the operating profits in the last quarter, should remain relatively stable.

Synergies from the acquisition of Hand Arnold should continue to provide cost benefits in the coming quarters. The pending merger of Superpharm, Smith Robertson and Company with Agostini’s could further improve the group’s efficiency as it focuses more on the core areas of pharmaceuticals and personal care.

Additionally, with the disposal of loss-incurring Agos Lighting, the group is anticipated to show improved profits this year. Based on the group’s estimated combined turnover of $1.2b and profits after taxation of $60m after the acquisition, EPS should be around $1.02 for the year.

At a share price of $7.50, the stock is trading at a forward P/E of 7.5 times as compared to its five-year average P/E of 10.2 times. The current market-to-book ratio of 0.96 is also attractive in comparison to the average of 1.41 over the past five years. BOURSE revises its recommendation to a BUY.

Tobacco growers exploiting loophole

Ontario tobacco growers who took federal buyout money are exploiting loopholes to keep growing the crop, an anti-smoking lobby charges.

While virtually every Ontario producer took the buyout last year, the province still produced the same size crop in 2009 as it did in 2008 before the incentive to get out of the business kicked in.

If the program isn’t getting growers out of the industry, it’s “a colossal waste of money,” says the federal Liberal health critic.

“Even if it follows the letter of the law, it’s not the spirit,” said Toronto MP Carolyn Bennett, a doctor. “I don’t think the auditor-general would be happy with the way the government is spending this money.”

Tobacco farmers were paid $286 million in compensation last year when the tobacco production quota system was scrapped and replaced with a new licensing system.

All but 18 growers took the buyout, averaging about $275,000, agreeing never to grow tobacco again.

But 118 growers were licensed last summer under the new system and an estimated 22-million-pound crop was produced, the same as in 2008.

Many people who hold the new tobacco licences struck deals with experienced growers who took the buyout, said Neil Collishaw of Ottawa-based Physicians for a Smoke-free Canada.

“Licences have been issued to non-farmers, sometimes living in distant communities, who provide legal cover to tobacco farmers who have been paid to stop growing tobacco, but are continuing to farm the same quantities on the same land,” he said.

Collishaw said people have told him about tobacco farmers growing the crop for relatives or friends who are tobacco licence holders.

The Free Press was contacted by a former grower and a neighbour of a grower who confirmed Collishaw’s claims about loopholes.

But Fred Neukamm, chairperson of the Ontario Flue-Cured Tobacco Grower Marketing Board, said the buyout program wasn’t aimed at eliminating all tobacco production in Canada.

He said growers who took the buyout are legally allowed to work for a licence holder.

With a major investment in tobacco land and equipment, he said, many growers had no viable alternative crop.

“People are stuck with debt and stranded infrastructure with no viable transitional opportunities, so they are forced to seek employment,” Neukamm said.

Last May, an Agriculture Canada deputy minister sent a letter to the tobacco board advising that farmers who took the buyout could work for a licence holder if the relationship was at “arm’s length” and any payments for services were at “fair market value.”

Agriculture Canada’s Patrick Girard said the quota buyout program was put in place “to assist those farmers exiting the program to pursue new opportunities in agriculture.”

He said any farmer who breaches the buyout program’s conditions will have to repay the assistance they received, plus interest.

Last April, federal Agriculture Minister Gerry Ritz moved to tighten up the buyout program by requiring licence holders to sign a declaration saying they’re not receiving money from the quota buyout program.

Farmers who took the buyout couldn’t be a partner or shareholder in a licensed tobacco operation.

But Collishaw said former growers still have the chance to get lucrative salaries from licensees to grow the crop.

The tobacco licensees were also eligible for a federal interest-free advance payout program offered to agricultural producers.

Neukamm said the tobacco board is working “rigorously” to prevent any abuse of the system, requiring full disclosure from licence holders who rent land or equipment from a farmer who took the buyout.

The tobacco marketing board, which once served the interests of thousands of tobacco growers, is now a small government-appointed agency that oversees and enforces tobacco licensing. Its employees have shrunk from 15 to two and its Tillsonburg headquarters has been sold.

Neukamm said Physicians for a Smoke-Free Canada appeared to be on a “witch hunt” for tobacco farmers and should devote more effort to urging the federal government to curb the growing market for untaxed contraband tobacco.

Collishaw said the number of tobacco licences granted in Ontario is likely to grow next year.

Neukamm said more licences are possible because the production of Ontario tobacco lags behind the demand by manufacturers serving the Canadian market.

Cigarette-tobacco processor Alliance One upbeat despite lower profit

Profit at global cigarette-tobacco processor Alliance One International Inc. (NYSE:AOI) of dropped nearly 37 percent for the firm’s nine-month reporting period ended Dec. 31, but the Morrisville-based company reports a stable crop and “solid” order book for early 2010.

Net income for the nine -month period was $60.3 million, or 68 cents per basic share, compared to net income of $95.1 million, or $1.08 per basic share, for the same period of the prior fiscal year, the company says.

Cutting into profits, the firm says, was a one-time $40 million pretax debt retirement expense – $23.5 million of it in cash – paid out during the period because of a July-August 2009 debt refinancing.

“Volumes and sales were in line with our expectations,” says CEO Robert E. Harrison. “Looking forward, our order book is solid, although the operating environment will remain dynamic. Global production for the next crop cycle is currently stable, though recent flooding in Brazil and dryer weather in Malawi will impact those markets.”

For the nine months ended Dec. 31, operating income increased $16.3 million, to $179.3 million, thanks to stable revenues and reduced direct costs compared to the prior year, the company says.

Alliance One processes tobacco for markets in South America, Europe and Africa.
Triangle Business Journal
By Lee Weisbecker
February 9, 2010

Zimbabwe: Farmers Ready for Tobacco Marketing Season

TOBACCO farmers are ready for the 2010 tobacco-marketing season despite the fact that the season is opening almost two months earlier than usual.

Two of the country’s three main floors — the Tobacco Sales Floor and Zimbabwe Tobacco Auction Centre — will open their doors on February 16, the first day of this year’s marketing season, while contract sales will start the following day.

In separate interviews, representatives of farmer organisations expressed confidence that farmers will be able to deliver come Wednesday next week.

Tobacco Growers’ Trust chairman, Mr Wilfanos Mashingaidze said that the farmers were ready since they were the ones that had requested for the floors to open early.

“Each year most small-scale farmers will have by this time finished preparing their tobacco for the market and most of them had to keep the crop for two to three months until the floors open.

“This year it is the same and it is these farmers who will be the first to bring their tobacco to the floors because this is what they have been calling for,” he said.

Mr Mashingaidze said the early opening of the floors was a blessing to mostly resettled farmers who did not have proper waterproof facilities to store their tobacco.

Zimbabwe Farmers Union director Mr Paul Zakariya said that farmers were ready to sell their tobacco and they expected the same trend as was the case with previous seasons.

He said that most of the farmers that were ready to come onto the market were those that grew the irrigated crop.

“As you might be aware tobacco has two types, the irrigated and dryland crop and what is ready now is the irrigated crop which constitutes about 15 percent of the total tobacco crop grown in the country.

“The irrigated crop is normally grown by those farmers that have potential so we expect the same batch that usually comes through during the first week of every season,” he said.

Elsewhere officials at the floors said that they would be ready to open the floors when sales commence on February 16.

“We were caught off-guard by the announcement but we are running around to put everything in place ahead of the opening date but we will get there,” said one of the officials who asked not to be named.

The official said that their main concern was the engagement of seasonal staff that would receive and handle the tobacco as it gets to the floors.

“We have started advertising for such staff and between now and next week we should have sufficient staff.

“As for sales bookings it is a bit early to give you an indication we will have a clearer picture next week,” said the official.

According to a statement issued by the TIMB, bookings opened on Thursday last week while auction sales will be conducted twice a week on Tuesdays and Fridays.

A total of 77 million kg of tobacco is expected to go under the hammer this year up from 42 million kg last year. A total of 65 202 hectares has been put under tobacco this season of which 11 000ha was under irrigation.

The 77 million kg is however shy of the target of between 80 million-kg and 100 million kg of tobacco initially projected to be grown this year.

About 45 percent of the 77 million kg is set to be sold under auction with the balance being sold under contract.

There were 28 000 farmers that sold their tobacco last year and the TIMB has so far registered 21 000 farmers.

New Marketing Option Offered To Tobacco Farmers

LOUISVILLE, Ky. — The Kentucky-based Burley Tobacco Growers Cooperative Association has started a new venture to give farmers another option to market their leaf.

The new business, called US Growers Tobacco Co., will provide a place in Lexington where farmers can have their tobacco stored, processed and marketed.

Burley co-op President Roger Quarles said Thursday that the group anticipates a considerable amount of tobacco without an apparent buyer other than a handful of auction markets.

Quarles said the new company is prepared to accept up to 2 million pounds of leaf.

The new venture will sell the tobacco for international and domestic markets. Farmers will be paid when their tobacco is sold, and will pay fees to the new company.

Tobacco company gives to GOP funds

Once again, the tobacco industry is weighing in on the side of Republicans in Oregon legislative races. New disclosure reports show that Philip Morris, one of the industry giants, gave $13,500 each to the House and Senate GOP caucus funds.

While this is not game-changing money, it’s bigger than your typical corporate contributiion to a legislative committee.

The company did give $1,000 to a Democratic legislator, Rep. Terry Beyer of Springfield. But if you scroll down this list of contributions from the 2008 campiagn, you’ll see the company sides almost exclusively with Republicans.

Democrats earned the industry’s enmity by pushing through a tough indoor smoking ban in the 2007 Legislature as well as a big tobacco tax increase that voters later rejected.

By Jeff Mapes, The Oregonian
November 30, 2009

South Windsor Tobacco Wholesaler Plans Expansion

A South Windsor tobacco company that has been in business since 1955 is asking the town to approve its plan to add a 12,300-square-foot addition to its existing facility on Sullivan Avenue.

A representative of The Nuway Tobacco Co. will present the proposal today to members of the town’s architectural design and review committee. The advisory committee is scheduled to meet at 5:45 p.m. in town hall, 1540 Sullivan Ave.

The application, submitted to the town Nov. 9, is pending before the planning and zoning commission, Michele Lipe, the town’s assistant director of planning, said Wednesday. Lipe, who also is a member of the design review committee, said the committee’s role is advisory to the planning and zoning commission, which is scheduled to take up the application at its meeting on Tuesday.

The application is on file in the town planning department and is available for public inspection.

Lipe said the design review committee will hear a brief presentation and review the plan. The committee will then submit its recommendations to the planning and zoning commission.

Nuway Tobacco is a tobacco products wholesaler that specializes in cigars and related products.

Copyright © 2009, Courant

Capital upgrades Egypt’s Eastern, Oriental Weavers

CAIRO, – CI Capital Research said on Tuesday it had upgraded its ratings for Egyptian tobacco monopoly Eastern Company (EAST.CA) to “buy” from “underweight” and on carpet maker Oriental Weavers (ORWE.CA) to “buy” from “hold”.

CI Capital said in a note that Eastern had maintained a 4 percent 4-year compound annual growth rate on revenues and 16 percent on earnings, and traded at a forward price-to-earnings ratio of 7.3 times.

“The company’s operation proved its resilience to the prevailing economic slowdown through its sustained revenue growth,” CI Capital said, adding that it had raised its long-term fair value on the share to 155 Egyptian pounds ($28.32) from 136 pounds.

It added that Eastern’s EBITDA margin improved in fiscal year 2008/9 on the back of a move toward making higher-margin foreign brands for multinationals such as British American Tobacco (BATS.L) and Philip Morris (PM.N).

The note added Eastern could see further margin improvements once it completes a move to a new 5.5 billion pound complex in 2012.

Eastern reported unaudited net profit of 151 million pounds in the three months to end-September compared with 148 million in the same period a year earlier. Shares were 6.2 percent down at 118 pounds by 1208 GMT.

CI Capital said it had raised its target price on Oriental Weavers, the world’s largest machine-woven carpet maker, to 40.5 pounds per share from 37.5 pounds, but cut its long-term fair value estimate to 46.3 pounds from 48.3 pounds.

It said Oriental Weavers produced solid performance in the first half of 2009 with stable revenue and earnings growth, adding that it traded at a low price-to-earnings ratio of 7.3 times, based on 2009 estimated earnings.

Oriental Weavers diverted unutilised export capacity to meet growing local demand, and would complete a new industrial complex by 2017, CI Capital said.

Oriental Weavers posted a 5 percent rise in net income for the first half of 2009 to 163 million pounds, compared with 154 million pounds in the first half of 2008. Shares were 2.3 percent down at 31.31 pounds by 1208 GMT. ($1=5.472 Egyptian Pound)

November 3, 2009


SOUTHWICK, Mass. — They’re among the lucky few, John, Fred and Dave Arnold. There’s a good supply of crisp broadleaf tobacco drying in their 14 curing sheds and during the next couple of weeks they will be pulling it down, bundling it up and selling it for the best price they can get. Pretty much what their family has done every year since the 1830s in the Connecticut River Valley.

There is no better place in America to grow broadleaf and shade tobacco, the kinds used for premium cigar wrappers and binders. But these are troubled times along New England’s own tobacco road, about 75 miles straddling western Massachusetts and Connecticut.

A disastrous growing season plagued by crop viruses, combined with sagging cigar sales, has left many growers reeling.

For the Arnold brothers, it wasn’t the greatest year, but it could have been much worse. Their farm could have been almost anywhere else in the valley.

“We were south enough to avoid the problems of the farmers north of us and we were north enough to avoid the problems of the farmers south of us,” Dave Arnold said.

Most of the problems, anyway. The Arnolds’ business partner, John Coward, says not all the leaves are as thick as buyers might want them, a byproduct of persistent early season rains. He points to some leaves that bear greenish-yellow splotches along their veins, a telltale sign of disease that ravished the crop elsewhere in the valley.

Leaves like those won’t be wrapper quality, Coward knows. Certainly not for some of the finest and most expensive cigars in the world, which is what they’re grown for in the first place. But he is philosophical.

“Maybe not the best crop we’ve ever had,” he said. “But it beats insurance.” While most tobacco farmers carry some type of crop insurance, it’s rarely enough to cover their losses.

Broadleaf and shade tobacco have been grown successfully in the Connecticut River Valley since pre-Colonial times, yet even farmers are hard-pressed to explain what makes the valley so unique for this crop. The climate, it seems, is just right and the soil is light and easily drainable.

International competition comes from growers in several other countries, including Sumatra, Honduras, Ecuador and the Dominican Republic.

Tobacco sheds, or barns, are hulking yet oddly graceful structures that have dotted the valley’s rural landscape for generations. Many now stand abandoned and decaying, silent testament to a vanishing era.

While the acreage devoted to tobacco in the valley has been declining for more than a half century, the cigar bar craze of the 1990s rekindled demand for premium, handmade cigars and brought record prices. The market has long since cooled off.

Norman Stein, executive director of the Cigar Association of America, said about 271 million premium, handcrafted cigars like those wrapped with Connecticut River Valley tobacco were sold in 2008 in the U.S., about 5 percent of all large-cigar sales. About 334 million premium cigars, or 9 percent, were sold in 1998.

While there are still more premium cigar smokers than before the cigar bar craze, “cigar smoking remains very much an occasional pastime,” Stein said.

If market pressures weren’t enough, nature dealt growers a punishing blow in 2009.

A stew of viruses carrying names such as potato virus-y, tobacco etch, and tobacco mottling virus attacked the plants, ruining the leaves.

The viruses, which appeared in the past but not to this extent, likely wintered in uncultivated potatoes, transmitted to tobacco by tiny aphids that feed on both, said Dr. James LaMondia, chief scientist at the Connecticut Agricultural Experiment Station in Windsor, Conn.

“I’ve seen bad years but this is probably the worst, particularly in Massachusetts,” LaMondia said.

“About a week before we were going to harvest, the leaves started to get all puffy and there was no way they could make cigars out of them,” said Joe Czajkowski, a farmer in Hadley, Mass., in the heart of the northern valley. He grows other crops and was insured for some of his losses.

As the disease progressed, the leaves turned a sickly yellowish color.

“There was nothing you could do … we took care of the crop, but there was nothing that would make any difference,” he said.

In the southern valley, in Connecticut, the culprit wasn’t so much disease but heavy rains that in some cases literally drowned the tobacco, or produced fungi that caused root rot. And there were hail storms blowing holes like shotgun pellets in the leaves.

U.S. Department of Agriculture figures show that the valley’s tobacco acreage is about 10 percent of what it once was.

In 1949, 26.3 million pounds of tobacco were harvested from 19,500 acres in Connecticut; 13.6 million pounds were harvested from 8,600 acres in Massachusetts. In 2008, about 3.5 million pounds were harvested from 2,600 acres in Connecticut, while only 968,000 pounds were harvested from 690 acres in Massachusetts.

While the exact dollar value of the crop is not known, it could be estimated at nearly $30 million, based on average prices.

The USDA expects this year’s production to drop to 594,000 pounds in Massachusetts and 2.4 million in Connecticut.

The Arnolds and Coward together employ about 80 seasonal workers, most of them local high school and college students paid about $9 to $10 per hour. Many growers rely more heavily on temporary overseas workers, including many from Jamaica, who must be housed as well as paid.

Coward said while it might cost him on average about $500 to $600 per acre to grow pumpkins, tobacco costs about $5,000 to $6,000 per acre to grow.

Planting begins in April with harvesting generally in August. It is a delicate process with each plant — or in the case of shade tobacco, each leaf — picked individually. The leaves are hung to dry for several weeks in the sheds, then pulled down by hand and bundled for sale in the early autumn. It may be Thanksgiving before the entire crop is sold to buyers, who will ship to overseas manufacturers where the leaves are rolled into cigars.


Nicotine Withdrawal-at 65 Miles per Hour

We’re hearing more about bans on smoking in cars with kids aboard, smoking bans in rental cars, and even outright bans while driving alone.

One must wonder about the expertise, if not the sanity and humanity, of those who concoct such laws. It takes no effort to just search up “Symptoms of tobacco withdrawal”. If this information is not acted upon by automobile safety organizations, at least, everyone on or near the roads when these laws kick in are endangered—if, that is, anyone obeys the laws. Lawmakers must love law-breakers; they create tens of thousands of them almost every day.

Here’s one item from a British medical web site about tobacco withdrawal symptoms. It may be better to have a beer-drinking cell phone user driving near you—or passing your kids on the sidewalk—than an obedient smoke-abstaining driver.

” A smoker’s nervous system becomes accustomed to functioning with nicotine.

When you stop smoking, the reduced nicotine intake will disturb the balance of the central nervous system, causing withdrawal symptoms.

The most common withdrawal symptoms are:

* cravings for tobacco
* irritation
* anger
* weight gain
* concentration problems
* depression
* headaches
* fatigue
* constipation
* restlessness
* insomnia
* dizziness
* anxiety.

Fortunately, the majority of these symptoms tend to disappear after a few of weeks. Some people may experience cravings, concentration problems and an increased appetite over a longer time period. ”

Here’s another web gleaning that includes drowsiness…but personal experience has been that the sleep, while driving, came on without the usual tired eyes and head-nodding warnings. I happened to give up smoking that morning because the price went up to about a dollar a pack. We survived only because there was a “we”…as my frantic passenger woke me up in time with her fists and serious screams. And this was not late at night or after a long tiring drive.

” Withdrawal symptoms can include anxiety, irritability, poor concentration, restlessness, craving nicotine, stomach problems, headaches and drowsiness. ”

Compare all that to the physiological benefits of tobacco…the reasons the plant has been smoked for about ten thousand years.

Appetite Suppression


Stress Relief

Digestive Relief

Pain Relief

Symptomatic relief for Alzheimer’s, Parkinson’s, and other such pathologies

Anti-blood clotting.

Additionally, having snacks, coffee and juice, changing radio stations—and having smokes—on long drives are ways to keep the drive interesting—to prevent “highway hypnosis” that can put you right up the tailpipe of the vehicle in front. Since tobacco is an appetite suppressant, it likely has positive bearing on the syndrome where one becomes drowsy after big meals.

Because it is currently heresy to even think of tobacco health benefits, one must pretty much search up each benefit separately—then wade through the anti-smoking “science” to get anything objective. Top clues to objectivity are if tobacco pesticides or dioxins in the smoke are mentioned. If a scientist doesn’t know about, or fails to mention those inconvenient, though integral, topics, that’s it for any chance of trustworthiness.

A bottom line here is that the benefits of smoking remain despite contamination of typical cigarettes with some of the most health-damaging industrial substances on the planet…including dioxin-delivering chlorine and even carcinogenic levels of radiation from certain fertilizers.

Bottom line II is that making smokers go Cold Turkey when they get behind the wheel of an inherently dangerous vehicle presents a certifiable danger to that driver, passengers, other drivers and passengers, and any nearby pedestrians—or livestock, trees, or utility poles.

If police are to be exempted from any Smoking-In-Cars laws for the sake of stress relief, as U.S. troops have been exempted by the Pentagon for the same reason, officials will have their work cut out explaining that police can have the stress relief and other benefits, but civilian drivers cannot.

On the other hand, if police are barred from smoking in their cruisers, we will all be faced with Cold Turkey cops, irritable, angry, anxious, dizzy, constipated, hungry and the works . Also, a brand new door will have been opened for another “probable cause” reason to stop and check cars—even if the driver has an unlit cigarette or a lollipop stuck in his or her mouth.

And then, what about smoking in convertibles?

Will traffic accident inspectors be obliged to record that the cause may be “TWS”– Tobacco Withdrawal Syndrome”?

Can road-rage perpetrators use that ban-created syndrome as a defense?

Consequences like these are results of unjust and scientifically groundless laws—laws intended to scapegoat and punish the victims of horrifically-contaminated smoking products for the crimes of the perpetrators, namely, cigarette manufacturers, tobacco pesticide manufacturers, pharmaceuticals that make both tobacco pesticides and non-tobacco cigarette additives, fertilizer producers, chlorine interests, and all of their insurers, investors, and sold-out henchpersons in public government.

Blaming the victims is a distraction from those industrial crimes, but the war on smoking is also largely about removing nicotine from the public domain so that it becomes a Controlled Substance for exclusive use by pharmaceutical and related industries.
It is not far-fetched, in this prohibitionistic, Talibanesque climate—and considering the limitless power of those pharms, chemical firms, insurers, and other entities—to expect that one day, to respond to the nicotine withdrawal problems noted above, anyone who has smoked, lived with a smoker, or who got hit with whiffs of “second-hand smoke”, will simply be forbidden from driving until six months after exposure. Who can oppose laws that are “for our protection” or “for the kids”? Absurdity feeds on absurdity.