Ahead of Sri Lankaโs tobacco industry ban of 2020, the determined industry struck back with its first ever research report directly from its frontlines-the farmer community- unveiling it in Colombo on 26 June.
โAbout 200,000 farmers are directly involved in tobacco cultivation and they will be required to change to alternative cropsโ said the Minister of Industry and Commerce Rishad Bathiudeen on 26 June in Colombo. Minister Bathiudeen was addressing the launch event of tobacco farmer research report titled โFarmer Perspectives on Proposed Tobacco Growing Ban and Opportunity to Diversifyโ by Dr. Chatura Rodrigo of Green Space Consultancies (GSC).
The ban on tobacco cultivation in Sri Lanka is expected to start from 2020. Importation of cigarettes, and tobacco also will banned from 2020. 500,000 are employed in this sector โdirectly and indirectly.
โThe proposed new crop models by Dr. Chatura Rodrigo are commendable since they recommend high income export crops such as Okra for these tobacco farmers so that their high (profit) margins shall continue and shall bring positive benefits to the exports sector as well. Therefore we believe that this โcrop switchingโ will have only minimal effects if these models are used by tobacco farmersโ said Minister Bathiudeen.
Tobacco expert panel at the event indicated that Tobacco is considered as an Industrial Crop, more than a commercial crop and since the bulk of the harvest is used for nicotine products, it immediately ends up in industrial/machine processing, unlike many other commercial crops. Among all types of full time farmers in Sri Lanka, tobacco farmers are one of the most profitable, earning regular margins of 20% or higher. โIt is not uncommon to find some tobacco farmers driving SUVs in Sri Lanka and some of them sending their children for overseas studies, including to UK. Many leading tobacco farmer have well established value chains and this could be easily used in diversification to alternative, high margin cropsโ said a farmer representative at the session.
โFarmers who grow tobacco for cigarette manufacturing are used to forward contracts with guaranteed prices and a market place; therefore, they expect a value chain that provides them the same conditionsโ said Dr. Chatura Rodrigo and added: โHowever, farmers believe they need support from the government in identifying feasible diversification options. Policies affect either the demand, supply or both, of goods and services. What is needed is evidence-based policy making. A proper research is needed to understand and quantify possible impacts. Then, alternative income sources including crop diversification needs to be evaluated upon taking market conditions in to consideration-the Policy change has to be dramatic.โ
The GSCโs research report proposes four models of diversification of Lankan tobacco farming ahead of 2020 ban; tobacco-cash crop model for export oriented value chains, tobacco-cash crop model under Good Agricultural Practices (GAP) value chain for EU, tobacco-organic cash crop value chain aimed at the export market, and tobacco specific fruits aimed at local manufacturers under guaranteed prices. The report recommends that the following three cross cutting themes could be used to make the above four models even more profitable-incorporating animal husbandry, Gliricidia cultivation and aquaculture/ornamental fisheries.
According to Minister Bathiudeen more than 3300 metric tonnes of tobacco are produced in Sri Lanka. When it comes to cultivation, only a very small percentage of lands are used -at 0.07 percent of all agricultural lands only- by tobacco, a factor which helps to speed up any proposed diversifications.
Leader of All Ceylon Makkal Congress