Philip Morris eyes Mindanao for Virginia tobacco expansion

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After seeing promising results from its pre-commercial launch, Philip Morris Fortune Tobacco Corporation (PMFTC), a private local manufacturer, is now seeking to expand its Virginia production in Mindanao.

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In a statement, National Tobacco Administration (NTA) Administrator Edgardo Zaragoza said PMFTC informed them of its planned expansion of Virginia tobacco production in the region following the success of the company’s experimental farms in Misamis Oriental.

“Though Ilocos region has a vibrant tobacco industry, private tobacco firms continue to search for areas to plant tobacco, particularly the Virginia type,” Zaragoza said.

“Apparently, one good choice is Misamis Oriental in Northern Mindanao, chosen for its vast fertile land and good climatic condition,” he added.

Tobacco farmers in Misamis Oriental—particularly in the municipalities of Opol, El Salvador, Alubijid, Laguindingan, Gitagum, Libertad and Initao—have been growing the Batek/Native variety only.

With the area expansion for Virginia tobacco, the NTA chief also expects the continuing process of improving the quality of tobacco leaves, adding that enhanced quality would make Philippine tobacco very competitive in the world market.

He noted that increases in tobacco production over the past two years have been driven by expansion in area and increased yields, with an increase of 4.46 percent from 2012 to 2013.

PMFTC established in January 2012 its first Virginia tobacco experimental farm, covering 10 hectares in barangay Ane-i, Claveria, an interior municipality in the eastern part of Misamis Oriental.

According to PMFTC, the initial result of the trial was very promising, so they proceeded to the pre-commercialization phase. Some 113 farmers representing a total area of 58.27 hectares were involved in the second phase, which ended October last year.

PMFTC extended production assistance, including tobacco seedlings, to the farmers. After harvest, the company bought the fresh tobacco leaves from the farmers, and did the flue curing using the six barns it constructed with slabs from sawmills.

The first batch of transplanting for the commercialization phase was conducted in November 2013. The company practiced staggered transplanting of K326 and PVH 2254 varieties, from November 2013 to April 2014, covering a total area of 200 hectares.

Based on a survey conducted by the NTA through its outreach station in Mindanao, most farmers in Claveria are willing to shift to tobacco farming as they can avail production assistance from PMFTC. They said that they no longer worry about their post-harvest activities since the company will buy the freshly harvested leaves from the growers.

Aside from the promise of a bigger income from tobacco farming, the farmers were also optimistic about the employment opportunities provided by the tobacco firm’s expansion program.

In a related development, the NTA has conducted a dialogue on Friday between tobacco farmers and buyer firms in Ilocos Sur to discuss and resolve matters regarding present tobacco trading operations.

Present during the meeting were Gov. Ryan Singson of Ilocos Sur and 29 mayors of tobacco-growing municipalities in the province.

During the event, tobacco buyers were given an opportunity to enlighten the farmers and the local executives on issues besetting the industry particularly those concerning the prices of leaves.

The NTA called for the meeting to clarify issues and allegations of low prices in trading centers.

Zaragoza said that while there are complaints from Ilocos Sur farmers involving tobacco trading that have reached the agency, the said complaints are common, like disagreements on classifications and prices.

“These issues, however, have been addressed by the NTA in its continuing dialogue with the farmers and by the intervention of NTA extension workers in different trading centers in Ilocos Sur,” he added.

Prices per kilogram of all tobacco types traded locally have a P6 increase across all grades this year. And as of latest NTA data (April 22), average buying price for Virginia tobacco leaves per kilogram in Ilocos Sur is P72.47, or above the average floor price level of P65.44 per kilogram.

Zaragoza said, however, that the average price is slightly lower than last year’s due to the poor quality of tobacco leaves produced as a result of inadequate rains and hot climate.

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5 Comments

  1. For once, we hear of positive things about the tobacco industry… all we’ve been hearing about lately is the failure of the STL, a local tobacco brand allegedly cheating on taxes, and so on. This expansion is a good and welcome news for the industry.

  2. Benedict Cordero on

    “With the area expansion for Virginia tobacco, the NTA chief also expects the continuing process of improving the quality of tobacco leaves, adding that enhanced quality would make Philippine tobacco very competitive in the world market.”

    It just needs to be said… Companies like PMFTC need to be commended for their contribution to the local tobacco industry. Good job!

  3. Dina Dela Cuesta on

    PMFTC’s expansion will bring more employment opportunities for the tobacco farmers and will yield more income from tobacco farming. This is welcome news from a company who plays by the rules and helps out the tobacco industry greatly.

  4. Good to hear of this expansion by PMFTC. This will be good for local farmers and will be beneficial to the tobacco industry as a whole. We’ve been hearing a lot of negative things concerning the industry lately, with the STL failing miserably in its goals and some local company allegedly cheating on taxes… It’s good to hear some good news for once.

  5. This is a welcome news, especially after reading about a certain Filipino owned tobacco company that’s been cheating the government for many months.