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Manila Bulletin devider Business devider Trade & Industry devider NTA prevents tobacco buying freeze amid oversupply fears

NTA prevents tobacco buying freeze amid oversupply fears

Published May 27, 2026 03:33 pm
(Manila Bulletin file photo)
(Manila Bulletin file photo)

National Tobacco Administration (NTA) said it has secured the commitment of traders and cigarette manufacturers to purchase all flue-cured Virginia (FCV) tobacco leaves produced this season to protect farmers from a potential buying freeze amid a projected oversupply of the commodity.

In a statement on Wednesday, May 27, NTA said FCV tobacco leaves produced in Ilocos Region and Abra province are expected to post an oversupply of around five million kilos this year.

The projected volume is about 27 percent higher than the 18.05-million-kilo buying commitment of traders and companies for this year’s trading season.

NTA Administrator and Chief Executive Officer (CEO) Belinda Sanchez said this makes it necessary to prevent a “stop-buying” situation to ensure farmers can still earn from their harvests.

Following negotiations, she said traders and tobacco firms committed to buying all locally produced tobacco “at reasonable prices” based on the approved floor prices.

Under this year’s trading season, approved floor prices for FCV tobacco range from ₱62 per kilo for reject-quality leaves to as high as ₱98 per kilo for Class AA leaves.

At present, the highest buying price for prime-class FCV tobacco has reached ₱105 per kilo, down 19 percent from the peak price of ₱130 per kilo during last year’s trading season.

NTA Deputy Administrator Nestor Casela said the decline in prices was influenced by overproduction, which he noted was consistent with the law of supply and demand.

The oversupply this year was attributed to the increasing number of non-contracted tobacco farmers who received support from local governments to expand their tobacco plantations.

Casela added that lower prices were also driven by the proliferation of poor-quality tobacco leaves this season due to limited irrigation water supply and unfavorable weather conditions.

To further protect farmers from income losses, NTA is pushing for greater participation in the tobacco contract growing system (TCGS) program, which provides farmers with a stable market through tobacco companies under agreed terms and conditions.

Under TCGS, farmers also gain access to production inputs, technical assistance, and financial support aimed at improving both the quality and volume of their harvests.

Based on NTA data, only around 10,000 of the country’s 45,000 registered tobacco farmers are enrolled in TCGS. - Dexter Barro II

Related Tags

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