DOFER Tobacco Fermenting Corp., a member of the Continental Tobacco Group, has increased the basic purchase price of tobacco by 50 percent to compensate for the increase in cost levels in recent years. The move is an important milestone in terms of halting the decline in domestic tobacco production. Its results can already be felt, even before the end of the contracting period, as the contracted areas have increased compared to the total area contracted by the company last year.
Tobacco production in Hungary has faced significant challenges in recent years, which have been reflected in both in the amount of contracted tobacco growing areas and in the results of the harvest and tobacco purchase period. The decline occurred mainly due to increases in energy prices and other costs.
In order to counterbalance this trend, prior to the current contracting period, Continental Tobacco Group’s member, DOFER Tobacco Fermentation Corp., which accounts for around third of the tobacco production in Hungary, increased the basic purchase price of tobacco for 2023 by 50 percent.
The move will provide significant support to domestic tobacco growers, thus indirectly helping the recovery and sustainability of domestic tobacco production. The processing of the tobacco grown in the contracted tobacco areas will be ensured Continental Tobacco Corp. – also belonging to Continental Tobacco Group -, which owns the tobacco factory in Sátoraljaújhely.
According to Continental Tobacco Corp.’s CEO, Csaba Füzi, boosting domestic tobacco production is of critical importance for the entire tobacco industry, since tobacco production, due to its high demand for manual labor, continues to play a decisive role in the employment of the population living in growing areas with unfavorable conditions for cultivation, and in maintaining the population retention capacity of the countryside. By increasing the purchase price, Continental Tobacco Corp. is providing substantial support to tobacco growers and indirectly to the future production of domestic tobacco products.
The tobacco growing process
The tobacco growing season starts at the beginning of the year with the contracting of the growing areas. This is followed by the planting period, typically from March to the end of May, and from June onwards the field work, tobacco plant care, hoeing, crop protection and irrigation begin. Harvesting work is usually completed in September-October, depending on the size of the farms and labour capacity.