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Tobacco production decreases in the world

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Tobacco production will generally maintain a downward trend, according to the US company Universal Corporation, one of the leaders in the industry.

Although air-cured tobacco crops grown outside of China increased in fiscal year 2022 by about 4%, to 1.7 billion kilograms compared to fiscal year 2021, production levels remain below historical averages.

Additionally, these crops are forecast to return to lower production levels, declining by around 4%, to 1.7 billion kilos in fiscal year 2023.

Also, the world production of burley tobacco remains below historical levels and fell by approximately 10%, to about 398 million kilos in fiscal year 2022.

Universal Corporation said burley volumes are forecast to increase slightly to around 404 million kilos in fiscal 2023.

Estimates that as of March 31, 2022, the industry’s uncommitted burley and hot air cure inventories, excluding China, were at historically low levels, totaling approximately 62 million kilos, a decrease of about 34%. from the levels of March 31, 2021.

Tobacco production

At this time, Universal Corporation believes that both the supply of air-cured tobacco and burley tobacco are in positions of undersupply.

The company also forecasts that the production of oriental and dark air-cured tobacco will decrease by around 21% and increase by around 4%, respectively, in fiscal year 2023.

Both oriental tobaccos and dark air-cured tobaccos are in positions of short supply.

In the long term, the company believes that global tobacco production will continue to grow in line with slightly declining total demand. South America, Asia, Africa and North America will continue to be key sourcing regions for air-cured and burley tobaccos.

China is an important market for cigarettes. However, most of the cigarettes consumed in China and the leaf tobacco used in those cigarettes are produced in the country.

Therefore, the company typically views the Chinese market independently when assessing global supply and demand for leaf tobacco.

Domestic inventories of leaf tobacco have built up in China in recent years as China’s domestic production of tobacco leaves has exceeded its domestic needs for the local cigarette market.

China continues to demonstrate efforts to realign its domestic sheet production and inventories to balance its needs, and inventories have started to decline. These efforts could influence global supply/demand in the short term.

Universal Corporation is a global business-to-business supplier of agricultural products to consumer product manufacturers, operating in more than 30 countries on five continents, sourcing and processing tobacco leaves and plant-based ingredients.

 

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