Price crash: Tobacco Board to meet in Mysuru on Monday

The Tobacco Board is holding a meeting with the elected representatives of tobacco growing regions of Karnataka and the tobacco traders in Mysuru on Monday (March 2, 2026) to discuss the situation arising out of the recent crash in tobacco prices.

MPs representing Mysuru and Kodagu, Chamarajanagar, Hassan and Mandya Lok Sabha constituencies, besides MLAs representing Periyapatna, Hunsur, H. D. Kote, K. R. Nagar and Arkalgud have been invited for the meeting, which will also be attended by Tobacco Board Chairman Yashwanth Kumar Chidipothu, Board’s Executive Director B. Vishwasree and Board’s Director (Auctions) B. C. Srinivas.

All the major cigarette manufacturers and exporters, including ITC, are expected to attend the meeting held in the wake of the concern gripping the tobacco farmers of the region following a collapse in the prices of tobacco after the Centre recently hiked GST from 28% to 40%.

It may be mentioned here that the tobacco farmers resorted to an agitation after the prices of superior grade tobacco, which was fetching them around ₹ 320 per kg, crashed to ₹ 270-280 per kg in the weeks following the Union Budget.

The collapse in prices was attributed to decline in the procurement by the cigarette manufacturers, traders and exporters. 

The sharp fall in tobacco prices sparked protests by farmers in Hunsur and Periyapatna, two key tobacco growing regions in the state, leading to suspension in auctions in many platforms in the state last week.

While Mysuru MP Yaduveer Krishnadatta Chamaraja Wadiyar said the MPs of the tobacco-growing regions in Karnataka and neighbouring Andhra Pradesh had urged Union Finance Minister Nirmala Sitharaman to review the hike in GST from 28% to 40%, Minister for Animal Husbandry and Sericulture K Venkatesh, who also represents tobacco growing areas of Periyapatna in the Legislative Assembly, came down heavily on the tobacco traders for scaling down their procurement after giving a higher estimate at the time of submission of an indent to the Tobacco Board.

The Tobacco Board fixes a crop size based on the indent submitted by the trade.

The collapse in prices mid-way through the auction season – with about 40 million tonnes out of the total 85 million tonnes remaining unsold – farmers are worried about its economic impact on their lives.

Auctions have resumed across most platforms in the state and the price for the superior grade of tobacco has crossed ₹ 300 per kg. The farmers are hoping that the prices increase to reach the prices prevailing before the collapse.