WORLD DEVELOPMENTS

Highlights:

Argentine: Total unmanufactured tobacco production for 1998 is projected at 129,400 metric tons, down from an earlier forecast of 143,500 tons. Much of the decline is with burley tobacco and is blamed on extreme weather conditions due to El Nino. Burley production was originally forecast to reach 32,000 tons in 1998, but is now projected at 25,000 tons. Flue-cured has not been as hard hit as burley. The flue-cured production estimate changed slightly from 88,000 tons to 86,500 tons. Due to lower leaf availability, Argentina’s leaf export forecast for 1998 was lowered by 4,000 tons to 56,000 tons.

Turkey: Area planted to oriental tobacco along with oriental leaf output increased in 1997 due to the relaxation of tobacco quotas by the Government of Turkey. Oriental tobacco production reached 290,000 tons, a 29 percent increase from 1996. Oriental exports totaled 155,000 tons, an 8 percent decrease from a year earlier. Producers, however, are reportedly not alarmed by the decline in exports since foreign demand for oriental tobacco remains strong.

Auction Reports:

Canadian Flue-Cured Auction Update: Through the 78^th sale day of the 1997/98 Canadian flue-cured tobacco marketing season, the Ontario Flue-Cured Tobacco Growers Marketing Board reports that 49,701 metric tons of flue-cured tobacco have been sold. This represents a decrease in sales of 2 percent when compared to the same period of last year's marketing season. Prices in Canadian currency so far this year are averaging $3.80 (US$2.68) per kilogram, down from $4.07 (US$2.97) per kilogram last year. So far this year, sales of "A" graded leaves account for over 79 percent of purchases, up from 77 percent last year.

Exchange Rates:
1996/97 U.S.$ = CA$ 1.37
1997/98 U.S.$ = CA$ 1.42

Last modified: Wednesday, November 26, 2003