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World
Unmanufactured Tobacco Production, Supply and Distribution
Production
Nearly three-fourths of the
world’s leaf tobacco production is grown in China, the United States, India,
Brazil, Indonesia, and Greece. For
2002, global leaf output is forecast to fall marginally as a result of a
downturn in cigarette use in much of the developed world.
China is by far the
world’s leading leaf producing nation accounting for one-third of the world=s
leaf crop. In recent years, China
has become more focused on improving leaf quality and lowering domestic stock
levels. China’s revised marketing
policies pushed procurement prices lower for poorer quality tobaccos by 47
percent in 2002, while prices for higher quality leaf are expected to fall only
marginally. China’s leaf output
is further controlled by the local governments’ strictly enforcement of leaf
quotas. Leaf production fell by
nearly 8 percent in 2001, and is forecast to fall another one percent in 2002.
India, the world’s second
leading producer of leaf tobacco behind China, is forecast to grow nearly
635,500 metric tons of tobacco in 2002, up over 8 percent from last year.
Much of this increase is due to the ending of the crop holiday in Anhra
Pradesh, India’s main flue-cured growing province.
Flue-cured tobacco accounts for about 25 percent of India’s leaf crop,
is expected to reach 155,000 tons, a nearly three-fold increase from the
previous year. Much of the
remaining leaf grown in India is dark air-cured and sun-cured type tobaccos.
U.S. leaf production is
showing signs of stabilizing after declining considerably over the last few
years. In 2001, U.S. leaf output
was up marginally due to favorable weather conditions in many of the growing
areas, and due to a slight increase in the effective quota for flue-cured
tobacco. For 2002, total leaf
production is forecast at 418,430 metric tons, down from 449,745 tons in 2001.
Production of flue-cured and burley tobacco, which combined account for
96 percent of the U.S. leaf output, is forecast to reach 246,300 and 156,035
tons, respectively.
Leaf production in the
European Union is expected to decline slightly in 2002.
The EU=s
major producers, Italy, Greece, and Spain, are expected to meet their respective
tobacco production quotas. French
leaf output is projected to decrease 2 percent, while production in Germany is
forecast to increase nearly 3 percent.
Consumption
The world=s
leading leaf consuming nations are China, the United States, India, Russia,
Germany, and Japan. Domestic
consumption is representative of the level of tobacco product manufacturing
(particularly cigarettes) in a given country.
China’s leaf consumption in 2002 is forecast to reach 2.63
India=s
domestic leaf consumption is expected to reach 476,130 tons in 2002, up slightly
from the previous year. Last year
was a difficult year for the Indian tobacco industry because of the crop
restriction in the main flue-cured province of Anhra Pradesh.
India=s
cigarette sales both domestically and abroad dropped in 2001.
However, leaf use is expected to increase this year on account of more
leaf being available and a 16-percent increase in cigarette exports.
Japan’s leaf consumption
is projected to drop this year due to a growing anti-smoking movement. Leaf use
in 2002 is forecast to total 60,500 tons, down 4 percent from the previous year.
Leaf consumption in 2001 fell by nearly 11 percent from 2000.
Turkey’s leaf consumption
is project up almost 4 percent this year. For
2002, the consumption of flue-cured and burley tobaccos is expected to increase
8 percent and 5 percent, respectively, while the consumption of oriental leaf is
forecast to remain constant. Consumer
demand is shifting from an oriental type cigarette to blended brands.
Exports
While several of the
world’s top leaf exporting nations are likely to show gains in 2002, global
leaf exports are forecast to fall on account of a lower leaf production in many
areas and a stagnant global demand for tobacco products.
The world=s
leading exporting nations are Brazil, the United States, Zimbabwe, China, and
India.
U.S. leaf exports were up 3
percent in 2001 due in part to greater production levels, particularly
flue-cured tobacco. Much of the
increase in leaf shipments was to the European Union, particularly Germany and
Belgium/Luxembourg. Exports to the
EU rose nearly 12 percent in 2001 and reached 98,000 tons.
For 2002, leaf exports are again expected to show a slight increase.
However, competitive world leaf prices, aggressive global anti-smoking
campaigns, and ample global leaf stocks continue to dampen U.S. leaf sales
abroad.
Zimbabwe is the third
largest world leaf exporter, but continues to experience economic hardship and
uncertainty over land ownership. Sources
expect that global leaf companies will begin sourcing more tobacco from Brazil
to compensate for the declining output trend seen in Zimbabwe.
Brazilian leaf exports in 2001 reached 354,900 tons, up nearly 4 percent
from 2000, despite a 4-percent reduction in leaf output.
China has become one of the
world’s top leaf exporters with flue-cured accounting for about 96 percent of
this trade. In recent years China
has begun to aggressively develop export markets as a way to keep
Imports
The Russian Federation,
Germany, the United States, the United Kingdom, Japan and the Netherlands are
the world=s
leading unmanufactured tobacco importing nations.
World imports are forecast to show a slight gain in 2002 as several
importing nations rebuild stocks that have been drown down over the last several
years.
The Russian tobacco industry
depends heavily on imported leaf. Russia’s
leaf imports are forecast to total 307,500 tons, unchanged from 2001.
More than half of Russia’s leaf imports are sourced from China, Brazil,
India, Kyrgyzstan, the U.S. and Moldova. Despite
the small domestic crop, the high level of leaf imports has enabled the Russian
cigarette industry to grow over the last 5 years.
This has kept foreign brands from capturing a larger share of the
domestic market.
Germany’s leaf imports in
2002 are forecast to reach 257,000 tons, compared to 247,066 tons last year.
Imports from the U.S. are forecast to decrease in 2002 as importers look
for more competitively priced leaf. Increased
purchases from Brazil will likely compensate for lower purchases of U.S.
flue-cured. Other non-EU suppliers
to the German market include Malawi, Turkey and Indonesia.
U.S. leaf imports (general
imports) reached 254,366 tons in 2001, up nearly 29 percent from the previous
year. Flue-cured, burley, and
oriental tobacco combined account for nearly 70 percent of U.S. leaf imports.
In 2001, imports of flue-cured tobacco totaled 55,211 tons, and valued
$175.6 million, while burley imports reached 57,572 tons valued at $174.7
million. Imports of oriental
tobacco reached 62,778 tons in 2001, and valued $253.2 million.
When combined, oriental, flue-cured and burley tobaccos are the principle
leaf types used in the American-blend cigarette.
For 2002, U.S. general leaf imports are forecast to reach nearly 270,000
tons.
Japan is becoming more
dependent on foreign leaf as domestic production declines.
Leaf imports for 2002 are estimated at 91,000 tons, down almost 2
percent. For 2002, imports from the
United States are expected to drop slightly, although the U.S. accounts for
nearly 41 percent of the Japanese leaf import market.
Other suppliers include Brazil, Zimbabwe, Malawi, the EU, and China.
Stocks
World unmanufactured tobacco
stocks are projected to decline over 25 percent in 2002.
Much of this fall can be attributed to lower output by many of the
world’s top leaf producers in an effort to bring stocks more in line with
demand. A majority of the world’s
leaf stocks are held in China, the United States, Turkey, Brazil and Japan.
China accounts for nearly 34 percent of the world’s leaf stocks and is
expected to lower levels by nearly 32 percent in 2002.
Turkey’s leaf stocks are forecast to be lower in 2002 as a combination
of production controls, exports and stock disposal policies have had some
affect. Japanese stocks have been
trending lower on account of declining production and import levels. Stocks in the United States have declined over the last few
years on account of lower production levels and efforts by the industry to bring
supplies more in line with demand.
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