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Mighty competition in Tobacco North

Rosales, Pangasinan — More farmers in Pangasinan, Ilocos provinces, and the Cagayan Valley region are seen to increase their incomes as Mighty Corporation assured them that as a new major player in the tobacco industry will be buying more tobacco leaves in 2014.

“It is high time true competition can now happen in the tobacco industry with prices being dictated in the past by a monopoly imposed by the merger of the two giants in domestic cigarette manufacturing,” said Ernesto Calindas, president of the National Federation of Tobacco Growers and Cooperatives Inc.

The statement was made by Calindas after Mighty Corporation Executive Vice President Oscar P. Barrientos said that the Filipino-owned cigarette manufacturer will buy more tobacco leaves in 2014 from farmers in Regions 1 and 2.

Looking back to the previous year, the local tobacco industry had only one outlet for Virginia and burley tobacco leaves used for cigarette manufacturing, and another buyer for export-quality leaves.

“Under those circumstances, we had to sell dried tobacco at prices the buyers offered without any other option to sell to a serious competitor,” explained Calindas, adding that Mighty Corporation has been the anchor of tobacco farmers in the sale of their low-grade tobacco leaves.

The prices were fixed at a range of P45 a kilo for the low-end leaves to P80 for top quality leaves,” he recalled.

“This time we have greater assurance and more reasonable pricing will be now expected with Mighty Corporation’s announcement that it will buy more tobacco leaves in 2014,” Calindas said.

Mighty Corporation hogged the limelight recently when established competitors sought a congressional investigation over its sudden rise as a tobacco player, eating up the markets of previously low-priced cigarettes with brands identified with Philippine Morris Fortune Tobacco Corporation (PMFTC).

From a minimal five percent share of the domestic market, Mighty Corporation cigarettes zoomed to corner 20 percent in less than a year since the new tobacco sin tax took into effect in 2013.

Company officials asserted that reasonably priced quality products, smartly packaged and creatively sold were behind the all-Filipino company’s success.

  • Felix Cortado

    After the allegations and accusations against Mighty, they still choose to divert the issue rather than facing it. I hope the government isn’t buying this BS.

  • schmuckthat

    So Mighty answers back by purchasing tobacco leaves locally when they can’t dispute allegations that they have been undervaluing imported raw materials?

  • Carlos Quidlat

    The competition should result in better living for tobacco farmers especially in the North. But a mere announcement of buying from them will never make a dent obviously. Government should compel companies to source a certain percent of their raw materials from them.

  • JerryDJesus

    Mighty was importing tobacco leaves @ .$68/ kilo for several years. They have already deprived the government of proper taxes and earnings for Filipino farmers. Why the sudden shift to local tobacco? Is it because they want to hide that they have under-declared the actual value of their tobacco leaves in order to avoid paying taxes? They suddenly want the support of our farmers because they are now being investigated by the congress because of possible tax evasion.

  • Jun Mabini

    Local farmers must push government to create a law that will require companies to source a certain percentage of their raw materials from the local market. Otherwise, companies whose main way of profiting is by cheating government will continue to do so.