Universal Leaf steps up buying

MANILA, Philippines - The Universal Leaf Philippines, Inc. (ULPI) has opened its tobacco buying stations in Candon, Ilocos Sur and Agoo, La Union where its warehouses are located.

ULPI, the biggest tobacco growing and processing company in the country, works with more than 28,000 farmer contract growers covering an area of more than 19,000 hectares.

These contract growers account for about 57 percent of the country’s local leaf.

 ULPI president Winston Uy sounded bullish about this year’s business performance arising from stable supply of good quality tobacco.

“We are very optimistic because of the good quality of tobacco we are receiving from our hard-working farmer partners. At the start of every crop year, we provide them full financial and technical support. I believe that supporting our farmers 100 percent redounds to sustainability.”

“We also recognize that it is just as important to extend subsidy for their other needs during the tobacco planting season,” Uy added.

ULPI provides P1 billion financing support to all its contracted farmers. This financial support allows the farmers to produce quality leaf. The company also assures market and profitability.

Dismissing claims that tobacco farming is a sunset industry, records of production from the National Tobacco Administration (NTA) showed that from a record low of 36.50 million kilos in 2006, local tobacco production increased steadily at a yearly average 17.5 percent to an all-time high of 79.33 million kilos in 2011.

The NTA attributed the sustained growth of the tobacco farming industry to the strong support extended by the industry players to the farmers.

Tobacco farmer Arnel Salagubang from Pangasinan looks forward to a better income this year. Salagubang has been planting tobacco for 24 years now. From less than a hectare of land when he started planting tobacco, Salagubang now cultivates 2.5 hectares of farmland.

 In an interview, Salagubang said he is now able to sufficiently support his family.

He also cited the NTA regulation setting floor prices for tobacco, saying the system assures farmers like him of a profitable livelihood.

However, actual buying prices for tobacco are way above the floor prices set by the government. For virginia tobacco, for instance, the average actual buying price increased by 26 percent to P74 per kilo in 2009from previous year’s P59.32, because of supply shortage in the world market.

When the supply normalized, the actual buying prices for Virginia leaf were maintained at its high level of P68.56 and P70.42 per kilo for 2010 and 2011, respectively.