July 2020 – The Interstate Tobacco Industry Union (SindiTabaco) attended a public hearing promoted by the Agriculture, Livestock and Supply Committee of the Rio Grande do Sul State Legislative for a debate on the tobacco pricing policy and on the scenario of the sector. Presided over by Elton Weber, it counted on the participation of companies, farmers’ representations and state deputies from the South Region.
SindiTabaco president Iro Schünke took the floor to remind the participants that the SindiTabaco does not take part in matters like tobacco pricing and commercialization. “This is done directly between the companies and the farmers, but I was requested to contextualize the scenario of the sector in Brazil and in the world, and I want to strengthen the importance of a political participation in the protection of this productive sector. The preservation of jobs, income and dividends is in fact the real objective”, the executive officer commented.
According to Schünke, cigarette consumption is gradually dropping, but even so, about 5.3 trillion cigarettes are consumed annually. In the production area, 5 million tons of tobacco are produced in the world, approximately 600 to 650 thousand tons are produced in Brazil. “Production should be adjusted to demand. And always exceling in quality, integrity and product sustainability. Within this context, some companies have already adhered to the Certified Integrated Production System”, he cited.
Schünke presented some numbers of the sector in Brazil, in the State of Rio Grande do Sul. “For the latter, tobacco is even more important, considering that 84% of the volume is shipped abroad through the Port of Rio Grande”, he commented, recalling that the exports have dropped in comparison to the previous year, especially in dollar terms, which hints at a decrease in product quality.
Another topic that affects the tobacco supply chain, contraband was one of the problems mentioned by the executive officer. “The question of the illicit trade impacts seriously upon the Brazilian companies, as the difference between the tax burden on Brazilian and Paraguayan cigarettes affects the competitive balance and encourages contraband, besides contributing towards significant tax evasion, in view of the fact that the consumption of illicit cigarettes outstrips the consumption of legal cigarettes”, Schünke concluded in his participation.
Numbers of the tobacco sector
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