Authored by Khan Mehedi Hasan*
Abstract
Several tobacco processing companies patronize tobacco cultivation in Bangladesh. The major objective of the project was to assess farmers’ response against the strategies of tobacco companies in the Jhenaidah district of Bangladesh. Farmers’ perceptions were taken through focused group discussion. Tobacco companies’ activities and strategies were discussed initially. After that, farmers’ reactions on companies’ strategies in both positive and negative directions were analysed in the context of traditional agriculture of the district. Tobacco companies’ sales guarantee at prefixed price motivated farmers to go for contract with tobacco cultivation. Tobacco company provided full revenue at a time which was another point of motivation for tobacco cultivation that was not generally observed in other crops. Though cost of cultivation from tobacco was very high, it provided higher profit in compared with other crops cultivated in the tobacco season. Some crops provided higher profit than tobacco but those were not guaranteed in every season due to high price fluctuation. Companies input support free of cost and at loan but was repaid after harvest attracted many famers into tobacco. In addition to these company supported incentives, farmers considered the option of using family labor, and unique features of tobacco like high cash crop, safe from disease as motivation for cultivating tobacco. Farmers’ negative considerations over tobacco companies were high charge for inputs, subjective grading system of cured tobacco, less address of health safety issues, wide range of hidden and unaccounted cost associated with tobacco cultivation. Non-guaranteed sales and unstable price were main challenges for traditional crops in the district for which tobacco companies’ offers become lucrative to cultivate tobacco. As tobacco is the substitute to the food security of the overburden people of Bangladesh, the research suggests making control over tobacco companies by limiting quota on acres of land to be contracted for tobacco and forcing companies to internalize all health and environmental related costs. Farmers’ awareness need to be created by assessing and publicizing all the unaccounted cost components associated with tobacco farming. At the same time, it is essential to assure sales of general crops at stable price.
Keywords: Contract farmer; Deforestation; Tobacco curing; Tobacco processing company; Sales guarantee
Introduction
Background of the study
Tobacco started to replace general crops in Bangladesh in the mid-sixties of the last century. The process was speeded up by the British American Tobacco (BAT) in Teesta silt in the Rangpur area after liberation in 1971. The study of PROGGA [1] showed that tobacco was grown in 70,000 hectares in the last season of 2013. In that year about 38,000 hectares of additional land was used than the year 2012, 108,000 hectares of land was cultivated for tobacco in 2014. The largest tobacco growing areas of the country include Rangpur, Kustia and Chittagong Hill Truck [2]. In addition to converting new land under tobacco, new farmers are also entering tobacco cultivation in each year, though there is skipping tendency too. The shares of tobacco in GDP value and employment have also increased in several years in recent decades.
Table 1 shows that the growth rate of both area and production was very high for all years from 2002-03 to 2011-2012. Production growth can be explained by HYV, but area growth is clearly alarming and a threat to food security. The share of GDP value of tobacco manufacturing was 5.44 percent in 1996-97 in all manufacturing while it increased to 6.22 percent in 2004-05.
Chart 1 shows that both tobacco production and land under tobacco production were almost stable from 1995 to 2008. After that both showed an upward jump. Land for tobacco was being retained or increased over time where total agricultural land gradually decreased in Bangladesh.
Apart from processed tobacco exports from Bangladesh, domestic tobacco is used as input of bidi, cigarettes, and other semi-processed tobacco products. Many tobacco companies have established semi-processing units near the tobacco growing regions. In the country, bidi manufacturing annual employment amounts to 621,000 labour with 155,000 direct labour and 466,000 indirect labour [3]. Tobacco companies across Asia and Africa get engaged with tobacco farmers for getting assurance about the target amount of tobacco. As a component of the contract, companies provide different inputs and technical support free of cost or at loan. Support normally includes high inputs like seeds, fertilizers, chemicals and other production implements during cultivation and the curing stage. Farmers are contracted to sell a certain amount of tobacco to these companies. In this way companies avoid intermediaries to collect tobacco leaves and thus become able to reduce tobacco procurement costs [4]. Moreover, contract farming allows companies to control tobacco variety, volume, production costs, and creates asymmetric bargaining powers between tobacco firms and farmers [5].
Diverse factors, including region specific factors are liable for spreading tobacco cultivation. Naher and Chowdhury [6] pointed out that family labour, guaranteed sales and ready cash attract farmers to cultivate tobacco. Akhter [7] found that high profit, cash earning, guarantee of inputs and guarantee of sale, play roles in continuing tobacco cultivation. Tobacco companies move in different regions for mining fertile soils. Van Minh et al. [8] showed that in rural Vietnam the average tobacco farmer gets a greater financial benefit from tobacco cultivation than other crops. Furthermore, the myopic view of the farmers about the immediate gain from tobacco cultivation is blamed for expansion of tobacco culture. There is causality between low education level (not completed primary level) of children and tobacco growing of most of the farmers that grow tobacco [9].
It is proved in scientific research that tobacco consumption causes diverse health problems. Globally about 63 percent of all deaths are caused by non-communicable diseases, among which tobacco products are considered one of the major risk factors. Mortality as well as morbidity is increased by tobacco smoking. Both tobacco production and supply are a cause for increased tobacco consumption. Globally, about 600,000 people die from second-hand smoking exposure each year. Among these deaths, the large majority occur in densely populated underdeveloped countries [10]. In Bangladesh, about 58 percent of men and 29 percent of women consume any sort of tobacco, either smoked or smokeless [11]. A significant number of people from Bangladesh are at great risk of use of tobacco products, especially smoking tobacco. Easily availability of tobacco products in Bangladesh is a liable factor which is linked to tobacco production. Over time, tobacco production is increasing in Bangladesh. The [12] identified tobacco-related illness for Bangladesh.
Tobacco cultivation has tremendous social and health bearing which goes often unnoticed. Tobacco farming requires large amounts of wood for a variety of purposes, such as curing, and poles and sticks for barn construction. Tobacco growers cut homestead forests or purchase wood to cure tobacco which creates huge pressure on forest resources [13]. The study of Siddiqui and Rajabu [14] showed that, on average, 4 kg of fuel wood is consumed to obtain 1 kg of cured tobacco. Those who have direct involvement in tobacco cultivation and processing suffer from various health problems. The victims of this health risk include children, pregnant women and older people who participate in tobacco production or live near tobacco-growing fields [15]. Many dimensions of social and environmental costs of tobacco cultivation are grossly unaccounted. For instance, tobacco cultivation puts constraints on other crop farming, adversely affects land fertility and creates external costs on health hazards. Child involvement in tobacco cultivation also leads to increased school drop-out rates.
Many farmers observed a decline in soil fertility for long term tobacco cultivation in the same land which caused lower yield in other crops too. After adding the opportunity cost of family labour, Van Minh H [8] found very minimal profit for one region and negative for another region in Vietnam. There exists some anti-social movement in some regions in Bangladesh where some regions also showed growing interest for tobacco. Sometime farmers partially shifted from tobacco production due to government initiatives to get farmers back into food crop production. Some farmers stopped cultivation completely. At the same time many remained in cultivation but reduced the amount of land for tobacco cultivation. Some farmers continued and some also entered tobacco cultivation. Though Bangladesh is an agrarian economy, it is characterized with many limitations. In that case, farmers try to find crops which have less challenge in the input and output market. It is urgent to examine the reasons why conventional agriculture (mostly crop agriculture) fails to arrest the increased adoption of tobacco culture. As tobacco is a socially undesirable product, there is a need to discourage farmers. In order to prescribe some policies, it is essential to identify the dynamics among traditional crops, tobacco companies and tobacco farmers. Unless tobacco production is reduced, it would be hard to reduce food insecurity and public health risk. Withdrawing poor farmers from tobacco cultivation is not an easy task. In order to minimize tobacco cultivation, the first step would be exploring the tobacco firm-farm linkage. Along with exploring the strategies of tobacco companies, it is equally essential to identify factors that influence farmers to adopt, continue or to quit tobacco in the context of traditional agriculture. It will help to understand how tobacco companies are defining strategies to encourage tobacco cultivation. This research will contribute to policymaking as it is blamed that there is no direct policy to regulate tobacco cultivation in Bangladesh [1]. This research output will give a clear direction for designing a participatory tobacco control policy in Bangladesh.
Objectives of the research
The research firstly aimed to explore strategies of tobacco companies that support tobacco cultivation. Main research questions were to explore how do tobacco companies implement their strategies and what package they offer to farmers. Second objective of the research was to identify farmers’ responses to tobacco companies’ strategies. In this case, research questions were to know why some farmers decide to be contracted with tobacco companies and what benefit and cost do they consider. This research question helps in understanding the role of various supports from tobacco companies to arrest the expansion and adoption of tobacco cultivation by farming households. At the same time, it will help to stereotype farmers who want to be engaged in tobacco cultivation and to what extent. And third objective was to explore the context of traditional agriculture and compare those in the context of tobacco and tobacco companies. Research questions posed in this research was to explore why some farmers prefer tobacco cultivation over traditional crop agriculture while others do not do so. This research question helps to understand the strengths and challenges of tobacco over tradition crop cultivation.
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