Factors influencing farmers turning into tobacco cultivation in the Khulna division of Bangladesh : an empirical study

Background: Tobacco, along with traditional crops has been cultivating in the Khulna division of Bangladesh for few decades. Despite health and social costs, each year new farmers are also entering into tobacco cultivation though there is skipping trend also. The study attempted to identify factors responsible for turning farmers into tobacco cultivation.

Methods: Primary data was collected from 285 tobacco farmers and 174 traditional crop growers (TCGs) from Khulna division in 2015. Traditional crops included different crops in the tobacco growing season. A number of 157, 160 and 142 farmers were interviewed individually from Kushtia, Chuadanga and Jhenaidah districts respectively. Snowball sampling technique was followed for tobacco farmers whose neighbors were the TCGs. Logistic regression (with marginal effect) was used in quantitative data analysis. Three FGDs and KIIs were also carried out.

Results: Three main issues were responsible for continuing tobacco cultivation which were limitations of traditional crops, prudent role of tobacco processing companies (TPCs), and distinctive features of tobacco itself. Insufficient input support, non-guaranteed sale, and price instability dictated of TCGs to shift towards tobacco. TPCs gripped these and offered tobacco growers counter-incentives like inputs, sales contract etc. Result showed that 76 percent tobacco growers and only 22 percent TCGs received input subsidy. Moreover, 100 percent contractual tobacco farmers enjoyed sales guarantee even before production, where no TCG enjoyed such. Non-contractual tobacco farmers also enjoyed sales-guarantee by selling tobacco to TPCs through contractual farmers. TPCs provided full payment immediately after sale, where 83 percent TCGs sold product in credit, and through middleman. One-time yield and zero in-house consumption supported tobacco’s 98 percent sale. Despite higher production cost, tobacco had higher profit per decimal land. Tobacco farmers were also motivated by neighbors and by land neighbors. Statistically significant variables increasing probability of tobacco production over traditional crops were sales guarantee, price stability, input incentives, profit, sales-production ratio, and land neighbors’ choice of cultivation. Qualitative result showed that poor households and households having family labor had higher tendency to cultivate tobacco than otherwise. Annual average health of tobacco growing households was BDT 4,540 higher than that of TCGs. Social cost and education loss, huge hours of unpaid family labor were also associated with tobacco cultivation.

Conclusions: The main factors behind turning into tobacco grower such as unstable price and volatility in sales guarantee along with insufficient input incentive in the traditional crops should be taken care by the authority.