Lebanon Businessnews News

Régie will open packing
factory in Ghazieh
To enhance quality and fasten export process
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The Régie, the State-owned tobacco monopoly, will open a factory for packing tobacco in Ghazieh, in November.

The facility will have capacity to pack 50 tons of tobacco in cartons, instead of burlap sacks per day. Abdel Mawla Almawla, Régie Leaf Department Manager, said: “The new facility will help us sort and pack tobacco for the export markets, faster than our current speed. It will also contribute to enhancing its quality.” Sorting and packing tobacco used to take the Regie around one year, but the facility will enable it to pack it within five months.

Investment in the project is $4 million. It will have a built-up area of 1,000 square meters.

The Régie is now purchasing tobacco harvests from farmers. Prices are LL5,050 per kilogram for low quality tobacco, LL13,100 for medium quality, and LL18,450 for high quality. Almawla said that good quality tobacco accounts for 30 percent of the total, medium quality for 50 percent, and low quality for 20 percent.

The total production of tobacco is 8,000 tons per year. Southern farmers produce 5,500 tons, Bekaa farmers 1,800 tons, and Northern farmers 1,600 tons, 1,550 tons of which are produced for Narguileh pipe tobacco.

Around 5,000 tons of tobacco is exported to four major international companies, Philip Morris, British American Tobacco (BAT), Imperial Tobacco, and Japan Tobacco. Almawla said that a small percentage of the local production is used in the Cedars brand, as the Lebanese prefer the American blend.

Southern tobacco is sold abroad for $6 per kilogram after filtering and packing. Bekaa tobacco sells for $3 per kilogram, and Northern tobacco for $1 per kilogram. According to Almawla, subsidies to farmers are estimated at around $48 million each year.
Reported by Rania Ghanem
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Date Posted: Oct 29, 2015