Mighty Corp doubles their tobacco orders

Mighty Corp., one of the country’s local producers of low-priced cigarettes, announced it will buy 10 million kilograms of tobacco products worth millions of pesos from farmers in Northern Luzon and elsewhere in the country.

Mighty executive vice president Oscar Barrientos said in an official letter of intent to National Tobacco Administration administrator Edgardo Zaragoza it would buy tobacco from farmers 100 percent more than the five million kilograms his firm bought in 2013.

“This is to assure our tobacco farmers of our willingness to help in response to the published report of the market leader in the tobacco industry to lessen production this year,” Barrientos, a retired regional trial court judge, said.

The letter of intent, in effect, debunked critics’ allegations that MC has been importing raw materials from foreign countries at low prices and is no longer buying tobacco from local farmers.

Barrientos said the critics had been resorting to a disinformation campaign using convoluted data in an effort to undermine Mighty’s tremendous increase of its market shares.

MC’s market shares surged to almost 20 percent of the low-priced cigarette brands last year from in 2012, resulting in the payment P8.2 billion in excise taxes.

Barrientos said the company’s market shares shot up after the government effectively implemented Republic Act 10352, or the Sin Tax Law, that leveled the playing field in the multibillion-peso tobacco industry which was controlled by Philip Morris and Fortune Tobacco.

The new law that took 14 years to pass and certified as urgent by President Aquino III caused a tremendous migration of smokers from the expensive premium and sub-premium brands to low-priced cigarettes.

It also resulted in some smokers, because of economic reason, to simply quit the vice and thus validated health authorities’ estimate that the sin tax law would result in the decrease of the number of smokers in the country.