Yunnan and Guizhou are important agricultural areas and the biggest tobacco producing provinces in China and represent about 30% of worldwide Flue-Cured production.
Working with our suppliers, PMI is part of a large transformational project to drive farmers towards sustainable fuel usage. This is done with the support of local governments, and under the leadership of CNTC (China National Tobacco Corporation).The project consists in converting tobacco curing barns from coal to biomass and creating a fuel-pellets supply chain produced from agricultural waste (tobacco stalks, mulberry branches, used tent poles).
Tobacco farmers’ cooperatives funded new pellet production facilities, which fosters the circular bioeconomy and benefits farmers, local schools and factories, while generating positive environmental and social impact. Biomass adoption and largescale barn conversion (more than 50,000 in 2019) have triggered technological innovation in the tobacco production model contributing to reducing the dependency on fossil fuel and supporting PMI’s GHG emission reduction strategy.
Philip Morris International (PMI) is leading a transformation in the tobacco industry to create a smoke-free future and ultimately replace cigarettes with smoke-free products to the benefit of adults who would otherwise continue to smoke, society, the company, and its shareholders. For PMI, sustainability means creating long-term value for our shareholders and for society, while minimizing the negative externalities associated with our production, operations, and value chain. We are committed to sourcing wood-based materials from traceable, sustainable and legal sources for tobacco curing, while protecting the right and livelihoods of local communities.
The prevailing curing fuel being used by tobacco farmers in PMI sourcing provinces of Yunnan and Guizhou is coal, because of its lower price and availability. The volume of tobacco cured with coal leads to high impacts on air pollution and other environmental factors.
Although biomass has been known as a popular sustainable fuel used widely in other industries and available in other provinces, the transportation costs and high-volume requirements have impeded its large-scale adoption in the tobacco sector.
The initiative includes creating a local supply chain and a profitable business model for biomass production, using pellets as alternative and sustainable curing fuel. This requires important investments into the conversion of barns (from coal to biomass) and for the set-up of biomass production centers (including sourcing of raw materials). This initiative fosters circular bioeconomy, involving farmers (source of raw materials and end users of pellets), and other stakeholders. The commitment from CNTC and local governments, as well as the full endorsement by our suppliers were key success factors.
PMI laid the foundations for this multi-stakeholder initiative that has, to-date, successfully achieved to convert more than 70,000 curing barns in both provinces, leading to a significant reduction on GHG emissions from tobacco curing (from 2.86 to 1.86 kg/kg cured tobacco) by the end of 2020. To measure this, PMI developed a Monitoring Framework for Sustainable Curing Fuels (MVR) covering the quantification of fuel needs vs. availability, and ensuring sustainability, transparency and replicability, as well as stakeholders’ engagement. Data collected from the pilot areas has shown that the commercial tobacco grades were improved by 8.63%-11.77% for the sampled farmers when compared to the of use of biomass and coal for curing. This has contributed to increasing farmers’ income.
Pellet production facilities funded by tobacco farmers’ cooperatives are contributing resources to the local communities, with no measured negative externalities on factories and shops in charge of building new equipment. The biomass pellet auto feeder attached to the burner has reduced labor-hours for fuel loading and is lowering the cost of production. Local schools and other factories also benefit from the use of pellets for their energy needs. This large scale transition has contributed to reducing the dependency on fossil fuel and support PMI’s GHG emission reduction strategy.
Further expansion of biomass curing, and its supporting local supply chain development will continue in both provinces under the leadership of CNTC and support from local government and tobacco communities. PMI will continue to work with leaf suppliers and local partners closely to support on the ongoing transition.