Will more growers exit tobacco before the next crop?
Jan 12, 2007 3:12 PM,
By Chris Bickers
Freelance Writer
There is no mystery as to what it will take to bring more acres into tobacco in 2007, says the president of the Tobacco Growers Association of North Carolina.
“Price is the overwhelming factor,” says David Hinnant of Kenly, N.C. “Price and price alone will determine for each individual farmer whether to exit or continue.”
Hinnant spoke at the Tobacco Day program held at the Jane S. McKimmon Center in Raleigh, N.C., and said there was reason for both optimism and pessimism as the 2007 season approaches.
Right now, he thinks more farmers are going to exit before seeding begins.
“There could be as few as 3,000 flue-cured growers in North Carolina this year,” he says. “Those remaining in flue-cured will have the opportunity to increase acreage, maybe by 25 percent.”
On an encouraging note, Hinnant says he has learned one purchaser has been making offers that reflect an increase over last year.
One development that could affect the market over time is the mergers of the leaf dealers Dimon and Standard Commercial, forming Alliance One, and of manufacturers RJ Reynolds and Brown & Williamson, forming Reynolds American. Four buyers have been reduced to two, says Hinnant, and that will surely affect price competition.
In other comments, Hinnant noted:
• North Carolina, including Wilson County where he farms, was impacted this season by two major tropical storms. The first occurred in June, the earliest ever. “On my farm, I had to restand some fields three or four times,” he says.
He was able to use a combine to harvest as planned, but some of his neighbors had to forego mechanical harvest in favor of priming by hand because of the bad condition of the stalks.
For the area affected, there was an estimated 25 percent loss in plantings, he says.
• There would be some benefit for farmers if they could enter long-term contracts. “Growers are reluctant to expend large amounts of capital” with no more assurance than they have now, Hinnant says.
He sees a problem on the horizon: The retrofit heat exchangers that were installed in most barns at the beginning of the decade will need replacement soon. Will farmers be willing to go to that expense unless they get a longer-term commitment?
The questionable situation affects the mind set of farmers at meetings like Tobacco Day. “No one talks about cultural practices, just policy and litigation,” Hinnant says.
If production continues to increase, varietal resistance may become more important in disease control.
“As we expand our planted acreage, we will have less land to rotate,” says Marion D. Hawkins, Jr., president of GoldLeaf Seed Co. of Hartsville S.C. “There will be more pressure on resistance as there is less rotation.”
Hawkins was named a “Tobacco Great” by the North Carolina State University agricultural faculty at Tobacco Day. Also named was C. Dwight Howard of Carolina Greenhouses in Kinston N.C.
In an interview with Southeast Farm Press, Hawkins said the major challenge for plant breeders right now is to incorporate resistance to Race One black shank into varieties.
“We have resistance for Race 0 black shank covered, but Race One we have to work on,” he says. “I believe we will find resistance.”
Another direction coming up in breeding will be providing growers with varieties with a full range of maturities, Hawkins says “Maturity is going to be important because farmers will have to get their tobacco through their barns efficiently.”
If varieties of different maturities can help a farmer schedule the flow of leaf through his curing barns, curing could be made more cost effective.
Hawkins seems discouraged about only one aspect of tobacco breeding now — the failure to find a source of resistance to tomato spotted wilt virus.
“I see no answer at the present time to the challenge of coming up with resistance to tomato spotted wilt virus,” he says. “But we are looking.”
On the same day that the North Carolina Tobacco Day event took place, the National Agricultural Statistics Service issued its December crop production report.
The forecast for production of all types of tobacco was 734 million pounds. That is 13 percent above 2005, the first year without a price support program, but 17 percent below 2004, the last year tobacco was under the quota system.
Area for harvest was forecast at 334,300 acres, up 12 percent from last year. Tobacco yields for 2006 are expected to average 2,194 pounds per acre, 23 pounds greater than the previous year.
Flue-cured production is expected to total 454 million pounds, 19 percent above 2005, the NASS said in an earlier report. Burley production is expected to total 217 million pounds, 7 percent above last year.
In North Carolina, production of flue-cured is projected at 330 million pounds, up 20 percent from 2005, while production of burley in the state is projected at 7.6 million pounds, up 53 percent from 2005.
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