Growers are facing a 10 percent cut in production this year and have seen exports decline to about half of what they were 10 years ago. Farmers believe a buyout is the best plan for their survival.
The current tobacco program puts U.S.-grown leaf at a price disadvantage because of the high costs associated with quota. The cost of U.S. flue-cured exports averages more than double the average cost of foreign exports.
Jerry Jenkins, a Virginia tobacco farmer who’s chairman of Tobacco Associates, says the "deck is stacked against tobacco."
In Washington, D.C., however, Etheridge, who’s the only tobacco farmer in Congress, sees positive developments toward a buyout.
Senate Majority Leader Bill Frist, Majority Whip Mitch McConnell and House Agriculture Chairman Bob Goodlatte are all from tobacco producing states. Efforts are also under way to reach a compromise with Sen. Edward Kennedy (D-Mass.) on giving the Food and Drug Administration authority to regulate cigarettes. Etheridge and Rep. Ernie Fletcher (R-Ky.) have sponsored buyout legislation, with a few changes.
Quota holders would get $8 per pound and farmers would receive $4 per pound. The bill would also set a minimum price support to protect growers.
Both Etheridge and North Carolina Agriculture Commissioner Meg Scott Phipps emphasized that public fighting over the details or who takes credit for the plan could doom its passage.