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Tobacco auctions open across Georgia
Amid drought, deadly disease and a new way of selling one of Georgia's top money-making crops, tobacco auctions opened across Georgia this week.

Georgia's tobacco auctions started in Statesboro, Ga., July 30. Opening prices for this region were $1.56 to $1.78 per pound.

"Prices look good," said J. Michael Moore, an agronomist with the University of Georgia College of Agricultural and Environmental Sciences. An auction opened in Douglas July 31. Smaller auctions will be in Moultrie and Nashville.

Contracted

But much of the Georgia tobacco crop will not go to auction this year. About 92 percent of the 2002 crop was contracted before April 15. Contract farmers bypass the process and sell directly to tobacco companies, Moore said.

Because of this, the number of auction sites across Georgia has dwindled over the past few years. "There are not going to be new (auction) warehouses opening up," he said.

Anybody who wants to know when and where tobacco auctions will take place, plus other Georgia tobacco information, can go to www.georgiatobacco.com.

Though auctions will continue to be a way to sell tobacco, they’re becoming less popular.

"Growers for the second year in a row have chosen overwhelmingly to sign contracts as a means of marketing their crop," Moore said.

Farmers who contract see the advantage of delivering their tobacco and returning home with a check that same day, he said.

There are 10 receiving stations in Georgia and Florida where farmers can deliver directly to the tobacco company.

"There's an efficiency to the operation in dealing directly with the individual that purchases the tobacco," he said.

But growers who choose to go to auction have an opportunity to compete for the highest bid among all the companies.

Choked Supply

And this year, prices could be high for noncontracted quality Georgia tobacco.

(Tobacco companies already competed heavily to gain contracts with Georgia and Florida growers. Tobacco in this region, because of its higher sugar content, is highly sought after. Only 80 percent of the tobacco from other tobacco-growing states were contracted, compared with the 92 percent in Georgia and Florida.)

A growing season scarred by deadly diseases, though, has choked the supply of Georgia tobacco. The tomato spotted wilt virus has killed about 35 percent of the tobacco crop. That will cause about a 20 percent reduction in the overall production for Georgia. And that's a conservative estimate, Moore said.

Farmers have battled this disease, which also affects tomatoes, peanuts and other vegetable crops, since 1986. But this year "was the worst in history," he said. Georgia farmers are allowed, due to government regulation, to grow around 60 million pounds of tobacco. A 20-percent reduction of that is 12 million pounds. That calculates, conservatively, into $21.6 million in tobacco that won't be sold this year.

Disaster?

The Georgia Department of Agriculture is pushing for disaster assistance for tobacco farmers devastated by disease and drought this year.

"Growers have been hurting financially, spending extra money to produce this crop," Moore said. "And then they're going to come up short on tobacco to sell."

Will the shortage of quality Georgia tobacco have an effect on the demand this year?

"The only place to find that out is where there is some competition," he said, "and that's at the auction sites."

Moore said it's tough to say how much tobacco will be harvested this year. There could have been as many as 27,000 acres.

"But we've had close to 1,000 acres already destroyed and insurance collected on it because of the tomato spotted wilt virus," he said.

Georgia averages about 2,000 pounds of tobacco per acre. But this year, Moore said, the average will be more like 1,800 pounds per acre.

Many frustrated farmers feel an urgency to get through with this year's crop, he said. Moore tells farmers, "Don't get into a hurry. The best tobacco is yet to be harvested or cured."

(Brad Haire is the former news editor with the University of Georgia College of Agricultural and Environmental Sciences.)

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