By Brad Haire
University of Georgia
Each year, the U.S. government calculates the U.S. tobacco quota, the amount farmers can grow and get government price support for.
LessGeorgia growers will be allowed to grow about 54 million pounds of flue-cured tobacco in 2004. That's around 16 percent less than in 2003, said J. Michael Moore, a tobacco agronomist with the University of Georgia Extension Service.
"This means Georgia tobacco growers will be spending less for chemicals (and) equipment and possibly holding off on any improvements to their farms," Moore said. "This will further negatively affect the rural economies that surround tobacco production in Georgia."
Farmers grow flue-cured tobacco in five states. Depending on the amount a state was able to harvest the previous year, the actual quota cut for a state could be more or less than the overall U.S. cut.
Because of heavy rain, Georgia farmers harvested less tobacco than the government said they could in 2003. Despite this, they were still able to harvest more than they did in 2002, when the crop was devastated by disease.
The national tobacco quota will be 471.3 million pounds in 2004, about 55 million, or 10.4 percent, less than 2003. The U.S. quota is now less than 50 percent of its 1998 level.
U.S. tobacco companies plan to buy 254.3 million pounds of tobacco in 2004. That's about 10 percent less than they planned to buy in 2003.
Cigarette makers are required to report each year to the U.S. Department of Agriculture how much flue-cured tobacco they intend to buy from U.S. growers.
The USDA includes the companies' buying intentions in the quota formula. They also consider the U.S. export average over the previous three years and the reserve supply of the Flue-Cured Tobacco Cooperative, the farmer-owned co-op that runs the federal program.
The 2004 tobacco quota cut is drastic. But it could have been much worse. Last week, the co-op sold about 45 million pounds of tobacco. This reduced the stockpile. Without this last-minute sale, the quota cut was expected to be 22 percent.
BuyoutTobacco farmers have asked Congress to buy back their quota and end the federal tobacco price-support program. They feel the program has become obsolete and hurts them on the world market. It was established in 1938.
But a buyout will be a hard sell in Washington, members of Georgia's legislative delegation told about 400 Georgia farmers Dec. 15 at the UGA Rural Development Center in Tifton, Ga.
Tobacco-state lawmakers are outnumbered 10-to-1. Several buyout bills have been dropped or have become stagnated in Washington.
Settlement checkBut some help is on the way, Moore said. Georgia growers can expect to get their annual phase II check around the first of the year. They'll get 30.5 cents per pound for quota they owned or grew in 1998. If they rented the quota, that amount will be halved with the quota owner.
The money is the farmers' share of a 1998 master settlement between tobacco companies and 46 states' attorneys general to compensate the states for health problems associated with tobacco use.
Georgia tobacco growers will have a chance to vote to keep or end their federal program through a mail-in ballot starting Jan. 5. Voting will last for 30 days. Growers vote on the program every three years.
(Brad Haire is the former news editor with the University of Georgia College of Agricultural and Environmental Sciences.)