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.”
