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October, 2007

Tobacco escapes the frying pan of 2007

The September report from US Department of Agriculture confirmed that the drought and heat had not reduced yield of the national tobacco crop as much as had been feared.

But that was little consolation to the growers of Virginia, Maryland, and North Carolina, who in many cases never got the minimal amount of precipitation needed to produce a good yield.

Growers got very little help from the weather as they were harvesting their leaf in late August and early September.

“You look at this report and it’s like someone put North Carolina in a frying pan,” said North Carolina Agriculture Commissioner Steve Troxler. “We have been seared.”

But the Virginia flue-cured area seemed to have been parboiled even worse, and the damage was so serious that even though a substantial portion of the crop remained to be harvested in mid September, there was little chance that rain–if it were to start falling–would provide much help.

The USDA pegged flue-cured yield in Virginia at 2,000 pounds per acre, down 17% from 2006 (and 18% less than the estimate it had made 30 days before). With planted area up 6% in the state, estimated production was 36 million pounds, down nearly 13 % from the 2006.

In North Carolina, by far the leading flue-cured state, yield was 2,000 pounds per acre, down 4% from 2006. Planted area was up 6%, bringing production to 330 mn pounds, up about 2% from 2006.

For the Deep South flue-cured states, the results were much better, indicating that what little rain had fallen came at opportune moments. Georgia’s yield was up an estimated 18% and with more planted area, production was projected at 42 mn pounds, nearly 40% more than in 2006. South Carolina’s yield was up just slightly while planted area was down a bit, so the estimated production of 49.5 mn pounds was about the same as 2006. Florida was not included in the USD report but yields there have been projected by the Extension Service at 2,400 to 2,600 pounds on planted area of 1,100 acres. Production is estimated at 2.6 to 2.8 mn pounds.

For all flue-cured states (except Florida), yield is projected at 2,250 pounds per acre, about the same as 2006, and production is estimated at 457.5 mn pounds, 2% above 2006.

Burley production is expected to total 198 million pounds, down 9% below last year. Burley growers plan to harvest 105,200 acres, up 2% from 2006. Yields are expected to average 1,878 pounds per acre, down 217 pounds from a year ago. Production in Kentucky, the largest burley-producing State, is projected at 146 million pounds, 5% below. Growers in Kentucky expect yields to average 1,900 pounds per acre, 200 pounds below a year ago. The weather continued to be hot and dry in August, limiting tobacco growth in the majority of the burley States.

Perhaps the worst-hit state was Maryland, where production of burley and a small amount of Southern Maryland leaf was estimated by the state agronomist at 500,000 pounds, 60% less than the year before.

But their neighbors to the north in Pennsylvania enjoyed about the same yield of Southern Maryland and burley as last year and with nearly the same acreage they produced an estimated 2.3 mn pounds of this type and 10.7 mn pounds of burley.

Production of all tobacco types is forecast at 718 mn pounds, 7% below the August 1 forecast and down 1% from 2006.

Germany tobacco growers nearing end of era
Berlin — Germany’s tobacco growers are preparing to exit the industry as the date for the withdrawal of subsidies, the end of 2009, approaches.

Farmer, Markus Fischer, who is the fourth generation in his family to grow tobacco, and probably the last. About a sixth of his 150 ha farm in the southern Palatinate region of Germany is currently grown to tobacco, the farm’s main source of income.

But Fischer was quoted as saying that German tobacco farmers could not cover their overheads without the subsidies. They would not be able to keep producing tobacco for the amount they were currently getting from buyers. He has started looking into alternative crops. He has expanded his asparagus production and started growing strawberries, but he receives much less for these products than he does for tobacco.

Reseachers: organic tobacco could be safer
Mysore — Researchers from the Central Tobacco Research Institute (CTRI) near Mysore claim that organically grown tobacco contains fewer harmful substances than its conventional peer.

Head of CTRI, M.M. Shenoi was quoted that CTRI research proved that organically grown Flue Cured Variety tobacco, used in cigarettes, contained fewer harmful substances such as nicotine, tar, and carbon monoxide.

“It is possible to produce safe cigarette tobacco through organic farming,” Shenoi claims. He does add that the findings were only the “trends” of the research, which is expected to continue for two or three more years before a “conclusion” could be arrived at. “The findings are based on the first year’s trials. We are now in the second year of research. Only after continuing the research for two or three more years, will we be in a position to decide on the promotion of organic cultivation of tobacco among farmers,” Shenoi said.

While organic farming does promise to slash the content of harmful substances in tobacco, Shenoi concedes that the yield of tobacco would be decreased by about 35%, in comparison to conventionally grown tobacco. Yet, he adds that research is on to reduce this gap of yield.

UN helps farmers go commercial
Blantyre — A joint project by the United Nations Food and Agriculture Organisation (FAO) and the Malawian government is helping small-scale farmers to expand into commercial food production.

Initially, 50 “lead farmers” from around the country will receive training in business management skills and planning.

“The project intends to equip farmers with knowledge that would enable them to take farming as business,” said Mazlan Jusoh, the FAO’s country representative in Malawi. Around 80% of the country’s workforces are subsistence farmers who grow maize and vegetables, while the commercial farming sector comprises the large tobacco farms in the south, which account for a large chunk of Malawi’s export earnings.

Jeff Luhanga, controller of agricultural extension and technical services in Malawi’s Ministry of Agriculture and Food Security, said in cooperatives, farmers would have the chance to speak with one voice and negotiate for better prices for their produce: maize, tobacco, paprika, or whatever they were growing.

Tobacco production shrinking
Putrajaya — Declining demand and the government’s campaign against smoking have been cited as the reasons for the shrinking production of tobacco in the country.

National Tobacco Board

(LTN) Deputy Director-General (Development) Baruddin Ismail said recently LTN had reduced the annual production quota for tobacco leaves to 9 mn kgs this year from the 15 mn kgs previously. The number of active tobacco growers had dropped to 4,000 compared to about 12,000 several years ago and the number of curers had come down to 106 from 360, he told reporters.

Baruddin said LTN would ensure that the existing tobacco growers and curers derived profit from their venture, but noted that their business depended on the demand from manufacturers.

As such, he said, less active tobacco growers would be encouraged to shift to alternative crops under a restructuring in the tobacco industry.

Baruddin spoke to reporters after the presentation of assistance under the Tobacco Growers Transitional Aid (BPPT) programme for Perlis, here.

He said the manufacturing sector had also reduced cigarette production to 16 bn sticks annually from about 21 bn several years ago.

On the BPPT, he said LTN had allocated RM86.6 mn for distribution to tobacco growers under the program.

United States
Keep fires under control, agriculture commissioner pleads
Frankfort — Dark fire-cured growers in Kentucky were urged to take care not to let barn fires get out of control during the curing process.

“As dry as it is in western Kentucky, a barn fire could grow into a wildfire that could do serious damage to a farmer’s property as well as that of his neighbor,” said Agriculture Commissioner Richie Farmer. “I urge all dark fire-cured tobacco growers to act to prevent barn fires and take measures to control a fire before it starts.”

Among other things, he advised farmers to avoid the use of green or unseasoned wood that may burn hotter than normal. - (Bickers)

Burley in danger of quick curing
Lexington – The relentless heat and low humidity of the summer and fall have lead to some instances of “quick” curing of burley, in which the leaf dries before it cures. In Kentucky, burley growers were advised to open vent doors at night or during periods of high humidity and keep them closed in dry periods during the day.

The idea is to allow the moisture of evenings and rainy days to migrate into the curing structure and bring the tobacco into a pliable or non-shattering condition, said Gary Palmer, University of Kentucky Extension tobacco specialist. “For those who want to wet down the ground of the barn to add humidity, do this in the late afternoon or early evening. The calm winds and higher outside humidity at night will let more of the added moisture remain in the barn.” - (Bickers)

Tobacco Contractors Approved
Harare — The Tobacco Industry and Marketing Board has approved nine contractors to assist in the production of the targeted 60,000 hectares of tobacco for the 2007/08 growing season.

The contractors are Alliance One, Chidziva Tobacco Processors, Gold Driven Investments, Tian Ze Tobacco Company, Zesa Enterprises, Zimbabwe Leaf Tobacco Company, Zimbabwe Tobacco Growing Company, Mannelie Investments and Saltlakes. TIMB Acting Chief Executive Dr Andrew Matibiri said there were three other contractors whose applications were yet to e approved.

Besides the production of flue-cured tobacco, contract growing was also expected to help in the production of the 400 hectares of burley tobacco and the 50 hectares of oriental tobacco whose inputs would be supplied by a cigarette manufacturing company.

Although cropping inputs, especially fertilizers, are generally not available, contractors are expected to help ease the burden for tobacco producers.

“Inputs are generally not available on the market and most large-scale growers seem to be seeking inputs by entering into contract schemes,” Dr Matibiri said.

Coal availability may be a hindering factor in tobacco production next season because of viability challenges being faced by Hwange Colliery.

Flue-cured market ends on optimistic note
Harare — Zimbabwe’s flue-cured auctions for 2007–the first which enjoyed government price support—ended officially in early September with almost 70 mn kgs of leaf sold, according to the Zimbabwe Tobacco Industry and Marketing Board (TIMB).

Specifically, 68.8 mn kgs of flue-cured worth nearly $160 mn had been sold when scheduled sales ended on September 7. A small amount more was expected to be sold in “mop up” sales, which are expected to end in late September or early October.

Zimbabwe Tobacco Association Chief Executive Rodney Ambrose said the country might reach 80 mn kgs when all was said and done.

“This is one of the best marketing seasons we have had in terms of marketing as we have had support from the government and the central bank.”

TIMB also applauded the Reserve Bank of Zimbabwe for introducing the support price, saying it induced viability in the sector.

The season began under a cloud as pricing disputes delayed the start of sales season, officials said Monday. The support price, which was quite an innovation in this market, got things under way. But several other problems dogged the auctions, notably a shortage of wrapping papers. The Government had to intervene to make wrapping available.

But all that seemed to be forgotten at season’s end and there was much brave talk about a bigger crop next year. TIMB chief executive Andrew Matibiri predicted that Zimbabwean farmers would produce 120 mn kgs next time around.

“We intend to have 60,000 hectares of land under tobacco to produce 120 mn kgs of tobacco,” he told African media. “This means that we will be having a 50% increase of tobacco on the ground. Although we have the usual problems of lack of inputs such as fertilizer and power outages, we are confident we will be able to reach next years target.”

It was noted that as recently as 2000, tobacco production reached 236.13 million kgs, a record high.

The market price was initially supported at a rate of Z$40,000 per kg of tobacco that attracted a price of US$150. Lower priced tobacco receive a support price calculated on a pro-rata basis. Later, the base support price was raised to $55,000 per kg. - (Bickers)

Tobacco International - October, 2007

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