University of Georgia
Extension Agronomist-Tobacco

Topics for this issue include:
Blue mold has been discovered in southern Georgia
Tobacco Livelihood and Economic Assistance for our Farmers Act of 2002 (Introduced in the House)
TOBACCO NEWS
---Farmers Vote To Expand U.S. Grading Of Tobacco
---Growers of Burley, Flue-Cured Tobacco Approve Grading

Blue mold has been discovered in southern Georgia
Blue mold has been discovered in Tift County in southern Georgia, near Eldorado. About 2 acres of plant beds were infected. Strong disease activity was present. There were signs that blue mold may have been present since the beginning of March as systemic blue mold causing darkened plant stems and leaf veins, but may have gone unrecognized as no blue mold was being produced on the outside of the plants. On a later visit to the beds the typical yellow discoloration on the leaves along with the blue mold. It is likely that other crops in the southern GA and northern FL region have already been exposed. Growing areas in the Carolinas may also have been threatened by spores from this source during recent periods of favorable weather. All tobacco plant producers in flue-cured production areas are encouraged to scout their plants carefully for signs of blue mold. Dithane is labeled as a preventative for the plant beds and plant houses. To see images of these beds and witness the disposal of the beds click on the first item under Breaking News !! on the Georgia Tobacco Web Page http://georgiatobacco.com

Tobacco Livelihood and Economic Assistance for our Farmers Act of 2002 (Introduced in the House)
Perhaps the most recent public action toward a buyout of tobacco quota is likely a bill introduced by Representative Mike McIntyre of North Carolina. To read a copy of the bill and to keep up with the bill's progress, visit the following web site and enter the number of the bill, H.R.3940.
"Thomas Legislative Information on the Internet"
http://thomas.loc.gov/
H.R.3940
Sponsor: Rep McIntyre, Mike(introduced 3/12/2002) http://www.house.gov/mcintyre/News/031202b.htm
Latest Major Action: 3/12/2002 Referred to House committee
Title: To eliminate the Federal quota and price support programs for tobacco, to compensate quota holders and active producers for the loss of tobacco quota asset value, to establish a permanent advisory board to determine and describe the physical characteristics of United States farm-produced tobacco and unmanufactured imported tobacco, and for other purposes.

Latest Major Action: 3/12/2002: Referred to the Committee on Agriculture, and in addition to the Committee on Energy and Commerce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.

TOBACCO NEWS

Farmers Vote To Expand U.S. Grading Of Tobacco
Source: Richmond Times - Dispatch

A majority of tobacco growers want government graders to judge the quality of tobacco sold to cigarette companies under contract, according to preliminary results of a farmers' vote. In a referendum held March 11-15 in Virginia and other tobacco- producing states, 56 percent of flue-cured tobacco farmers who voted favored mandatory grading of leaf at all sales, the U.S. Department of Agriculture reported yesterday. Support was much stronger among burley tobacco farmers, who voted by a 3 to 1 margin for mandatory grading.

If confirmed, the vote means the USDA will require federal graders at nonauction tobacco sales, said William Coats, associate deputy director of the USDA's agricultural marketing service. Grading determines the price farmers get for their tobacco. For years, USDA graders have judged the quality of leaf sold at auctions, but traditional auctions have declined drastically during the past two years as many farmers started selling their crops directly to companies under contracts. Last year, about 80 percent of the flue-cured crop bypassed the auctions.

Most companies have assigned their own employees to grade that tobacco when farmers bring it to company-run receiving stations. Farm groups urged growers to vote for mandatory grading to help maintain some of the protections they have had at traditional auctions. The vote must be certified by state Farm Service Agency offices. Final results will be released in April.

Growers of Burley, Flue-Cured Tobacco Approve Grading Referendum
Source: Knight Ridder/Tribune Business News

Mar. 22--Preliminary results of a referendum on tobacco grading indicate a majority of burley and flue-cured tobacco growers in several states are in favor of mandatory federal grading of tobacco at all tobacco sales. The referendum was conducted last week by county Farm Service Agency offices in tobacco-producing states. Preliminary results were released Thursday by the USDA's Agricultural Marketing Service. The results will be verified by state farm service offices, and a final result should be released by the second week of April. In a press release, the Agricultural Marketing Service reported 75 percent of burley growers who voted are in favor of mandatory federal grading wherever type 31 burley is sold.

Burley growers in several states, including Kentucky, Tennessee, Virginia and North Carolina, voted in the referendum. Fifty-six percent of growers of flue-cured tobacco types 11, 12, 13 and 14 were also in favor of mandatory grading for their leaf. When the results are finalized, the USDA will revise regulations to require federal graders at all burley and flue-cured tobacco sales, said William Coats, associate deputy director of the Agricultural Marketing Service's tobacco program.

The yes vote will mostly affect sales at tobacco company receiving stations. Federal tobacco graders have been present at tobacco auctions for years -- with farmers paying a fee for the service. Graders are a crucial part of the federal tobacco price support system: A tobacco grower must have his tobacco graded by a USDA grader to be eligible for price supports. Under the price support system, graders assign a "grade" to each type of leaf -- with a minimum sale price attached to each grade. Tobacco cannot be sold at auction below the minimum price.

When tobacco companies began contracting directly with farmers to purchase their crops, the number of burley pounds going to warehouses dropped. In 2001, more than 60 percent of the nation's burley crop was sold directly to tobacco companies through contracting stations. With fewer growers paying the grading fee, the number of USDA graders declined. "This is very good news for us," said Brian Furnish, a government relations official with the Burley Tobacco Growers Cooperative. "We think it's very important to keep graders in the receiving stations." The federal grading service, Furnish said, "was facing bankruptcy. In order for us to offer price supports, (tobacco) must be inspected" by a federal grader, he said.

The cooperative engaged in an extended effort to encourage growers to vote for mandatory grading. "We sent out mailers (to growers) and did a lot of newspaper articles, because this was very important to us," Furnish said. The referendum does not mean that federal price supports will be available in contracting stations, said Dan Styke, director of the Daviess County Farm Service office. "If I went to a receiving station and the USDA grader graded my tobacco better than the company grader, I'm not automatically guaranteed that USDA price," Styke said. "Contract sales are private sales between the buyer and seller." In contract sales, tobacco companies will continue to set prices based on their company graders' recommendations, Styke said. If a grower receives a higher grade from the USDA than from a tobacco company grader, the grower will have the option of taking his leaf to a tobacco auction, Styke said.

Before the auction, the leaf will be graded by a second group of USDA graders. Having USDA graders in company receiving stations will offer growers a measure of security, said Rod Kuegel, former president of the Burley Tobacco Growers Cooperative. A USDA grader will be able to give a grower at a receiving station a second opinion on the value of his crop, Kuegel said. "(A grower) doesn't get the price support," at a receiving station, Kuegel said, "but he does get the education, so he doesn't get taken advantage of. It protects him. "Our Kentucky growers voted 85 percent" in favor of mandatory grading, Kuegel said. "I'm real proud of our Kentucky growers understanding the importance of the grading system." Kuegel said Philip Morris USA -- the nation's largest purchaser of U.S. tobacco -- conducted a public relations campaign to convince farmers to reject mandatory federal graders. "If Philip Morris was against it, we would have to realize it would be good for us," Kuegel said. "They spent several million dollars trying to get us to vote that out." A referendum for growers of dark tobacco varieties is also under way. Preliminary results should be available next week, Coats said.