Thursday, September 15, 2011

A soft place to land, P. 2: Alliance One to the rescue

The U.S. Growers Direct debacle has been resolved, at least to some degree. Aliance One International decided this morning to offer to accept delivery of all tobacco contracted by USGD. It will use its own price schedule and will pick the tobacco from the USGD buying station at which it was contracted. USGD staff will be retained to buy and handle the leaf, and these individuals will be supervised by Alliance One personnel. But USGD growers will have the option of selling to any other buyer they may want to, with no penalty. Jeff Griffin, Grower Affairs manager for the leaf department of Alliance One, told an emergency meeting in Wilson, N.C., of the Tobacco Growers Association of North Carolina (TGANC) this morning (September 15) that his company just decided to take this step earlier in the day. "It is effective immediately, but growers should not deliver their tobacco to their buying station until they receive instructions from the agent they have dealt with," he said. The 100 or so farmers who attended the meeting were delighted by this news (and to tell the truth, so was I). Graham Boyd, executive vice president of TGANC, said that the Alliance One decision amounts to a "rescue" of USGD growers, and it will benefit the market as a whole. "It means this tobacco won't have to hunt for a home," he said. "It gives a formal method for this tobacco to enter the marketplace." I have more details but I will hold them so I can get this out. I wrote this rather quickly so please forgive any typos.

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