Tuesday, October 4, 2011

Update on U.S. Growers Direct contracts

The purchase of tobacco by Alliance One International (AOI) that had originally been contracted by U.S. Growers Direct (USGD) was going smoothly in early October, says Jeff Griffin, AOI manager of leaf affairs. “Because of the hurricane, we are not sure how many pounds are out there. It is very hard to get a handle on the volume of this crop.” But industry observers agree that probably no more than 25 million pounds—and certainly not 100 million pounds as USGD claimed--were ever destined for delivery to USGD. Thanks to low yields, it seems unlikely that even that much will be taken by AOI. Griffin says that USGD farmers report no problem dealing with the AOI prices and grading. “Our contracts are similar, and we have had no complaints about that,” he says. “Farmers seem to be pleased with how this is turning out.” The volume has been very good at the Wilson, N.C., buying station and also in Louisburg, N.C., and Douglas, Ga.Georgia wasn’t affected much by the hurricane,” says Griffin.

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