Wednesday, April 3, 2013

USDA QUESTIONS: WILL THE EXPECTED BOOM IN ACREAGE REALLY MATERIALIZE?

A farmer transplants flue-cured near Raeford, N.C.


The big crop that was projected for burley and especially for flue-cured has apparently not materialized.  Or at least, not as of the first two weeks of March. That's when USDA's National Agricultural Statistics Service (NASS) surveyed a sample of tobacco farmers and used their responses to prepare its Prospective Plantings report, which was issued last week. Briefly, it said flue-cured growers would increase their acreage by only six percent and burley growers by only two percent. [See the state-by-state analysis below.] I say "only" because all the evidence I heard over the winter was that growers of both types were planning a much more significant acreage increase. That actually is what NASS projects for flue-cured in South Carolina (up 25 percent), Georgia (up 10 percent) and Virginia (up 10 percent). But North Carolina, the major flue-cured state, is projected up only four percent. For burley, meanwhile, Tennessee, the number two state, is projected down 12 percent, and Virginia is projected down a whopping 30 percent. In the 30+ years I have been in this line of work, I have learned that USDA reports usually have a certain amount of credibility. But I don't know about this one--it simply looks off. The high points appear below, and you can find more details athttp://www.nass.usda.gov/ (click Crops & Plants, then follow the prompts). Watch future issues of TFN for further analysis and check my blog (http://modtob.blogspot.com) for the latest news.
--Chris Bickers

USDA-NASS Prospective Plantings Report (3/28/2013) 

Flue-cured:
  • North Carolina-170,000 acres, up four percent;
  • Virginia-22,000 acres, up 10 percent;
  • South Carolina-15,000 acres, up 25 percent;
  • Georgia-11,000 acres, up 10 percent.
  • All flue-cured--218,000 acres, up six percent.
Burley:
  
  • Kentucky--78,000 acres, up five percent;       
  • Tennessee--14,000 acres, down 12 percent;       
  • Pennsylvania--5,100 acres, up nine percent;      
  • North Carolina--2,100 acres, no change;      
  • Ohio--2,000 acres, up five percent;     
  • Virginia--1,900 acres, down 30 percent.      
  • All burley--103,100 acres, up two percent.  
Fire-cured: 16,680 acres, up two percent
Dark air-cured: 5,000 acres, down four percent.
Cigar types: 4,850 acres, up nine percent. 
Southern Maryland: 2,000 acres, down 31 percent. 

In other news:
Two familiar faces in tobacco work are moving on. Danny Peek, Virginia Extension burley specialist, has been named director of the Virginia Extension's Southwest District. Peek, who is now stationed in Abingdon, is holding both positions until a new specialist is hired...Paul Denton, Tennessee Extension tobacco specialist, will retire at the end of May. The university plans to replace him, although the timetable is open. Like Denton, his replacement will divide his time between burley in Tennessee (75 percent) and Kentucky (25 percent). The only change in the job description will be that the new person will have some research responsibilities, Denton says.

By the way, neither Peek or Denton finds the Prospective Plantings projections convincing. Peek is mystified by the Prospective Plantings projection for Virginia burley of only 1,900 acres, 30 percent less than last year. "I was expecting a seven to 10 percent increase!" he says. "I can't believe our acreage will be down that much." He says that buyers still tell him that the mountain burley of Virginia, Tennessee and North Carolina offers some desirable quality characteristics in the current market.
The 12 percent drop projected in Tennessee for burley seems too much to Denton. "I think by the time we finish planting we will have crept back close to last year's acreage," he says. But there has been one obstacle to increased plantings: the changed rotation rules for crop insurance. "Now, you can't get crop insurance for tobacco planted a third consecutive year [on the same land]. That apparently is going to impact more farmers than we might have expected." 
In the Piedmont of North Carolina, auction operator Dennis White of Rural Hall says he is expecting much more than four percent more flue-cured in his area. "I think that the price will lead to more acres than that," he says. He doesn't have a firm figure in mind but says that 10 percent would be closer to the mark. Whatever the increase, White expects to sell more tobacco at Old Belt Tobacco Sales warehouse this year. "We have heard from a lot of farmers who want to sell with us," he says. He has even provided contracts for a few farmers who needed them to arrange financing.
Could the shortage of curing barns have depressed planting intentions of flue-cured? By all reports, used barns are selling at very high prices, and few remain available for sale. And every manufacturer of flue-cured barns I have talked to recently has told me he expects to build all the new barns his facilities will allow. 


A short course on tobacco: A group of farmers and representatives of government and allied industries participated recently in a short course designed to promote efficient, quality tobacco production held recently in Raleigh.
  • Tobacco farmers enrolled in the N.C. State Tobacco Short Course included (from N.C. except as noted): Kyle Norris of Burlington; Archie Griffin of Washington; Garrett Gore and Justin Gore of Nakina; Jason Dixon of Oxford; Jordan Boyette of Clayton; Loren Thornton of Four Oaks; Peyton McDaniel of Whitakers; Phillip Watson of Whitakers; Scott Clayton of Cedar Grove; Shawn Whitt of Rougemont; Tyler Dunn and Jordon Tyson, both of Ayden; Robert Fann and Brittany Tew Fann, both of Salemburg; Curtis Godwin of Dunn; Kristal Jones of Mt. Olive; Will Sheldon Strickland of Mt. Olive; Jed Spain of Plymouth; Justin Williams of Goldsboro; Spencer Davis of Wilson; Halifax County, Va., grower Garland Comer and Pittsylvania County, Va., grower and Extension agent Stephen Barts.

  • Industry and government participants included Shannon Parker of Four Oaks, Alex Sereno and Sandy Yeatts, both of Raleigh, all of the Risk Management Agency; Chris Garris of Gas Appliance Service in Greenville; Phillip Strickland of McLamb Farm Services in Dunn; and Joe West of AgriTechnologies in Clinton; Aurora Toennisson, N.C. State University graduate student in the Entomology Department of Raleigh; and five N.C. Department of Agriculture employees : John Council of the Upper Mountain Research Station, Laurel Springs; Steven Mills, Upper Coastal Plains Research Station, Rocky Mount; Blair Owens and Lloyd Ransom, both of the Border Belt Tobacco Research Station, Whiteville; and regional agronomist Dwayne Tate of Asheville.

The program was conducted by the N.C. Tobacco Foundation in partnership with the College of Agricultural and Life Sciences at N.C. State University. A grant from the N.C. Tobacco Trust Fund Commission helped fund the program.


A make-your-own approach to creating more barn space: The most pressing problem for flue-cured growers this season was featured in one segment of the Tobacco Short Course program. The participants paid a visit to the farm of their fellow student Kristal Jones of Mount Olive and her husband Tony. The attraction was the Jones unusual approach to acquiring more barn space: They are making their own. Using local labor, Tony believes he can "home-make" a bulk barn for about two thirds of the cost of a new commercial unit. Robert Fann of Salemburg, N.C., a short course participant, was impressed. "We have enough barns this year that we don't need to get any more," says Fann. "But seeing Tony build his own barns makes me think I could do it if I had to. I want to talk to him after the season is over and find out if he thinks it is a good strategy." Besides learning opportunities like this, the short course offered "a good opportunity to make contacts with other farm people in the area that I hope to continue for years to come," Fann said. "There should definitely be a residual value from the short course."




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