Tobacco Farmer Newsletter: September 2013

Tuesday, September 17, 2013

Auction price holds up

A worker cleans off the baling area on a flue-cured farm near Sanford, N.C.

At the Piedmont Warehouse in Danville, Va., 120,000 pounds of flue-cured was sold last Thursday, the last day of auction sales last week, says Jim Eggleston, sales manager. "We averaged $2.15 a pound. That included some cut rag," he says. "The week before, we had a little better tobacco on the floor, and the average was $2.22." Last Thursday, the practical top was $2.28. "Our quality continues good. We could use some rain to fill out the tops. I know some farmers who are irrigating now." Crop progress varies widely, he says. "Some farmers have finished harvesting and some haven't primed at all. That's the Old Belt for you." An early killing frost would be a problem in this area. "If we don't get one, we may be harvesting till November."

Reports from the field...

North Carolina: Most of the flue-cured crop will be harvested or at least ready for harvest by the end of this month. "But limited barn space will likely extend harvest into October, even though most of the tobacco will be mature and ripe," says Loren Fisher, N.C. Extension specialist. How much was produced? One can only guess, but Fisher thinks N.C. volume might fall at around 310 million pounds. "It will definitely be closer to 300 million than 400 million." Whatever the volume, the quality of much of the N.C. crop is exceptional, says Fisher. "Farmers generally are very pleased with the prices they are receiving and just wish they had more to sell," he says...The executive vice president of the Tobacco Growers Association of N.C. is not optimistic about the Tar Heel market. "It will not be a big finish," says Graham Boyd. "Half of the North Carolina crop was out of the field by Labor Day, and some farmers sold for the final time the week after the holiday. We will miss target by 30 percent."

Kentucky: The burley crop is better than was expected two months ago, says Bob Pearce, Kentucky Extension tobacco specialist. "About 60 percent has been harvested which is a little behind normal, mainly because much of it was planted later than normal," he says. There has been one good bit of news, he says. There was not as much abandonment due to heavy rains in early July as we expected. "In mid July, it looked like 10 to 15 percent of the acreage would not be harvested. Now it looks like it was closer to five percent." Entire fields weren't generally abandoned. "It was just patches within fields." The quality should be good, but Pearce says the cured leaf weight may be a disappointment in some cases. "The plants will feel heavy when you harvest them, but so much water will be lost in the cure that the cured leaf weight may not live up to expectations ."

Space high-moisture burley wide on the rail: Stanley Holloway, Yancey County (N.C.) Extension agent, said that considering the growing conditions, farmers in western North Carolina are looking at wider spacing of their sticks on the tier rails. "This will allow more air movement," he said. Be sure all available space is uniformly filled. "Air does not circulate well through tobacco in partially filled barns," Pearce says.

For the record: USDA's National Agricultural Statistics Service issued its September Crop Production estimate on September 12. Its tobacco figures don't seem any more credible than they did in August, but here they are for anyone who would like to review them.

Flue-cured: NC--340 million pounds; VA--52.9 million pounds;GA--29.2 million pounds; SC--17.1 million pounds; US--439.2 million pounds.
Burley: KY--156 million pounds; TN--21.8 million pounds; PA--12.7 million pounds; OH--4.5 million pounds; NC--3.5 million pounds; VA--3.0 million pounds; US-- 201.7 million pounds.
Fire-cured: KY--36.7 million pounds; TN--23.6 million pounds;VA--800 million pounds; US--61.1 million pounds.
Dark air-cured: KY--12 million pounds; TN--2.6 million pounds;US--14.6 million pounds.
Cigar: US--Nine million pounds.
Southern Maryland: PA(US)--4.7 million pounds.

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Wednesday, September 4, 2013

Is the flue-cured market heading for another big finish?

This Wake County, N.C., farmer finishes harvest of his flue-cured in this field on August 9.

The first sale of September continued the good prices and relatively few "no sales" that has characterized the auction season since it began on July 31. The Old Belt Tobacco warehouse of Rural Hall, N.C., held a sale on September 3 and sold 170,000 pounds at an average price of $2.04 per pound. "The top price was $2.20 per pound for good grade cutters," says owner Dennis White. There were a few lugs for sale, but 95% of the tobacco on the floor Tuesday was cutters. "X grades generally brought $1.75 to $1.80 per pound, with a few X1s selling for $2 a pound." No tickets were turned. "Everybody left tickled," he says. Unless contract prices are raised again, White thinks auctions will average 10 to 12 cents higher.

More production than projected? In Wilson, N.C., last week, the average price was $2.07:7 per pound at the flue-cured auction at Big M warehouse."The practical top was $2.20 a pound," says owner Mann Mullen. "All leaf offered at the sale attracted a bid, and very few bids were rejected." There were a lot of cutters on the floor and only a little leaf. "Leaf has been coming in faster, but I think some growers are holding theirs because they think the price might get higher." It may, but Mullen thinks there may be more leaf out there than expected. "The top of the stalk has responded to extra nitrogen and new root growth," says Mullen. "I think production may be more than what has been projected."

Getting better in the Bluegrass: In Kentucky, things are looking up in the Central Bluegrass. "We have had a remarkable rebound," said Roger Quarles of Georgetown. "Some (of the stalks) are almost too big to handle." Harvest is in full swing. Leaf will be on the thin side, and on Quarles' farm, perhaps 10 percent of poundage will be lost due to the rainfall in early July. "But that is much improved from what we expected a month ago," he says. "If we can just get it into the barn, I think we will be all right." Everyone in Central Kentucky lost nitrogen thanks to the rain, and there was much supplementation. Quarles sprayed liquid nitrogen underneath the leaves directly onto the soil using a high clearance sprayer with drop nozzles. "It was a lot of extra work, but leaf colored back up afterward," he says. Quarles thinks that many of the tobacco roots suffocated immediately after the torrential rains on Independence Day weekend, and the crop looked bad. "But the roots started growing again two to three weeks later, and it began looking better," says Quarles. "We may not have lost as much nitrogen as earlier believed.

Yield will fall: In southwest Virginia, farmers didn't get the overwhelming precipitation that many others did. But there was nevertheless more than was needed, says Danny Peek, Extension agronomist in Virginia. He projects that yield will fall between 1,700 and 1,800 pounds per acre. Either yield level would be on the low side. But production will be considerably higher than the USDA had projected earlier, largely because that agency had greatly underestimated planted acreage in southwest Virginia at 1,700 acres. A more accurate planting estimate was compiled in August indicating that acreage was 2,700, about a thousand more than USDA calculated. That would suggest that production for the year will be somewhere between 4.6 and 4.9 million pounds, close to what it was in 2012.

Top quality in the Tar Heel state: In North Carolina, farmers were harvesting all across the state as August drew to an end. Some in the Coastal Plain had finished completely. But conditions varied across the state, so it was hard to say how much of the crop has been harvested, or even how many operations are completely finished, said Matthew Vann, N.C. Extension crop science associate. The crop is a little light in weight, he added, not surprising under the circumstances. The best estimate he had was that total loss on N.C. flue-cured was somewhere in the 20 to 25 percent range. "But the crop is curing very well, and everything I've seen looks very good," said Vann. "We will have another top quality crop, and that's really a testament to our growers."

The truth about flue-cured acreage: In South Carolina and Georgia--and the flue-cured belt as a whole--some clarity has been achieved on the planted acreage question. You will recall that USDA's NASS has consistently projected plantings that were much lower than what Extension and state department of agriculture specialists in South Carolina said they observed and much higher than what Extension and department of agriculture specialists in Georgia said they observed. Now, USDA's Farm Service Agency has issued a report on tobacco acreage. It shows that flue-cured plantings in S.C. were 14,045 acres, up considerably from the 9,000 acres that NASS has projected, while plantings in Georgia are 13,189 acres, somewhat short of the 15,000 acres projected by NASS but still a good bit more than what the state specialists expected. Reported for other flue-cured states: Virginia 21,000 acres (down 2,000 acres from the most recent NASS estimate); N.C., 175,000 acres (up 5,000 acre from the NASS estimate); and Florida, 1,280 acres (Florida isn't included in NASS estimates).