Message from the Marketplace VOLUME SHORT, DEMAND HIGH, PRICES STRONG

 

caption: Buyers are bidding up prices for scarce tobacco at auctions this year. This photo shows a sale from a few years ago at the Old Belt Tobacco Sales warehouse in Rural Hall, N.C. File photo taken by Christopher Bickers. "Prices [are] as strong as I've ever seen," says one N.C. Warehouseman Sales of flue-cured tobacco at the four auction warehouses were vigorous in September, and there seems every reason to think this will continue through October. In the N.C. Eastern Belt market town of Wilson, prices on auction have been very good lately “The prices are as strong as I have ever seen them on auction,” says Tommy Faulkner, auction manager at American Tobacco Exchange in Wilson. “We have mostly Leaf on the floor now and we’re getting $2 to $2.20 to $2.30 for it.” It is clear that this crop just isn't big enough to meet the demand. Why the shortfall? A lot of things happened to this crop, starting with a short supply of plants. “Then, too much adverse weather contributed to making it short crop. But what we are selling now is good tobacco.” Sales on the Wilson market began on August 16, and there have been seven so far. Faulkner thinks American Tobacco Exchange will hold sales on into November.   Also in the N.C. Eastern Belt, Kenneth Kelly, owner of Horizon auction warehouse in Wilson, says all qualities and all stalk positions are selling well. “Even prices for rag tobacco are up substantially,” he says. “Right now, most of what we have to sell is Leaf, but there are still some Lugs and Cutters on offer.” One thing Kelly has noticed is that the very best quality leaf isn’t making it to the auctions this year. “It is being absorbed by the primary companies,” he says...He thinks a November end of sales is possible. At the single auction warehouse in the N.C. Old Belt, auction deliveries at the Old Belt Tobacco Sales in Rural Hall (near Winston-Salem) are running about three weeks late. Only three sales have been held so far. There is still plenty of potentially good tobacco in the field. “So if the frost holds off, we may well be holding sales till close to Thanksgiving,” says Dennis White, owner of the Old Belt Tobacco Sales. The sales so far have gone very well. “Most of the Leaf we have moved has brought at least $2.30 a pound, and even pickouts have brought $1.35 a pound. What has been brought to this warehouse so far has been good-bodied, good orange leaf, and we are seeing prices close to contract prices.”   HARVEST UPDATE   In Florida and Georgia, harvest is complete and marketing is nearing its end. USDA estimated the Georgia crop at 12.6 million pounds, says J. Michael Moore, Georgia Extension tobacco specialist. Some sources in the trade think it might be up to two million more. But even the higher figure would reflect a relatively low yield. “At this point, 2,000 pounds per acre would appear a realistic yield estimate,” he says. Moore estimates Florida production at 1.5 to 1.75 million pounds.   In South Carolina, harvest was complete a couple weeks ago, says William Hardee, S.C. Extension tobacco specialist. “Everything is out of the barn, and has been selling good.” Overall, this is an above average crop, he says. “The exception might be the small amount that was harmed by Idalia. There were reductions in yield and quality in those areas.”   In Kentucky, harvest is nearly complete, says Bob Pearce, Kentucky Extension tobacco specialist. A handful is still cutting. "We probably have 85 percent or more that has been cut.” Curing is well under way. “We have had many foggy mornings, especially in the low-lying areas, which helps. A few farmers have started stripping. Everything is moving at a good pace.”   In Tennessee, Rob Ellis, Research Center Director at the Highland Rim AREC in Springfield, says his staff finished cutting the fire-cured, dark air-cured and Connecticut tobacco on the station grounds this week. “And it looks like quite a bit of the tobacco out in the county (Robertson) has been cut.: Curing weather has been good,, although there were thunderstorms this week that may have slowed things down. Ellis thinks the local production should be at least average and maybe above…Note: There is only one burley grower left in the county. How far had the different types  progressed as of September 24, according to USDA-NASS? (Burley/Dark) KY--85% harvested; TN--75% harvested; NC--62% harvested. (Flue-Cured) VA--90% harvested; NC—73% harvested. SC, GA and FL have completed or substantially completed harvest. A Final Thought: Is Connecticut Broadleaf in the South For Good?   The jury is still out on the viability of Connec-ticut broadleaf in the South. It doesn’t fit well on every farm in Tennessee but there are plenty of burley farms where it can work just fine, says Daniel Green, chief executive officer of Burley Stabiliza-tion Corporation in Springfield, Tn. “It’s a high risk/high reward crop,” he says. “You have to trade off a certain amount of yield in order to target quality.”

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ALS, IDALIA FRUSTRATE GROWERS

 

Angular leafspot destroyed this dark fire-cured tobacco in Kentucky in September.   In western Kentucky and north central Tennessee, angular leafspot (ALS) continues to wreak havoc on the dark types. “Many farmers are destroying heavily infected fields,” says Andy Bailey, Kentucky-Tennessee Extension dark specialist, “If the disease has gotten in the top of the plant, there’s not much to do but harvest it soon or work with your crop insurance agent”…How much has been lost? The USDA September estimate for fire-cured is 38 million pounds, which Bailey says is about what he would have expected if ALS hadn’t broken out. “As it is, I will be surprised if we end up with 30 million pounds,” he says. The USDA projection for September places dark air-cured production at 12.6 million pounds. ALS losses for dark air-cured won’t be as heavy as for fire-cured since much of the dark air-cured crop is grown in areas where angular leafspot is less. Still, Bailey says, “We might not produce over 10 million pounds” of dark air…Bailey attributes much of the ALS outbreak to a number of intense rain events during the growing season. “Some crops that have suffered the worst damage from ALS have had over 30 inches of rainfall since July 1,” he says. “If the bacteria that causes ALS is present on tobacco leaves, heavy rains can drive the bacteria into the leaves”…Of the other types grown in this area, ALS tends to affect Connecticut Broadleaf quite a bit less than it affects dark tobacco, and it is almost never seen on burley.   In Georgia and Florida, the quality of the tobacco offered has been good, the price paid has been reasonable, but there just has not been enough of this crop to sell. “We will definitely come up short of expectations," says J. Michael Moore. “As of August 1, the size of the crop was estimated at 14 million pounds. Now USDA’s estimate is 12.6 million pounds, which seems credible. “That is quite a loss in production. Weather problems all season caused production problems."…Things farmers would like to forget about Hurricane Idalia: One farmer had 200 acres that was waiting to be stripped when the storm blew in. “Idalia stripped it. There was none to harvest.” On another farm, the roof of a storage shed was blown off, rendering the tobacco inside drenched and unusable….Since Idalia, growers in Georgia and Florida have hurried to get any leaf that was salvageable out of the field, with considerable success: Moore knows of only two growers who are still harvesting. The two Georgians should be done some time next week, he says…“We will be selling this crop until it runs out,” says Moore. That will be soon, possibly by the end of September.   In North Carolina, the end of the season is drawing near, says Matthew Vann, N.C. Extension tobacco specialist. “All indications are that growers are harvesting as fast as they can in most places. I think there’s a good chance we might finish sometime in early October. I'm not overly concerned about a late crop this year.” If harvest ends before October 12, it would be the first time it has ended before the North Carolina State Fair in several years, he noted….One problem in the field: “We have seen some brown spot in isolated areas, possibly caused by many days of heavy dew and or high humidity, says Vann...USDA projects flue-cured production in N.C. at 237 million pounds. But Vann is just optimistic enough to think growers might exceed that volume. “Our yield appears better than in a number of years,” he says.   Crop progress report from USDA-NASS (as of September 10) (Flue) GA--94% harvested; SC--93% harvested; NC—73% harvested; VA--90% harvested. (Burley/Dark) KY--64% harvested; TN--55% harvested; NC--37% harvested.   What the September crop projection from USDA tells us. Following are estimates based on USDA’s September 1 survey (expected pounds with percentage change from last year’s final, arranged by state and type):   Flue-cured ·             North Carolina—237.3 million pounds, down 6%. ·             Virginia--29.4 million pounds, up slightly. ·             Georgia--12.6 million pounds, no change. ·             South Carolina--12.1 million pounds, up slightly. ·             All U.S.--291.5 million pounds, down 3%.   Burley ·             Kentucky--53.2 million pounds, up 5%. ·             Tennessee--4.35 million pounds, up 4%. ·             Pennsylvania--2.75 million pounds, down 15%. ·             Virginia--420,000 pounds, down 16%. ·             North Carolina--240,000 pounds, down 11%. ·             All U.S.--60.96 million pounds, up 4%.   Fire-cured ·             Kentucky--22 million pounds, down 28%. ·             Tennessee--15.8 million pounds, down 1%. ·             Virginia--220 thousand pounds, down 33%. ·             All U.S.--38 million pounds, down 25%. ·               Dark air-cured ·             Kentucky--9.88 million pounds, down 35%. ·             Tennessee--2.53 million pounds, down 73%. ·             All U.S.--12.41 million pounds, down 50%.   Pennsylvania Seedleaf ·      Pennsylvania--9.6 million pounds, up 1%.    Southern Maryland ·      Pennsylvania--132,000 pounds, down 42%.   Tobacco, All types: ·      Total US--413 million pounds, down 7 percent   REPORT FROM OVERSEAS Southern Brazil's tobacco production for the 2022/2023 harvest reached 605,703 tons. The figures were finalized this week by the Brazilian Tobacco Growers' Association (AFUBRA) and were obtained through surveys carried out during the harvest with tobacco growers. By type: Flue-cured, 551,586 tons; Burley, 46,469; and Galpao, 7,649 tons. Compared to the previous season, plantings increased 6.1% from 246,590 hectares to 261,740 hectares. Production grew from 560,181 tons to 605,703 tons, an increase of 8.1%. The average price paid to tobacco growers in 2021/2022 this season was R$18.12, a variation of 6.5%...A slight increase in plantings is expected for next season.   A strong finish helped Malawian burley growers sell substantially more tobacco by the end of this year’s market than the year before. Through the market close on August 4, 120 million kilograms of tobacco had sold for US$282.6 million, according to the Malawian Tobacco Commission (TC), compared to $182 million on sales of 85 million kilograms in 2022. A TC spokesman said that better weather was one reason for the increased output and good quality. “The average price increased from $2.14/kg in 2022 to $2.35/kg this year.”…Prices were high throughout the season, he said. “[But the sales were] even more exciting towards the end of the season when buyers offered record prices.”

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IDALIA DOES A NUMBER ON GEORGIA TOBACCO

 

A Georgia tobacco field after Idalia blew through. Photo: Josh Dawson, Lowndes County, Extension agent. A crop report for September 1 FLUE-CURED GEORGIA-FLORIDA It was a situation Georgians don’t like to even think about: A hurricane coming in before Labor Day on a tobacco crop that was late already. The result, says J. Michael Moore, Georgia-Florida Extension tobacco specialist: Tobacco in Georgia and Florida took a savage pounding from Hurricane Idalia, and growers will lose substantially in terms of fewer leaves to harvest, interruptions in curing power and worst of all, potential loss of quality in the leaf that managed to stay on the stalk. “Growers who had good crops with significant leaf still in the field will see declines in their yield and quality in the next few days,” he says. He doesn’t have an estimate yet on total losses in the two states. SOUTH CAROLINA Idalia passed through South Carolina. But its effect on the state’s tobacco could be described as a “near miss.” First off, much of the crop had been harvested. At the time of the hurricane, harvest in South Carolina was 75 to 80 percent complete, says William Hardee, S.C. Extension tobacco specialist. “We got a lot of rain from the storm, four to 12 inches depending on where you were.” Marion and Horry Counties seemed to have had the most. “ There will be some drowned tobacco in the low areas. “ Wind didn’t seem to be much of an issue. “I noticed where I was that most of the wind activity was up in the trees rather than down at ground level. But with the weaker storms, it usually takes a day or two to really see if we are getting that quick ripening response in the plant. ” There was a loss of power in some areas, but the outage only lasted a few hours,” he says. Tropical storms are never a good thing for a tobacco crop, “but growers came out as good as you could hope for." Overall, this season has been a mixed bag with the weather, says Hardee. "It depended on where you are in the state and the timing/amount of rainfall received. I think we generally have a crop of decent yield and quality, but some areas have certainly fared better than others.” NORTH CAROLINA Tar Heel tobacco growers benefited from a lot of luck when Idalia came though. It rained on a number of areas in N.C. but tobacco wasn’t major in any of them. "We missed Hurricane Idalia big time," says Matthew Vann, N.C. Extension tobacco specialist. "The rain was the main thing with us, and we were glad to have it." Carolinians are well along in harvest." I have heard that a number of growers are stripping their crop already. I would guess that we are over half finished by now." Growers gave been lucky in the field too. "We haven't had any out-of-the-ordinary disease or insect problems. This has been as good a year for disease and insect management as we have had in years." VIRGINIA In Charlotte County in south central Virginia, certain areas have been dry. But the county got some needed rain this past week, says Joanne Jones, county Extension agent. Burley harvest has just gotten started, while flue-cured and fire-cured harvest is well along…Connecticut broadleaf leaves are thin, and the weight will be down. There are two or three growers, and they made a point of cutting and spearing the stalks, then getting it quickly on a scaffold wagon so that it never let it touch the ground…Charlotte County produces a wide range of tobacco. Ranked by acreage: Flue 437; Burley 70; Dark fired 10.2; Cigar 13.5; Dark air-cured 8; Maryland 8. BURLEY TENNESSEE A strong market for burley in a few months appears to be in the offing, says Daniel Green, chief executive officer of the Burley Stabilization Corporation (BSC) in Springfield, Tn. “That’s because there is a worldwide shortage of burley due to bad weather that lowered production in some of the other burley-producing countries. Additionally, the number of farmers willing to grow burley is declining [in light of] strong profitability from alternative crops.” By Green’s calculation, demand for this crop will be around 70 million pounds. He thinks American farmers won’t deliver more than 50 million pounds. BSC raised its contract price this year to nearly $2.50 a pound. That seems likely to wind up looking like a stroke of genius if the supply falls this short of demand. “We have seen some of our old export customers who had gone away coming back to us,” says Green. One factor in our favor: South American burley is much more expensive than a few years ago. KENTUCKY Burley is well into harvest. “We are probably close to 50 percent harvested and in the barn,” says Bob Pearce, Kentucky Extension tobacco specialist. “Most of the crop looks good but there has been too much rain and wind in some places. We did have heat and high humidity in some areas last week. Pearce says there is little cured leaf, so quality can’t be judged, but he believes that it will be good. There has been none of the angular leafspot that plagues dark tobacco in the Black Patch, largely because burley is not nearly as susceptible to the disease as dark. There has been a little black shank and a lot of tomato spotted wilt virus. But the spotted wilt, though widespread, is not severe, says Pearce. “All in all, we have a definite potential of a good crop.” DARK & WRAPPER BLACK PATCH There’s been an awful lot of angular leafspot on dark tobacco in Western Kentucky and north Central Tennessee in the last month. “We had a disaster because of this disease in 2016,” says Andy Bailey, Kentucky-Tennessee Extension dark specialist. “This does not quite rise to that level, but it is the worst since then.” He says it is worst on the earlier set dark fired crops--in May--while tobacco set in June—the later crop—hasn’t been hurt as much.” Angular leafspot is a bacterial disease that usually appears only after severe weather. That is certainly what happened here: The westernmost part of the production area received 7.5 to 12 inches of rain on July 19, then more frequent rains through mid-August. “Probably 25 percent of our dark fire cured crop and some of our dark air-cured was severely damaged by the water, mostly by drowning, from the July 19 rainfall. Angular leaf spot may have damaged another 25 percent of the dark crop since then.  Some of this crop will never get harvested.”

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