USDA Cuts Tobacco Allotment 18.5 Percent

Wednesday afternoon, the USDA announced that farmers will be allowed to grow 18.5 percent less tobacco next season.

The latest cut will cost small tobacco farmers thousands of dollars and will cost large tobacco farmers tens of thousands.

Farmer Denny Lee said his once-thriving farm cannot take much more of it.

"In 1997, we had 470 acres. This past year with the cuts, we tended 300 acres. This year with the additional cut, we'll be down to about 250 or so acres," said Lee.

The quota system is in place to keep supply and demand in check. Too much tobacco means lower prices for everyone.

Even with the limits, cigarette companies are buying more overseas leaf for less money. The result is less demand for the leaf that built North Carolina.

"I cannot understand why our allotment has been cut almost 50 percent in the last two years, and consumption has not dropped but 4 percent. I don't understand why we are being traded off," said farmer Dale Lucas.

Even though tobacco farmers will make less money next year, their debt is the same. Most farmers owe money for tractors, homes and farm equipment, and the bills do not drop just because the profits do.

"We can't survive it. There is no way in the world we can survive it. We have to live. What they are trying to do is cut us out, and they are succeeding," said farmer Andre Richardson.

There is also another tax that the farmers will have to pay. Up until now, they have been paying one cent per pound as sort of a tax so that they could get paid at the warehouse each year. That has been raised to 2.5 cents per pound.

The cut could have been much deeper, but cigarette companies agreed to buy 65 million pounds in excess tobacco at a discount price after some last-minute negotiations.

This year's cut is the third large cut in three years. Farmers took an 18 percent cut last year and a 17 percent cut the year before that.