Decision on Tobacco Quotas Has Farmers Worried
Posted December 2, 1997
RALEIGH — There's yet another threat to an industry that helps form the backbone of North Carolina's economy. A decision on next year's tobacco quotas could mean a lot less money for farmers, and there'sa growing movement to abolish quotas altogether.
Tobacco farmer Denny Lee worries about the upcoming tobacco season, after getting word that production quotas may drop by 20 percent.
Tobacco quotas were established after the depression of the 1930's as a means to control prices. They just needed a safety net
Each farm is assigned a quota based on how much it has historically produced. Each year the government determines how much domestic tobacco can be grown without a big price drop. That either brings an increase or a decrease in a farmer's quota.
This coming year, quotas will go down because of an oversupply of leaf from last year, and lower demand from cigarette manufacturers in light of the recent tobacco settlement.
Lionel Edwards represents the Tobacco Stabilization Corporation. He says the anti-tobacco sentiment in this country is hurting the industry.
One way to ease situation for tobacco farmers, according to Lee, would be for the federal government to actually buy them out of the tobacco quota system
The idea, proposed in Washington last year, would give each tobacco farmer a lump sum to compensate for the end of price supports. It would also help farmers who have spent money on the purchase of tobacco quotas from other farmers no longer using theirs.
Price quotas are already being phased out for other crops, including cotton and peanuts.