Growers' Cooperative Gets Ready To Enter New Tobacco Market
Posted June 15, 2004 11:25 a.m. EDT
ROXBORO, N.C. — Congress is considering a $10 billion tobacco buyout. The plan just passed a big hurdle in a House committee.
At the same time, a growers' cooperative is getting ready for a new tobacco market. It is buying a cigarette plant, hoping to bring new security to farmers.
Workers are shaking out the old and getting ready for the new at the Vector Tobacco Plant in Roxboro. At one time, 150 employees processed genetically modified tobacco for a low or no-nicotine brand.
Flue-Cured Tobacco Cooperative Stabilization Corporation
is buying the plant and plans to re-hire several of the old workers.
For 50 years, the farmers' cooperative administered the price-support program. That role would end if and when Congress approves a tobacco buyout bill. So the corporation has been looking for other ways to serve their members.
"It's a win-win as far as I'm concerned," said Durham County tobacco grower Talmadge Layton.
Layton said he likes the idea of a new premium cigarette that contains more American tobacco than any other brand.
"Get some publicity for American tobacco," he said, "and allow us to continue to raise tobacco -- maybe even a little more than we're raising now."
But there are many hurdles ahead.
"It's pretty easy to get cigarettes made, and it's not that expensive to get cigarettes made," said Lionel Edwards, general manager of the stabilization corporation. "But selling them is the big problem."
The new cigarette's success will depend on competitive pricing with established brands and word-of-mouth marketing.
The corporation also will sell the processed tobacco to overseas markets. It is a new way of doing business that many farmers hope will keep them in business.
Once the purchase is complete, Vector will become the U.S. Flue-Cured Tobacco Company.