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View Full Version : "U.S. Farmers Rediscover Tobacco" - end of subsidies = profit for small farmers




Spirit of '76
09-18-2007, 06:30 PM
CARMI, Ill. -- Tobacco is back in the American farm belt.

Three years after the federal government stopped subsidizing it, the leafy crop is gaining new popularity among U.S. farmers. Cheaper U.S. tobacco has become competitive as an export, and China, Russia and Mexico, where cigarette sales continue to grow, are eager to buy. Since 2005, U.S. tobacco acreage has risen 20%. Fields are now filled with it in places like southern Illinois, which hasn't grown any substantial amounts since the end of World War I.

For decades, Martin Ray Barbre, who farms the lush rolling hills here, was not eligible for federal price supports to grow tobacco under a program dating back to the Depression, making it economically infeasible for him to do so. The same was true for many farmers in 33 other states. Now the tarry plant is the most profitable crop Mr. Barbre grows on his 4,200-acre spread.

"If somebody told me seven or eight years ago that I'd be growing tobacco today, I'd say they were crazy," said the gruff, 52-year-old farmer, plucking a yellowing leaf from one of his plants and taking a deep smell of the raw, woody aroma.

As laborers from Mexico and Honduras used axes to chop down 6-foot plants and hang them on wooden planks to dry in the sun, Mr. Barbre explained the attraction of the crop. Even factoring in higher labor and other costs, he's netting up to $1,800 an acre from his 150 acres of tobacco, compared with $250 an acre from his corn. He credits tobacco with boosting his annual income by about 35% since he started planting the crop three years ago.

Although corn is flirting with near-record prices at around $4 a bushel, "there's no way corn can get high enough" to compete with tobacco, says Mr. Barbre, shaking his head. "There's just too much money in tobacco."

Mr. Barbre's profitable tobacco business adds a wrinkle to the debate over the farm bill Congress is preparing to take up. Many farmers say that without the system of subsidies for commodities like corn, cotton and soybeans, they'd be at risk of going under. But critics say the system fosters inefficiency, distorts international trade and supports mainly the wealthiest farmers. Now these critics can point to tobacco as evidence that subsidies are unnecessary.
read the rest @ http://online.wsj.com/article_email/SB119007308765730494-lMyQjAxMDE3OTEwODAxNzgzWj.html

Dustancostine
09-18-2007, 06:33 PM
As laborers from Mexico and Honduras used axes to chop down 6-foot plants and hang them on wooden planks to dry in the sun, Mr. Barbre explained the attraction of the crop.



Maybe this is why he is making money.

Manible
09-18-2007, 06:35 PM
We need food. Sure the luxury of tobacco is more expensive, but at some point the money won't matter because the price of food will be so high that millions will starve. The fluctuation of the wheat crop last year send the overall cost of food soaring.

Spirit of '76
09-18-2007, 06:50 PM
Maybe this is why he is making money.

Yeah, I caught that too. There's video with the article, and the Mexicans are all over the video. I doubt they'd be doing that if they were illegals.

Still, I'd rather see American high school kids doing this work, but good luck pulling them away from their playstations and getting them out in the fields working what is one of the most labor-intensive crops around.


We need food. Sure the luxury of tobacco is more expensive, but at some point the money won't matter because the price of food will be so high that millions will starve. The fluctuation of the wheat crop last year send the overall cost of food soaring.

The point is that agricultural subsidies reduce the incentives for small farmers to plant crops, and they allow the big ag conglomerates to control the market. Anyway, it's not an either/or proposition. I'm all for more tobacco growth in the US, especially among independent farmers and especially for the export market to China.

"If you can't send money, send tobacco."

--General George Washington, writing to the Continental Congress on behalf of his troops

Dustancostine
09-18-2007, 06:51 PM
Oh I agree that we need to get rid of subsidies and that it would have a positive effect for the small farmer. I just thought it was funny that he was using immigrant labor.

Manible
09-18-2007, 07:01 PM
Yeah, I caught that too. There's video with the article, and the Mexicans are all over the video. I doubt they'd be doing that if they were illegals.

Still, I'd rather see American high school kids doing this work, but good luck pulling them away from their playstations and getting them out in the fields working what is one of the most labor-intensive crops around.



The point is that agricultural subsidies reduce the incentives for small farmers to plant crops, and they allow the big ag conglomerates to control the market. Anyway, it's not an either/or proposition. I'm all for more tobacco growth in the US, especially among independent farmers and especially for the export market to China.

"If you can't send money, send tobacco."

--General George Washington, writing to the Continental Congress on behalf of his troops

Haha, yeah, I can't argue with that. BUT, susidizing corn wasn't meant to make it more profitable, it was meant to make it more available so that people can afford to have corn.

Spirit of '76
09-18-2007, 07:36 PM
True enough.

Of course, the rise of ethanol (and its attendant subsidies) has raised the price of corn so much that there have been tortilla riots in Central America! :eek:

trispear
09-18-2007, 08:27 PM
Ethanol -- another bullshit feel-good measure forced upon us by politicians. 15% ethanol in your gas drastically reduces your MPG canceling out any pollution benefit by forcing you to BURN MORE gas for the same miles. Not only do you burn more gas, you have to pay more per gallon when ethanol is in it.

From all the work to harvest ethanol, they get 1.3x the energy out that they put in it. A favorable estimate by the way. In South America they use sugar cane where the energy out vs energy in is 8x.

I just understand why we are using corn at all.

Spirit of '76
09-18-2007, 09:37 PM
Lobbyists.

It's interesting the way this is shaping up, though. The ethanol (ie. corn) lobby is duking it out pretty heavily with the livestock and dairy lobby.

http://www.businessweek.com/ap/financialnews/D8RKQIU80.htm