FARM SCENE: Wisconsin Farmers Testing Burley Tobacco

Source from:  COLIN FLY Associated Press STOUGHTON, Wis. 08/22/2006

David Olson peers over his raspberry patch at a 16-acre plot of tobacco on his southern Wisconsin farm and sees a healthy crop ready for harvest in a few weeks. Even bigger yields could be on the way thanks to expanded opportunities to farmers in Wisconsin from companies like Philip Morris. Olson, who has farmed tobacco since 1973, grows a type of Wisconsin tobacco for Swedish Match Tobacco Leaf Co. used for chewing, but he and other local farmers have started tinkering with growing burley, the primary type of tobacco in cigarettes. "It could be an opportunity for some people to make money," he said. "But they're so used to raising Wisconsin tobacco, it's a change for them." Wisconsin might just be the place after farmers nationwide significantly cut back growing burley when Congress passed the $10.1 billion tobacco buyout in 2004. That ended the industry's Depression-era production and price controls, and replaced them with a free-market system, allowing farmers like Olson to grow new tobacco. There's nothing new about tobacco's place in Wisconsin's history. About 15 miles down the road, Edgerton, with about 5,000 residents, was once known as the "Tobacco Capital of the World" and boasted more than 50 tobacco warehouses that lined the main streets and railroad tracks. The city's former train depot holds the chamber of commerce, which overlooks one of the many cream-brick warehouses still standing from the 1880s. The poignant reminders of the city's history with the crop also remain with painted advertisements for brands of chewing tobacco. There are factors in local farmers' favor in Wisconsin again, even though tobacco only accounts for 0.1 percent of the more than $5.6 billion agriculture industry in Wisconsin, according to the National Agricultural Statistics Service. Initial testing from tobacco companies has found that types of tobacco grown in Wisconsin have low amounts of nitrosamine, a precursor to cancer-causing carcinogens, said David Fischer, University of Wisconsin Extension's Dane County crops and soils agent. That could translate to the burley crop, and the climate of longer, cooler sunny days in the summer also bodes well for the plant. "The real opportunity here is to diversify the tobacco production in Wisconsin," Fischer said. It's also attracted the U.S.' biggest cigarette manufacturer, Philip Morris. The company won't disclose exactly how many acres of burley are being tested in Wisconsin or how much it is investing in the effort, but at least four counties are involved. "We think the climate and soil conditions may be beneficial for growing burley," Philip Morris spokesman Bill Phelps said. "One of the benefits is looking to ensure we have a stable supply of burley tobacco. Now that tobacco growing has moved to this free market system, the market is evolving. We want to evolve with it." With less than 2,000 acres of two types of Wisconsin tobacco grown across the state, any burley would be a niche market in Wisconsin. Kentucky leads the nation in burley production, with about 106,000 acres harvested in 2004, according to the agricultural statistics service. But that isn't stopping farmers like Ed Farrington, who is growing 2 1/2 acres of burley this year for Philip Morris along with more than 24 acres of Wisconsin tobacco. He hopes to grow more burley next season. "The demand for regular Wisconsin tobacco growing around here has been falling every year," said Farrington, who works with two cousins on a 1,900-acre farm just south of Edgerton. "This is just a way for people who want to still raise tobacco, this is another market for them." Olson, 53, tested burley last year, and said the rich brown leaves are exactly what tobacco companies like Philip Morris want. "They like to go with people who know how to raise tobacco," Olson said. "Philip Morris is putting a lot of money into this and they are hoping it goes well." Phelps said the company has been pleased with returns from other states. "We contract with thousands of burley growers each year and we're looking in new and expanded areas," he said. "In Maryland and Pennsylvania last year, we were so pleased with the quality of that tobacco, we expanded our plans this year." Fischer said while the initial amount of tobacco grown in Wisconsin will be small, there could be opportunities to quickly expand. "If it performs as they expect and they hope, I suspect they'll be recruiting heavily for growers in the state of Wisconsin," he said. And growers would be in line for some hefty profits. An acre of burley tobacco is worth about $4,800 before expenses, much higher than the $400 an acre of corn can fetch. "There's more income per acre," Farrington said. "But it's much more labor intensive." Still, extra labor for extra profits is too good to pass up, as long as farmers secure a contract from a tobacco company. But growth isn't a sure thing either. There have been discoveries of blue mold, a devastating fungus that could severely damage long-term prospects by eating through the crop. Tobacco grows best in damp conditions when temperatures range in the 70s during the days and 50s at night, according to agricultural agents. Even with the potential problems, tobacco is a chance Olson and Farrington see as worth taking. Olson envisions many farmers in Wisconsin with up to 50-acre plots of burley. "It's so expensive for young farmers to get in the business," Olson said. "Maybe for some of these younger guys, they'll have something new they can do." Enditem