Maryville, Tenn., Tobacco Farmer May Take Government Buyout Plan

Source from:  The Knoxville News-Sentinel MARYVILLE, Tenn. 09/02/2004

Roy E. Scarbrough has witnessed a lot of changes in the business of raising tobacco, a vocation he's been engaged in since the early 1960s. This year's crop may be his last, the 64-year-old farmer says. A receding price-support system and importation of cheaper -- and lower-quality -- tobacco from other countries have steadily nibbled away at Scarbrough's profits. And legislation Congress is considering may make it attractive to simply exit gracefully from tobacco farming, which Scarbrough has been involved in since his 1963 graduation from the University of Tennessee. The 2004 tobacco crop was a good one, Scarbrough said Tuesday as he enjoyed an unseasonably cool August breeze in the shade of a maple tree in his Blount County yard. The tobacco plants are tall and broad, thanks to abundant rain during the summer growing season. As leaves began to yellow in the past week, the harvest began on Scarbrough's 4.5-acre tobacco allotment. But John Goddard, agricultural extension agent for Loudon County, believes tobacco production will be below average across the region. "We had too much rain early," Goddard said. The best tobacco is that that was put in late. It's not a bumper crop by any stretch of the imagination." Flooding damaged some crops, Goddard noted. In addition to tobacco, Scarbrough, a former Blount County commissioner, raises about 40 acres of soybeans plus hay and cattle on more than 400 acres he farms along U.S. Highway 411 South. Scarbrough's family has farmed the land since 1943, when the U.S. government appropriated their Anderson County homesteads to build the complex where America produced its first atomic weapons. Scarbrough's uncle relocated to a 150-acre tract on what was then a two-lane concrete road known as New Niles Ferry Highway. The road is now a broad, multilane highway and a major artery for tourism and commerce for Blount County. "One step from heaven" is how Scarbrough describes his Blount County homeland. Tobacco cutting began last weekend. The leaves will be left in the field two to three days, Scarbrough said, before being hung in his barn. Come mid-October, the tobacco will be ready for baling and hauling to a broker in Surgoinsville, Tenn., who has contracted to buy it. This year's harvest is "better than normal," Scarbrough said. The extra moisture this summer helped make it "grow uniformly, not in spurts." But the good crop may be Scarbrough's grand finale as a tobacco grower. A government buyout program for tobacco farmers is contained in legislation known as the American Jobs Creation Act of 2004, a bill primarily designed to make the United State compliant with an international trade treaty, according to Paul Denton, UT professor and extension burley tobacco specialist. U.S. tobacco prices are much higher than those of, say, Brazil, which Denton described as America's prime competition. He added, though, that there is a "big quality difference" between American and Brazilian tobacco. The export price of American tobacco is about $4 a pound, Denton said. But foreign tobacco can be imported for about $1.50 a pound. "Our price is quite high relative to the rest of the world," he said. "Demand has declined quite a bit in past years, and many farmers have really been squeezed." "Tobacco companies do still want American tobacco," Denton added, "for their premium brands. Plus, the production is more reliable." The buyout plan under consideration would pay tobacco quota owners and growers a set amount based on their past production. It would be a one-time payout and would "come from a user fee on tobacco products," Denton said. The quotas, born of the agricultural price-support system of the Great Depression era, would cease to exist. Among the differences being worked out in conference committee is the payout amount. The House version offers $7 a pound to quota owners and $3 a pound to growers. The Senate would offer $8 to quota owners and $4 to growers. Scarbrough is the quota owner on his crop, and Troy Cansler is the grower. An inherited nerve disorder prevents Scarbrough from active participation in the planting and harvesting of the tobacco on his land nowadays, so Cansler does the work and the two split the profit. But whether they can make that deal next year remains unknown. Enditem