Tobacco Auction Canceled Tuesday At Co-Op Warehouse

Source from:  The Greeneville Sun 11-21-2005  11/22/2005

The tobacco auction that was previously announced for the Co-Op Tobacco Warehouse for Tuesday, Nov. 22, has been canceled, said Charlie Finch, of Knoxville, managing director of the Burley Stabilization Corporation (BSC). "There just isn't enough tobacco," Finch said. A second auction, which had been planned for Nov. 29, will also probably be canceled for lack of tobacco, Finch said. Ben Thompson, of Afton, one of the East Tennessee directors on the BSC board, said that at least one auction will be attempted before Christmas in order to give local tobacco growers an alternative market to selling directly to tobacco companies. "I think BSC is committed to at least one auction before the holidays, but we just don't know what is out there and how this thing is going to shake out," Thompson said. If enough tobacco comes in to the Co-Op Warehouse and if all the other details can be worked out, Thompson said, then the likely sale date before Christmas will be Dec. 13. "The percentage of growers selling or contracting privately with tobacco companies is probably 99.9 percent," Thompson said, "but the auction, as it was planned last spring, is an alternative for those growers who might not have signed a contract for whatever reason." In announcing the auction alternative last spring, Finch said, the long-term goal is to allow auction markets to survive the post-buyout transition and to develop a solid business model that will allow the auction sales to serve a vital role in ensuring the competitiveness of American burley tobacco. "But the one thing we really need to emphasize is the fact that this is just a marketplace for growers to sell their tobacco. There will be no price guarantees or price supports from now on," Finch said. Price Supports Have Ended Price supports ended last year with what is most commonly known as "the buyout," a federal program that is compensating growers to lessen their dependence on the crop because of the dramatic downtown in the tobacco industry. All the changes have left growers with more uncertainty than they have ever faced, Thompson said. "Nobody knows anything," he said. "We are all left with a day-to-day way of doing business." The BSC is staging non-contract warehouse auction sales in other cities across its service area, Finch said, including Asheville, N.C., and Abingdon, Va. The BSC is the farmer-owned cooperative that administered the old price support system on the crop under contract with the U.S. Department of Agriculture. "We are still in business to continue to serve the interests of the tobacco growers in our region," Finch said. But Finch and others continue to stress to growers and everyone else that there will be no price supports on tobacco from now on. Growers needing a non-contract alternative to market their tobacco between now and Christmas should plan on selling Dec. 13 at the Co-Op Tobacco Warehouse, Thompson said. Enditem