WNC Tobacco Auctions Open Despite Changes

Source from:  by John Boyle, SENIOR WRITER published November 28, 2005 6:00 am 11/29/2005

Burley growers return after end of price supports Asheville has been home to burley tobacco auction warehouses for more than a century. But with the upheaval in the industry caused by last year's $10.1 billion buyout of tobacco producers, the tradition looked like it might end. For people like Yancey County grower Wendell Wilson, that would've truly been the end of an era. "I'm 44 and I started coming down here when I was 7 years old," Wilson said Tuesday after he dropped off his harvest of pungent burley leaf at the Dixie Big Burley Tobacco Warehouse. "I'm tickled to death the Owen family kept it open. I wouldn't think of going anywhere else as long as the Owen family keeps this going." Marty Owen, whose family has run the Dixie Big Burley Warehouse since the early 1960s, opened the auction market last Monday. It will run through Dec. 15, providing the only local auction market in Western North Carolina. Four tobacco companies came out for the first-day sale, buying about 170,000 pounds of leaf — about half of last year's first-day sales. The average price was $1.56 a pound, considerably less than last year's average, which hovered around $2. "It always needs to bring more, but we averaged more than I thought we would," Owen said. Growing burley tobacco is a tradition in Western North Carolina dating back to the earliest settlers in the late 1700s. Commercially, it's been a staple crop for more than a hundred years and sold in Asheville auction houses since the late 1870s. The 11 westernmost counties of North Carolina had about 3,500 tobacco growers in 2004. Just at the Asheville warehouses, sales traditionally generate between $8 million and $10 million annually. In previous years, farmers were guaranteed a base price, which usually hovered around $2 a pound. But last year the buyout went through, giving producers a lump-sum payout for their quotas, or the amount in pounds the government would allow them to grow. In exchange, farmers gave up a price support system that was in place since 1938. But farmers also have fewer production expenses now that the federal quota system has ended and they no longer have to pay other producers to "lease" pounds from their quotas so they could grow more leaf. "I put in about two and a half acres this year," said Wilson, who works a full-time job as a production manager at a textile mill. "Usually, we put in about 11 acres, but I kind of wanted to see how much it would bring this year." Planters Tobacco Warehouse, which opened 16 years ago, also will be hosting tobacco auctions. This past season, Planters and Dixie sold a total of 4.2 million pounds of tobacco — $8.1 million worth. Some local growers have opted to contract directly with tobacco companies. The N.C. Rural Economic Development Center Inc., and the Burley Stabilization Corp. covering Tennessee, North Carolina and Virginia, provided funding to help keep the Asheville auction houses open. Worldwide demand for burley tobacco, which comprises about one-third of a typical cigarette and is prized for its ability to absorb flavorings, remains strong and production has been short in recent seasons, Owen said. But more growers in North Carolina's Piedmont are taking up the crop, traditionally grown primarily in the mountains, so competition is intense. But mountain growers want to keep producing the crop, which has put many a child through college and put food on the table for generations. "We want to stay part of the tobacco chain as long as it's profitable," Wilson said. Enditem