`Hostages' Rally in Tobacco Belt

Source from:  Jan 17, 2008 Pat Currie Special to The Star TILLSONBURG, Ont. 01/18/2008

Protesters gather tonight to demand $1B exit plan for last few debt-ridden growers in dying industry Organizers expect 1,000 people, including many of Ontario's remaining tobacco farmers, to gather at a rally tonight in this tobacco-belt town to demand a $1 billion "total exit plan" to get the last of the province's producers off the tobacco habit and into growing alternative crops. The buyout package would amount to mere "peanuts" compared to the $9 billion the tobacco sector pours into government tax coffers annually, rally organizer John Van Daele said. That will bring a merciful end to the 15-year-long death agonies of Ontario's two-century-old commercial tobacco industry, and allow growers, many deep in debt, to escape with more than the shirts on their backs. The golden leaf that once fuelled the economy across the Tobacco Belt is withering away, taking with it the wealth that built the grand homes, churches and arenas of southwestern Ontario. Production that topped 285 million pounds of tobacco in 1983 will fall to 29 million pounds this year. Of 1,559 quota holders in Ontario, only 600 are active – half the total in 1991 – and they're all aging and hurting. "The number of bankruptcies and suicides is scary," former Norfolk tobacco grower Bob Peroracki told the Brantford Expositor nine months ago. "The Imperial Tobacco plant in Aylmer used to employee 800. In 1985, it was one of five processing plants in this area. Two years ago, Imperial shut it down and moved production to Mexico. Now there is only one plant left in Ontario," said Van Daele, who struggles to pay bills on a shrinking tobacco crop near Tillsonburg. "There used to be four car dealerships in Delhi. Now there aren't any – it's like a ghost town," he said. "We want a total exit plan. Tobacco is dying. It's hopeless," said Van Daele, who is also president of the Oxford-Norfolk-Elgin Landowners Association, organizer of tonight's meeting. Every Ontario tobacco quota holder, representatives of their marketing board, government and farm-support industries has been invited to demand adequate compensation to allow growers to shift to alternative crops before they are "driven under," Van Daele said. Ontario's surviving tobacco growers are caught in an iron squeeze between what they see as indifferent and even hostile governments and the collapse of their one-company market, Imperial Tobacco. Imperial and other big Canadian tobacco companies have shifted to imported tobacco and relentlessly slashed production quotas and prices for Ontario growers. Meanwhile, government tax policies have fostered a $1 billion underground industry, centred on the Six Nations reserve near Brantford, where 200 shops sell tax-free cigarettes and 200 people make more to supply reserves across Canada, said former tobacco grower Hugh Zimmer of nearby Otterville. "For years, we have been providing the governments with $9 billion a year in tax revenue. I personally generated $25 million a year. In comparison, the amount we want to finance a complete exit plan is peanuts," Van Daele said. In return, "our own provincial government declared war on us," Van Daele said, echoing the words of a recent press release by the Ontario Flue-Cured Tobacco Growers Marketing Board. The board said Ontario government policies have contributed to a 63 per cent decline in Ontario tobacco production. Farmers will be allowed this year to grow less than 10 per cent of their quota limits. Another 30-cent-per-pound price cut has reduced tobacco prices to less than the $2.80 per pound many farmers originally paid for their quotas, Van Daele said, adding that "doesn't even come close" to covering higher production costs, especially for fuel and fertilizer, and allow a decent return. He said the producers are even further embittered because they were forced several years ago to invest heavily in expensive new equipment or lose their quotas. "Now the new equipment we bought is worthless – nobody will buy it – and we're saddled with debts of a million or a half million (dollars) with no way to pay," Van Daele said. For its part, the federal government signed the World Health Organization's Framework Convention on Tobacco Control – the main goal of the treaty being to reduce smoking worldwide. The treaty also identified the need for adequate "adjustment assistance" for growers, but, in contrast to the United States and Australia "which forced the tobacco companies to pay," the Canadian government has not provided one cent in compensation, said Zimmer. "The tobacco farmers are trapped; they're economic hostages," Zimmer said. Zimmer was one of about 250 tobacco growers who got out of growing tobacco five years ago. He said they're still waiting for "a fair share" of a $50 million compensation plan announced by the Ontario government about five years ago. "They only gave growers $35 million. The other $15 million they spent on a crazy alternative crops scheme," he said. Enditem