Burley prices up slightly at local warehouses

November 18, 2003|GARY MOYERS

Opening day burley tobacco prices in Danville and Harrodsburg were up slightly over last year's average despite the uncertain status of the federally-subsidized price support system.

Tommy Kirkpatrick of Farmer's Tobacco Warehouse, host of Monday's opening sales, said Danville's market sold 219,474 pounds for $432,395, an average price of $197.01 per hundredweight, up two cents over last year's prices. In Harrodsburg, 160,123 pounds of tobacco were sold for $316,545, an average price of $197.69, also up two cents over last year.

Statewide sales in seven markets in Kentucky were 1,657,532 pounds of leaf for $3,264,047, or an average of $196.92 per hundred pounds, up $1.44 from last year's opening day.

"It was kind of a mixed crop this year," said Kirkpatrick. "It always is during the first week. We had some of last year's tobacco held over, then we had some that was probably brought to market a little early to get the cash. Mixed in with that was some pretty good tobacco."


The direct contract tobacco at Burley Warehouse sold a little higher on the first day, going for an average of $200 per hundred pounds.

"Some of the tobacco that sold early was a little rough, but we got to some pretty good tobacco pretty soon and the price showed it," said Ansel Hogan of Burley Warehouse. "We had a Lincoln County farmer come in here and get an average of $202 for 20,000 pounds. That's a real good price."

Jerry Rankin, owner of Farmer's Tobacco Warehouse, said this year's growing season was an odd one for tobacco.

"We had a lot of rain in the spring, and a lot more rain in the summer than tobacco needs," he said. "We've got a lot of crops that have thin leaves with no weight on them, and that's going to keep the prices down some. But mixed in there is some pretty good tobacco, too."

Burley Warehouse contracts with Universal Tobacco Company, and growers sell directly to the buyer there, with no guarantee of a sale or of price supports.

The auction price this year was a little above the support price of $193 per hundredweight. Several sellers said they hoped for more than they received, but they expected what they got."I've sold three baskets and I've still got a couple left," said Pat Conder of Casey County.

"I got $194 for what I sold, and I'm hoping for better on the rest of it. But, it's pretty much generally the rule that you get just a little over what the support price is."

Monday's sales in Danville were followed in the afternoon by opening day sales in Harrodsburg at Freeman's Tobacco Warehouse. The two markets will be open on the same days, but will alternate mornings and afternoons.

Sonny Curtsinger of Harrodsburg was still hopeful as he waited for his tobacco to sell. "I've sold some of mine and got $193 so far," he said. "I'm hoping it'll get a little better, but it's probably going to be around that for all of it. You always hope for more than you get."

Much of the talk centered around proposed federal legislation

Much of the talk around the pallets of tobacco by farmers and buyers alike centered on proposed federal legislation that would buy out the tobacco subsidies from farmers. Legislation was introduced in the House by Rep. Ron Lewis (R-Ky.) and Senate by Sen. Mitch McConnell (R-Ky.) last month to end the program, established in 1938, that is the last remaining operational program from President Franklin Roosevelt's New Deal.

"It's created a lot of uncertainty among all of us," said Bob Peterson, a North Carolina buyer at the Danville sales. "Farmers don't know how much longer the program will exist the way it is, and buyers don't know what's going to happen either. This whole system may soon be gone."

Under the proposed legislation, farmers would be paid for their inherited, bought or leased tobacco quota base, and the price support system would be eliminated. Tobacco as an industry would then migrate to a true free market system, with growers negotiating their own sales. The sticking point to this point has been whether the tobacco industry would move under the regulatory control of the Food and Drug Administration.

Sales will continue in Danville and Harrodsburg for 13 days until the Christmas break, then resume next year.

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