Buyout represents bittersweet ending

Outside the Brightleaf-Riverside Tobacco Warehouse, the aroma of tobacco hangs heavy in the air. Inside, the bittersweet words of tobacco farmers are just as heavy as the reality of the buyout begins to sink in.

Only two days after the Senate passed the buyout, the reality of what it means to be in a new era hit tobacco farmers in flue-cured country, the most obvious place being the last day of auction 2004.

After years of working for a buyout — hoping for a buyout, watching as quota declined every year — growers finally have a buyout. There's the feeling of accomplishment and yet the feeling of, “What's next?”

Quota is gone; price support is gone. Buyout checks are a ways off. Growers contemplate a victory amid the uncertainties that it has brought.

“It's a bittersweet feeling right now,” says Bobby Jernigan of Sampson County, N.C. “It's definitely no big windfall.”

On one hand, the buyout will allow growers to retire with dignity or to continue production. On the other hand, growers such as Jernigan lament they will not be able to leave quota to their children. Next year, tobacco growers will be in a free market, pretty much like other foreign leaf producers.

All have watched quota decline to more than 50 percent of what it was in 1997. They were bracing for another 30-percent cut in quota had a buyout not passed.

The $10.1 billion buyout will infuse some $3.8 billion into the North Carolina economy alone. North Carolina is the largest producer of flue-cured tobacco in the country.

Reactions from different parts of the flue-cured belt about the buyout echo those found at Brightleaf-Riverside in Smithfield, N.C.

“Like every farmer who has taken time and let themselves absorb what has happened, I have mixed emotions,” says Keith Parrish, a Harnett County, N.C., producer and CEO of the National Tobacco Growers Association. “It's a time when every farmer is going to have to look at his individual operation and decide what his options are for the future. Those of us who do not have contracts have to go out and get contracts or go to Stabilization, quit or diversify.”

To Sam Crews, president of the Tobacco Growers Association of North Carolina, the buyout was a lifesaver.

“We were headed for utter devastation,” Crews says. “I'm ecstatic about it. I have some concerns about next year. But I feel like these companies are going to pay us a reasonable price so we can make a living.

“Right now, we're all kind of sitting on pins,” Crews says. “It's going to take a while for it all to shake out. We're enjoying the moment for a week or so and then we'll get to figuring.”

In Georgia, Lawton Matthews, chairman of the Georgia Tobacco Commission, has the same mixed emotions. “Everybody was really looking forward to the buyout, but now that it has happened, it changes a lot of the historical perspective and everything concerning production.”

Matthews had planned to exit production once the buyout was complete. He now says he'll look at the situation to see if he can get a “decent” contract. If so, “I may try for one more year.”

He sees growers in Georgia being cautious in the coming year, hesitating to go to the contract system fully. Acreage may increase in Georgia, Matthews says. “The companies say they need U.S. tobacco and growers know what it costs to grow it. I don't feel like the companies are going to try to skin us.” Matthews also is concerned about what effect the government's lawsuit against tobacco companies might have.

Leaning on a bale of tobacco at the final auction of the season in Smithfield, N.C., Cecil Stephenson of Coates, N.C., gives as honest an answer as any grower can when asked what it will mean to him: “I can't give you an answer because nobody knows. We don't know the outcome.

“It's kind of a sad way to go,” says Bob Nordan of Benson, N.C., reflecting on the history behind the auction system and the tobacco program.

Growers realize a buyout was needed, but more than a few think they may have come out on the short end of the stick.

Both Nordan, who grows 30 acres, and Stephenson, who grows 62 acres under contract with Philip Morris, were at the Flue-Cured Stabilization Marketing Center to sell what they grew over quota.

Growers interviewed at the auction seemed to realize that the end of the quota system would bring a new era.

“It's all in the hands of the tobacco companies now,” Jernigan says, as he and Kenny Ammons of Lewis Farms in Dunn, N.C., discuss the future. “It will all depend on the contracts and the price the companies are going to pay us for the tobacco.”

The growers interviewed at the tobacco warehouse said the relationship with Philip Morris is a good one. “If we grow what they want, then it's going to be good. But we don't always have a good growing season.”

Walking the aisles of tobacco at Brightleaf-Riverside, Stabilization General Manager Lionel Edwards believes farmers can produce tobacco that will be in demand. He says Stabilization plans to continue offering its marketing centers as an alternative to contracting.

For Keith Parrish, who spent much of the last year on almost-weekly treks to the halls of Congress lobbying for the buyout, it represents closure. “We know what we've done. It's just figuring out what it's going to mean. It's actually changing eras, so we will have to change the way we think.”

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