About the Industry
The tobacco production industry has witnessed a number of dramatic changes and challenges over the last several years. In the mid to late 90’s tobacco growers began to see the downside to the relatively high price stability and increased asset values due to the price supports provided by the federal tobacco program put in place to manage supply and stabilize prices. Marketing quotas were reduced over time and the quality difference between domestic-grown and foreign-grown tobacco leaves narrowed and consequently cigarette manufacturers began to use lower-cost foreign-grown rather than domestic-grown leaf. Domestic tobacco growers began having difficulty maintaining their competitive edge in the presence of the federal tobacco program under which quota rental and lease costs were accounting for an increasing portion of production costs.
These trends prompted the development and passage of the Fair and Equitable Tobacco Reform Act (FETRA), most commonly known as the “tobacco quota buyout”. FETRA was signed into law on October 22, 2004 as part of the American Jobs Creation Act of 2004. This legislation deregulated the tobacco industry and completely changed the way tobacco is produced and sold in the U.S. by eliminating the over 65-year old federal tobacco program.
Once again, the tobacco industry faces another policy change with the passage of the Family Smoking Prevention and Tobacco Control Act, H.R. 1256, which was signed into law on June 22, 2009. This legislation grants FDA new authority to regulate the manufacturing, marketing, and distribution of tobacco products to protect the public health and to reduce tobacco use by minors. There are several implications and possible impacts for tobacco growers, even though the regulation is directed toward tobacco product manufacturers.
About the Plant
Tobacco plants are started with very small seeds planted in trays and cultivated in either greenhouses or well-managed plant beds. Once the plants reach maturity in the greenhouse or plant beds they are transplanted to the field. The plant will be “topped” to encourage the nutrients the plant absorbs to go towards the leaves and stalk of the plant, rather than towards the flower, which has little economic value. This process allows for larger and heavier plants. After the plant has been topped it will be harvested for its leaves, which are used in tobacco products such as cigarettes, snuff, cigars, and chewing tobacco. The majority of tobacco leaves are cured with one of the three following methods: (1) air-curing, (2) flue-curing, or (3) fire-curing. Each of these methods reduces the moisture content and enhances the color and aroma of the tobacco as needed by the particular tobacco products they will be used in. The characteristics of the leaves, harvest, and curing method distinguish tobacco into different types. In the U.S. the most common tobacco types include burley, flue-cured, dark air, dark-fired, cigar, and Maryland.
Burley tobacco is a light air-cured tobacco used primarily for cigarette production, specifically in the majority of blended cigarettes commonly referred to as “American” blends. Burley has broad leaves, which are harvested on the stalk by hand and placed on a stick for handling. Burley is cured hanging in structures with a roof, but with either open sides or vents to allow air to freely circulate. No additional heat is added and tobacco is allowed to cure naturally over four to eight weeks. After the curing processes, it has a light brown to reddish brown color.
In the United States burley tobacco is produced primarily in eight states, with Kentucky producing approximately 70 percent of the crop. Tennessee is second with about 12 percent of US burley production. The remaing produciton is grown in Indiana, North Carolina, Missouri, Ohio, Virginia and West Virginia.
Flue-cured tobacco is also primarily used for cigarettes. The name "flue-cured" was developed from the method of curing where heat was distributed throughout the curing barn by metal pipes or "flues." Flue-cured tobacco can be either harvested by machine or by hand, with mechanical harvesting being the most widely-used method. Harvesting for flue-cured tobacco begins at approximately the same time as topping. The leaves are harvested separately by stalk position, starting with the lower leaves and progressing up the stalk. After harvesting, the leaves are placed in metal racks or boxes that hold the leaves in place during curing. The racks or boxes of tobacco are placed in the curing barns where heated air is forced through the tobacco to develop an orange or yellow color, and then to dry the leaves and stems to remove moisture. Ventilation is also a part of the curing process and is varied as needed to remove moisture while retaining quality of the tobacco.
Flue-cured tobacco is primarily grown in North Carolina, Georgia, South Carolina, Virginia, and Florida. North Carolina produces over 75 percent of the crop, while Georgia, South Carolina, and Virginia each produce about 8 percent of the US flue-cured production.
Dark air and dark-fired tobacco is primarily used for chewing, snuff, cigar, and pipe blends. The plant produces heavier and larger leaves, which are harvested on the stalk, but allowed to wilt before being placed on the stick. Mature leaves will be thick with a leathery texture and possess a somewhat oily sheen.
Dark air tobacco is cured essentially the same as burley, hanging in structures with a roof, but with either open sides or vents to allow air to freely circulate. However, due to the heavier body of dark tobacco, it may be necessary to use some type of heat to assist in the curing process.
Dark-fired tobacco is fire-cured, which means wood smoke from a burning fire is used to dry the leaves. Dark-fired tobacco is stalk-cured in a totally enclosed structure, with vents that can be opened when needed. Small, controlled fires are built on the floor of the barn using sawdust and hardwood slabs, and the leaves cure in the smoke-filled barn. This process adds a smoky flavor and aroma to the tobacco, which is desired for some smokeless tobacco products. The firing process is more of an art than a science and requires experience and skill to prevent ruining the tobacco.
Dark tobacco is grown primarily in small regions of Virginia, Kentucky, and Tennessee, with the regions within Kentucky and Tennessee producing over 90 percent of the US dark tobacco production.
Cigar tobacco is also referred to as “shade tobacco”, as is it commonly shaded under tents or canopies that protect the plant’s delicate leaf. Cigar tobacco is hand primed at harvest and cured in barns typically with a source of heat, such as propane heaters. Cigar tobacco is characterized by plant type and the functions of individual leaves in the final product: filler, binder, and wrapper. The filler is used as the core of the cigar. The binder is wrapped around the filler to give shape to the cigar and cigar wrappers are used for the outside cover of cigars. The economic value of wrapper tobacco is dependent on the integrity of the leaves; a single tear or blemish can reduce its value. As a result, this form of tobacco is extremely labor- intensive, with nearly all stages of production, cultivation, curing, and packing carried out by hand.
Cigar binder is mostly produced in Connecticut, Massachusetts, and Wisconsin. The cigar filler is mostly produced in Pennsylvania, Ohio and Puerto Rico.
Maryland tobacco is used in American blended cigarettes, but primarily in certain Swiss cigarette blends. It is light air-cured tobacco, named after the State of Maryland where it used to be grown in abundance prior to the 2004 tobacco buyout. Maryland tobacco is similar to burley as it harvested on the stalk and is cured by the same air-cured, roofed barn method as burley tobacco. This tobacco has upright and large leaf like burley, but it is darker green color without the creamy mid-veins. After curing, the leaf is various shades of brown.
Maryland tobacco production is mainly in five Maryland counties around Washington, D. C. and in Pennsylvania.
The federal tobacco program was passed in 1938 as a part of the Agricultural Adjustment Act of 1938. Under the old federal tobacco program, government issued quotas were attached to land that limited the amount of tobacco that could be marketed each year. Basically, quota holders agreed to limit the amount of tobacco marketed in exchange for price support. The program was funded by assessments paid by producers and companies according to the number of pounds marketed and purchased. The United States Department of Agriculture (USDA) was responsible for administering the program.
Center for Tobacco Grower Research
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