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Can burley blossom in Shelby this summer?

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Shelby farmers see issues that could hinder growth plan

By Todd Martin

On Wednesday, the Burley Tobacco Growers Cooperative Association announced Steve Pratt as the new general manager for the company, and Pratt talked of big plans.

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He said in accepting the role that his goal to expand the number of grower contracts in the state, increasing Kentucky’s hold on the market it once dominated.

Although two of Shelby County’s top producers agreed that there is likely room for growth in the market, other limitations could hold back that growth, they said.

For years, the commonwealth has been the country’s top producer of burley – an air-drying type of tobacco used in the making of cigarettes – often producing more than six or seven times the amount of Tennessee, which is normally second.

For example, according the USDA’s National Agricultural Statistics Service in 2012 Kentucky farmers produced more than 151 million pounds of burley and Tennessee just less than 29 million pounds.

And Shelby County is almost always in the top five or 10 producing counties in the state. In 2011, the most recent year in which the USDA data collected at the county level, Shelby was second in production, with almost 4.7 million pounds. Barren County had the highest production, with 5.7 million pounds.

But those state and county numbers are way down from peak highs in the early 1980s that saw Kentucky producing about 550 million pounds, and they’ve continued to drop consistently since 1998, when Kentucky had rebounded to produce about 475 million pounds. Since 2000, the state has topped 200 million pounds three times.

“I think it can grow,” said Andy Newton, who is farming more than 300 acres of burley tobacco across Spencer and Shelby counties. “A few years ago a lot of companies wouldn’t buy it, and people got mad at the companies and got out. But they’re back to buying, and if prices stay where they are, there could be some expansion.

“But I don’t look for too much because labor is a big factor.”

Newton said finding people willing to work the fields – planting, topping, cutting and hanging the plants – is becoming harder and harder.

“Labor is the biggest problem I’ve faced,” he said. “We just started using the H2A program last year, and now I don’t know what I’d do without them.”

H2A is named for the visa that allows agricultural employers who anticipate a shortage of domestic employees to hire immigrant workers to perform labor services on a temporary and seasonal schedule. The law sets payment for those workers.

“There just aren’t many young people that are into it [tobacco farming] here,” Newton said. “There’s a big crop out, from what I’ve seen. A lot of plants are being sold, and it’s going to cause trouble because there’s not going to be enough labor to bring it in.”

Newton also said barn space has become an issue.

“Last year our biggest problem was finding a barn to put it in,” he said.

Because small farmers have gotten out of the business after the quota buyouts years ago, and because market struggles have forced many other farmers out of the tobacco business, the number of farmers growing tobacco has dwindled while many of those growing it have increased their acreage.

The barns to hang and dry tobacco are not typical barns but instead need slats that can open on the side to allow in dry air and provide space to hang the plants.

“Barn space is limiting us,” said Paul Hornback, who said he plans to grow about 100 acres of burley tobacco this year. “The problem is it’s so expensive to build a barn. As a farmer, it takes about five years to get your investment back on a farm, but if you’re leasing land – which a lot of people do, and I plan to do this year – it takes about ten to fifteen years to recoup your costs.”

Hornback and Newton both said they’ve built or are in the process of building new barns, but its not enough.

“Last year I bought a twenty-acre plot and the main reason was there’s a tobacco barn on it,” Hornback said.

But with the market currently strong, growth is coming.

“The contracts are solely based on the demand for U.S. tobacco, and that depends on the value of the dollar,” Hornback said. “It’s never a good thing that the dollar is weak, but it helps with the contracts.”

Newton said he’s getting prices for his crop that are higher than he has had in years.

“My prices are averaging about two dollars and two cents [per pound] this year, and that’s the highest we’ve had a in while,” he said.

So if Pratt is going to increase Kentucky’s share of the market, the time to strike is now – if the farms can handle it.