Friday, August 27, 2004

Tobacco sales fell fifth year in 2003

Drops to fourth-place cash crop

The Associated Press

LOUISVILLE - Kentucky tobacco sales fell for the fifth straight year last year, dropping to fourth place as a cash crop.

Leading the way were horses, cattle and broiler chickens.

Tobacco brought farmers nearly $1 billion as recently as 1999 and ranked second in sales in 2002, but severe cuts in quota have limited how much farmers can produce.

Sales from tobacco totaled $431 million last year, according to figures released Wednesday by the U.S. Department of Agriculture. That is 12 percent of Kentucky's farm receipts.

Horse sales and stud fees brought in $800 million.

"It's holding its own, but obviously as we need Kentucky agriculture to reduce its dependency on tobacco, it's good to see other commodities pick up," said Will Snell, a University of Kentucky tobacco economist.

Kentucky farmers had agricultural sales of $3.5 billion in 2003, up nearly 10 percent from $3.2 billion the year before. The increase was led by a 32 percent increase in cattle receipts to $543.9 million. Broiler chickens took in $506.6 million, up 20 percent. Tobacco receipts were 2.7 percent lower.

Dennis Cantrill farms in Anderson County and runs 99 head of cattle, up from 45 two years ago. He raises vegetables and sells to farmers' markets. He has all but phased out tobacco.

Cantrill thinks tobacco will continue to be a factor in Kentucky's farm economy, but "those who are serious about making a living in farming have had to diversify."

Snell said he expects tobacco to continue to generate $400 million to $450 million a year for Kentucky farmers.

"I think that is short-lived, though, if we don't get major reform in our program," he said.

A federal tobacco quota buyout, which would pay farmers and quota owners $12 billion to end a Depression-era program that controls prices and limits production, is expected to be considered when lawmakers return to Washington, D.C., next month.

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