Imagine that you are a small scale farmer in Kentucky. Long ago, things were going great for you and your farm. Your crop was in great demand and was of the highest quality. You can afford to grow the single crop as your sole job, as it pays the bills and you even have some extra money. However, several years later the farm is not doing so well. Nothing has changed as far as your methods of farming or anything else that you could possibly prevent. Now you must either go out of business and find other means of supporting yourself and your family or start over with a new crop and hope for the best. None of this is your fault. You are simply a victim of circumstance. This is happening to many people today. The Kentucky tobacco farmer is becoming a rare find in the commonwealth in a land where tobacco was once known as “the king of crops”. “It certainly isn’t the King of Kentucky crops anymore,” said UK Tobacco specialist Will Snell. Tobacco farms are closing in at an enormous rate in Kentucky.
Tobacco is a crop that grows natively in both North and South America. It is believed it has been growing here since 6,000 B.C. However, it wasn’t until around 1 BC that humans began using it. The Native Americans were the first. They began using the crop for many purposes but mostly for ritual and medicinal purposes. They believed that tobacco was a miracle drug. They would use it to treat nearly everything, from treating major wounds to chewing it for relieving tooth aches. The Native Americans had great respect for the crop. (History of Tobacco)
On October 15, 1492, the Native Americans offered many dried leaves of tobacco to explorer Christopher Columbus. After that sailors were constantly making trips to bring plants back to Europe, and it was growing all over the continent in no time. The Europeans were blown away by its healing powers. In 1571, A Spanish doctor named Nicolas Monardes claimed that tobacco could cure 36 health problems. By the 1600’s the plant was so popular that it was often used in place of currency. Tobacco was as good as gold to the people. Tobacco eventually became more of a recreational thing and its popularity grew exponentially over the next several hundred years.(History of Tobacco) By 1944 cigarette production was up to 300 billion a year.(CDC, Smoking and Tobacco Use)
Surgeon's General Warnings must be placed on all tobacco products
All this tobacco usage was good news for the farmers, especially in the states that it grew extremely well in, such as North Carolina and Kentucky. Tobacco was in high demand and the farmers in the area were meeting the demand. However, things started going downhill for the tobacco industry. In 1964, Surgeon General Luther L. Terry put out a publication to the general public announcing that the tar in tobacco cigarettes was a cause of lung cancer. As you can imagine, this was pretty scary to the general American public. The report led to the Cigarette Labeling and Advertising Act being enacted by congress in 1965. The act required that all cigarette packages must have a label on it that says “Cigarettes may be hazardous to your health.” During the decades that followed, people became more and more aware of the dangers of tobacco, causing its popularity to decrease.
While this is a terrific thing for the human race in general, it has taken a heavy toll on the farmers that grow the tobacco. The number of farms growing tobacco went from 512,000 in 1954 to 56,977 in 2002(Capehart). An 89% drop in farms is a huge problem for Kentucky and other major tobacco producing states.
The health risks of using tobacco is a major reason for the shrinkage of Kentucky tobacco farming. People are more aware now than ever of its dangers, and so are the big tobacco companies. In 1998, the nation’s largest cigarette companies signed a landmark legal settlement and agreed to pay $206 billion to 46 states, including Virginia, over 25 years to cover smoking-related health-care costs (Blackwell, 2008). While this may seem like an awesome thing in every aspect, the $206 billion directly impacts the tobacco farmers. “ These health risks make people want to stop smoking tobacco. If the demand is lower, the companies don’t buy as much (tobacco) from the farmers,” explained Snell. If the tobacco companies have less money in their hands, they have less money to purchase tobacco with.
Both Governor Beshear & Governor Fletcher favor higher taxes on tobacco products
During these troubling times for tobacco, one would think that the government would help the tobacco farmers much like they do with troubled farmers that grow other crops and livestock. However, the government is doing more harm than good.There was a time when the Kentucky Cigarette tax was only $0.03. It remained that way until Ernie Fletcher took office. Ernie Fletcher was Governor of Kentucky from 2003 to 2007. Before coming into office, Fletcher was a physician and knew the harmful effects of tobacco very well. He proposed a $0.30 tax (Beisk). His proposal did not have much approval by Kentucky’s congress and did not succeed. However, Governor Steve Beshear was successful in 2009 and the Kentucky cigarette tax rate was raised by $0.30 (Kentucky Department of Revenue).”Taxes certainly impact consumption” said Snell. In addition, the federal tobacco tax rate is $1.01 per pack (Tobacco Tax Bureau). All these taxes are very unappealing to the customer. Around 15% of the price of cigarettes is contributed by taxes (Snell). Many smokers are quitting smoking only because they can’t afford them. This is decreasing the supply of tobacco needed by tobacco companies. Therefore, it is also decreasing the amount of tobacco they purchase from the farmers.
The government also hurt the ailing tobacco industry by creating the federal tobacco quota system. The Federal quota system was implemented due to an event called the “Black Patch War”. A man named James Duke owned the largest tobacco company in America. Since he had somewhat of a monopoly, he decided that he would pay less to the farmers to increase profit for himself. The farmers noticed what was going on and decided to band together and refuse to sell to him. This system was effective in proving their point. However, they weren’t making any money either but refused to budge. The federal government decided to step in to save the industry. They implemented a quota system, in which tobacco growers could grow a limited amount of tobacco for a higher price to the government. The cigarette companies would then buy the tobacco from the government, eliminating the risk of strikes. This held the American grown tobacco’s price much higher than it naturally would be, so the cigarette companies began purchasing tobacco from foreign growers instead of from the government. The quota system was failing because of this and in 2004 the US government ended the quota system. This eliminated the restriction of how much a farmer could grow and how much the tobacco companies could charge, in turn decreasing the amount of farmers needed . “It’s not profitable for the masses anymore” said Snell. Big tobacco farms, in smaller numbers, have taken over the industry and have stomped out most of the little farmers (Snell).
The purchase of forign tobacco leaves are a huge concern for the Kentucky tobacco industry. “(Forign tobacco) is really killing the domestic farmers”, explained Snell. While the demand for American brand cigarettes, such as Winston and Marlboro, are increasing in the global market, these American companies use very little American-grown tobacco leaves in their products. This wasn’t the case in the early 1970’s. At that time, American-made cigarettes contained only around sixteen percent foreign tobacco. However, since the 1990’s, U.S. cigarette manufacturers have increased the amount of foreign tobacco in cigarettes made in the US by fifty-six percent! If they still used as much American-grown tobacco as they did in the 1980’s, they had have to purchase an additional fifty percent. That is 275 million more pounds a year (Campaign For Tobacco Free Kids). “How are we supposed to compete with their lower prices?” asked Snell, “We just can’t do it!”
The cigarette companies are not only decreasing the amount of American tobacco they use. They are even decreasing the amount of cigarettes they manufacture in the United States. Since the 1990’s we have sharply decreased the amount of cigarettes we export. The number has gone down by nearly 50% since 1996. And these foreign-made cigarettes contain even less American tobacco than the ones made in the states. If we still exported as many cigarettes now as we did in 1996, tobacco companies would have to purchase an additional 90 million tons of tobacco from farmers in Kentucky, North Carolina, and other major tobacco producing states. (Campaign for Tobacco Free Kids). Farm hand jobs are also on the decline. “Young people (in America) don’t want to do farm jobs anymore. The farm owners now have to employ migrant workers, which cost a lot more because of all the paperwork they have to do to keep them legal. “The cost of labor is now half of the cost of producton.”
Also, big tobacco companies have hurt the American tobacco farmers by providing funding, seeds, etc. to foreign tobacco growers. “ Of course the companies are going to invest in the cheaper tobacco” said Snell, “They would love to make the cheaper tobacco better quality”. This improves their crops significantly, making our crops much less valuable. In the ‘80s, America produced more tobacco than all the other countries in the world combined. Things have changed since then though, and foreign growers produce more than five times as much tobacco as growers in the US. If the United States still had control of the same portion of the global cigarette export market as we did back then, the demand would be 300 million tons higher (Campaign for Tobacco Free Kids). That’s a huge amount of tobacco, and a lot of money as well.
One would think that since that the decrease in United states consumption of tobacco products would have an enormous impact on the global demand for cigarettes. However, the impact is actually very small. “International consumption isn’t going down much,” said Snell. From 1990 to 2002, the amount global demand for Burley and Flue-cured tobacco (these are the two most popular types of tobacco that are grown) has went down by less than one percent a year. (CFTBK).
Tobacco is very important for the state of Kentucky.We are number two (second to North Carolina) in tobacco production in the U.S. with over 186 million pounds produced annually. And we are number 1 in the production of Burley tobacco, with production at over 153 million pounds a year. The tobacco industry makes up a good amount of Kentucky’s entire farming industry and rakes in over 300 million dollars in the state. (Kentucky Tobacco Facts). However , this is much lower than it used to be. “People tend to grow more corn or raise chickens now instead of tobacco,” said Snell.
Since tobacco doesn’t pay the bills anymore, the farmers must retire, find new non-farm related jobs, or change their ways of farming. No single crop or type of farming has replaced tobacco in the areas it once monopolized. Some things farmers have tried to grow to fill the gap is grapes, pumpkins, corn, apples, etc. Some have even tried Alpacas and llamas! However , the most success has come from the farmers who are growing a wide diversity of different agricultural products. “Since the farmers already have the skills to grow tobacco, they still grow some, but they are also growing other crops to make ends meet,” said Snell. Growing a lot of different crops is the best solution to the problem. One elderly Maryland couple is living off of operating a corn maze, greenhouse and produce store as well as growing apples, peaches, pumpkins and grapes on his 100-acre farm. (Zapotosky). Agri-tourism is also helping in the quest to replace tobacco. However, these new forms of agriculture are difficult to transition to, as the new forms of agriculture require new skills. Many tobacco farmers are 50+ years of age and have been growing nothing but tobacco for much of their lives. It is very difficult, and sometimes not possible, for them to learn all the tricks of the trade when it comes to growing other sources of livelihood.
Tobacco farms are in crisis. What was once a very booming industry is now going down the drains. Tobacco was not only a source of income, but was a way of life for those in tobacco growing communities. Tobacco farmers have done nothing wrong. They are simply doing the only thing they know to do. They simply grow the tobacco and sell it. Farms are closing down. Farmers are filing for bankruptcy. And there is little to do about it. Unless we figure out a replacement for tobacco, convince tobacco companies to purchase more American-grown tobacco, or see an increase in tobacco usage, we will continue to lose tobacco farms and farmers.
Kentucky Tobacco Farmer Crisis 