Virginia’s prized cash crop

By Barbara Bent

Tobacco’s roots in Virginia are deep.

John Rolfe cultivated the first tobacco crops in the colony of Virginia in 1611. Native Americans in the area began growing the crop before then, but Rolfe perfected the European standard, according to the Encyclopedia of Virginia.

After centuries of prosperity, the tobacco industry in the United States is waning, according to Harry Lea, a warehouse owner and Danville, Va., native. Lea, 71, is a third generation tobacco warehouseman who took up his father’s business in 1979. He witnessed the transformation of the industry at the turn of the century.

IMG_7227

A dried tobacco leaf.

“Generally, tobacco was sold by auction,” said Lea. “[In 1865] the auction system started in Danville, Va., and continued successfully until the year 2000.”

Companies decided to bypass the auction system at this time and instead negotiate directly with growers through contracts. One reason for this shift was efficiency for the company. Another was the natural deterioration of an antiquated system.

“On the auction system back in the ’70s and ’80s, we might have as many as 12 and 14 buyers on the line each day,” said Lea. “By 1999 there were four or five buyers in the auction line and that just was not competitive. So that system sort of, I would say, almost died instantly.”

Three or four auction sales remain in and around Danville, but only for tobacco that is lower grade and not suitable for sale under large company contracts. Generally, only one to three buying companies are currently represented in these auctions, which is why they are not as common.

Lea said that tobacco growing is on the decline, especially Virginia flue-cured tobacco.

“We’ve gone down from, back in the ’70s and ’80s, from about 1.3 billion pounds down to probably around 400 million pounds,” said Lea. “So it’s decreased, essentially two-thirds to 70 percent over the last 25 years.”

Two reasons for the decline are health concerns and global competition. Public health officials have been fighting tobacco use for decades, with the first Surgeon General’s warning appearing in 1964 to warn of the dangers of smoking. According to a report by the Centers for Disease Control, cigarette smoking rates have declined over the last 50 years from nearly 45 percent to 16.8 percent in 2014. In the global market, countries like China, Canada, Brazil, Argentina and countries in southern Africa have been growing much more tobacco than the U.S. produces. China National Tobacco Corporation produces the most cigarettes in the world, controlling 44 percent of the market, according to Campaign for Tobacco Free Kids.

According to a report by the U.S. Department of Agriculture, cigarette tobacco is cheaper to produce outside the United States. This is due to low costs of labor and lack of labor standards. Many American cigarette companies invest in growers overseas for the lower cost. Though the quality of the tobacco is not as high as American-grown tobacco, manufacturers can doctor the flavors to improve the taste of cheaper tobacco.

The number of tobacco farms in the United States has decreased from almost 180,000 in the 1980s to 10,000 in 2012, according to the CDC. Growers in China, India and Brazil have displaced many American tobacco farmers.

U.S. Farms on the Decline

Sarah Hazlegrove, a photographer and native Virginian, captures images of dilapidated farm houses that one would see on the side of a highway almost anywhere in the state. She finds an eerie sense of beauty in collapsed silos and caved-in barns.

“I always felt that there was something sort of collapsing around the family farm,” said Hazlegrove. “Seeing how the economy of agriculture was shifting and that family farms were being turned into strip malls and parking lots made me really sad.”

Hazlegrove has traveled the world visiting tobacco farms and watching laborers work the farms. She documents families and follows their journeys through her photography. She also acknowledged the massive shift from growing tobacco in the United States to other parts of the world. In these developing countries, Hazlegrove said, farm labor resembles what it was in the U.S. when family farms were dominant.

Virginia’s Cigarette Tax

Virginia has the second-lowest cigarette tax rate in the nation. Taxes in other tobacco states have increased over the years, but Virginia’s remains static at 30 cents per pack. North Carolina’s is 45 cents per pack, Kentucky’s is 60 cents and Tennessee’s is 62 cents. Raising the tax could create revenue to use in many different ways, but Virginia legislators have not budged.

“That’s a result of several tobacco companies being located in Virginia,” said Lea. “It’s also something that the growers in Virginia have used their political influence to try to keep the legislature from increasing taxes.”

According to Lea, cigarette taxes have very little to do with tobacco itself.

Growers sign yearly contracts with manufacturers. The manufacturer controls the prices on the contracts and expects the grower to follow through. The main duty of the contracts, according to Lea is to allow the grower to get paid for producing his share of tobacco.

“But the grower right now is the one that’s really being squeezed,” said Lea. “I feel like it’s shortsighted on the industry’s part not to protect their U.S. grower base to make sure that these people are making enough money so that they can reinvest in their farm each year to be able to provide the type of quality these companies are looking for. But if they keep on being squeezed and squeezed, you can’t expect a farmer to pay $30- or $40,000 for a curing barn when he’s not going to get a return on his investment.”

Though many other countries grow tobacco now, nothing beats Virginia’s tobacco quality, according to Lea. He believes a low cigarette tax in the state reflects the tobacco industry’s history and significance in Virginia. Robert Mills, a tobacco grower in Callands, Va., remains optimistic about the future of the industry in the state. His farm experiments with growing organic tobacco and bioenergy tobacco for fuel. He believes that the key to staying in business is to diversify.

“The longevity of the tobacco industry looks good here in Virginia,” said Mills. “There are a lot of young growers that are college educated. These younger growers seem to be a little more open-minded, a little more progressive and a little more adaptable to change.”