PROPOSED PRELIMINARY REPORT OUTLINE
A. The Commission was created to address two problems, both of which require action
|The difficulties facing many U.S. tobacco farmers and their communities caused by the reduced demand for U.S. flue-cured and burley tobacco that has led to dramatic drops in quota and emerging changes in the tobacco market that could threaten the tobacco family farmer’s way of life;|
|The harm to health and economic costs caused by tobacco and the continued large numbers of children using tobacco, a problem that faces the entire nation but burdens tobacco growing states disproportionately because of their smoking rates|
B. The Commission is in part the result of several years of work between tobacco farmers and the public health community that has demonstrated that they have many concerns in common and share an interest in addressing the problems facing tobacco farmers and the public health in ways that promote both goals at the same time. This report builds on those areas of agreement and shared values. The Commission was also created because of the possibility that the problems facing tobacco farmers today may reflect long term trends not susceptible to quick fixes and stem from many causes and not just reduced domestic consumption due to health concerns.
C. The Commission recognizes the important role the tobacco price support program has played over the years in bringing stability to the economic well being of the tobacco farmer and preserving the well being of the small family farmer.
D. The goal of this Commission report is to identify those steps that should be taken to assist U.S. tobacco farmers and their communities and promote the public health.
In order to arrive at the solutions that will best assist tobacco farmers, especially family farmers, and their communities, it is necessary to better fully understand the range of factors and trends that have led to the current situation.
Suggest the Commission look at 15 year and 5 year trend lines for various factors. The following list is tentative and illustrative. The impact of these trends and factors should cover both their direct economic impact, but also look at how they impact small family farmers as well as other farmers if the impact is different.
|amounts sold annually totally and for domestic use and export;|
|U.S. share of global flue-cured and burley production and sales;|
|annual flue-cured and burley quotas.|
|U.S. cigarettes consumption trends|
|Worldwide demand for cigarettes. Production and manufacturing are not decreasing on a global scale.|
|e.g., amounts sold/used annually for cigarettes made and consumed in U.S.;|
|percentage of U.S. leaf in American-made cigarettes or in such cigarettes sold in U.S.; annual cigarette consumption in U.S.;|
|Breakdown on where the tobacco dollar goes as between farmers, manufacturers, etc.|
|Changes in US cigarette prices and the reasons for these increases.|
|e.g., amounts sold/used annually for cigarettes exported from U.S.;|
|percentage of U.S. leaf in exported American-made cigarettes;|
|U.S. exports share of all U.S. brands and american-blend cigarettes sold overseas;|
|U.S. imports of flue-cured and burley;|
|Overseas manufacturing by U.S. companies or of U.S. brands.|
|e.g., amounts of US tobacco leaf used in cigarettes manufactured overseas by U.S. cigarette companies, by BAT, or in Japan Tobacco's RJR brands; foreign production of flue-cured and burley (total and just American-quality);|
|Foreign exports of American-quality flue-cured and burley (total and American-quality);|
|Amount of foreign grown tobacco available to compete with high-quality flue-cured and burley used in american-style cigarettes;|
|foreign prices for burley and flue-cured (total and American-quality);|
|e.g., flue-cured and burley prices over time;|
|costs of production; quota-leasing costs (and number of farms with leased versus owned quota);|
|new costs facing tobacco farmers, i.e. baling, barn redesign to reduce nitrosamine levels, grading tobacco. [State-specific data where possible.]|
|e.g., trends re number of: tobacco farms;|
|big versus small farms;|
|full-time vs. part-time tobacco farmers;|
|minority tobacco farmers;|
|average age of U.S. tobacco farmers;|
|reliance on alternative crops or non-tobacco income;|
|number of non-farming quota holders. [State-specific date where possible. Some of this information could be placed in section IV, instead, as appropriate.]|
The accompanying narrative should discuss these facts and trends and their causes, and explain their relationship to the overall demand for U.S. tobacco leaf and to the economic and health problems facing tobacco farmers, communities, and states – short term and long term.
- Discuss scientific knowledge about harms and costs caused by smoking and other tobacco use.
- Impact of smoking and other tobacco use on tobacco states and tobacco-farming communities
|e.g., state-specific cigarette sales; adult prevalence; youth prevalence; spit-tobacco use by adults and youth; annual deaths from tobacco use; projections of future daily smokers and tobacco-caused deaths among current children; healthcare costs from tobacco use; comparisons with non-tobacco-state averages or national data.|
|percent of farm income,|
|etc., and related trends|
Describe the role of the tobacco program over time and today, focusing both on the economic issues and the role of the program in preserving family farms
|Impact of price protection|
|Impact of quantity controls|
|History and Impact of leasing|
|Impact of Auction system|
|Impact on quality issues|
|Potential Impact of contracting.|
|Discuss possibility that previously presented farming and public health trends will continue and the impact of farmers and their communities if this happens.|
|Potential Impact on the continued viability of the price support program|
|Potential impact if the tobacco support program is ended by vote:
- Buy Out Options for farmers
- Buy Out options for non-growing quota holders – to reduce costs to farmers and to eliminate the role of non-grower quota holders
- Initiatives to Enhance Tobacco Farmers' non-tobacco or Supplementary Income Opportunities. Address market barriers to alternative crops
- Promotion of In-State Grown Commodities - consider the concept of state hospitals, schools, prisons, etc being given incentives to buy state grown farm products.
- Tax incentives for attempting non-tobacco alternatives on their farms or for different uses of tobacco.
1. Economic development and redevelopment options for counties that are heavily dependent on tobacco
- Options for promotion of U.S. leaf (without increasing U.S. or foreign tobacco consumption). For example,
|development of bioengineered tobacco for medical purposes|
|make sure foreign grown tobacco is required to use same standards as American-grown leaf;|
|Look for ways to raise the quality of American tobacco to make American more desirable in competition with non-American tobacco;|
|new markets (China);|
|domestic content labeling;|