Anger and frustration clouded the opening sessions of the annual Maryland Tobacco Auction last week, with sellers at one of the eight auction sites around the state refusing to sell when several rounds of bidding on top quality tobacco produced offers barely equal to last year's price levels.
As the smoke cleared, however, sales were on the rise, and at the auctions' close Thursday, business had returned to normal as growers recognized their profits would increase because of greater yields per acre.
According to Tony Evans of the Maryland Department of Agriculture, the farmers' original frustration was the result of last year's leap in the size of bids that left them with similar expectations for this year's auctions.
Last year, he said, farmers enjoyed a 40 cents per pound average increase over the previous year. This year, however, buyers were "paying a consistent $1.80 per pound last year's closing price for choice grades for top quality leaf for the first two days of the auction."
Evans said last year's rise was the result of domestic and foreign buyers bidding up the market because of an expected shortage. The shortage never materialized, he said, and that, coupled with this year's large harvest, prevented any such bidding pressure.
Maryland tobacco is "renowned for its burning quality," he said. "The Swiss are particularly interested," he said, and it was their interest that fueled last year's price hikes.
Growers claim that increased costs had forced them to look for higher prices at this year's auction. After the "opening day shock" over the low bids had passed, Evans said, sales increased daily. "The tobacco is moving," he said.
The buyers, however, are not as quick to move as they were last year.
E. T. Gieske Sr., of Gieske and Nieman, tobacco merchants in Upper Marlboro, said quality is their primary reason for bidding at last year's levels. "It's an average crop," he said, "and you must remember they had an increase of 40 cents per pound last year when the normal yearly increase averages only 5 cents per pound . . . Yields per acre went up dramatically this year. Most of the growers stand to make more money without a price increase."
Roland Darcey, president of the Prince George's County Farm Bureau and a grower, said most farmers "were disappointed; we expected at least a 5 cent increase over last year's prices," but, after following the market for a few days, he changed his mind.
"We still stand to increase our profits on the average of 2 cents per acre over last year," he said.
Darcey said he is satisfied with the modest increase. Otherwise, he said, the farmers might "overproduce to raise short-term profits . . . I wouldn't want the tobacco farmer to get into a position like the dairy farmer, where he is actually overproducing. . . We may not get excess profits," he said, "but we get steady profits."
Other growers were less enthusiastic with the offerings, pointing to inflated costs as a legitimate reason for expecting a jump in this year's bidding.
Edward Allen, a grower from Prince Frederick in Calvert County, sells his crop at the Hughesville auction site and said that he was admittedly "a little disappointed" at the bidding. "They were offering more than a nickel under last year's levels for top grades," he said.
Allen said this was the first time in six or eight years that he had seen such wholesale rejection by farmers on the first day of bidding. Prices being offered, he said, "won't even cover the cost of the crop protection chemicals recommended by the State Department of Agriculture."
Earl Griffith of Lothian had a different view. "Moneywise," he said, "I think we're coming out ahead." Griffith was one of the farmers who 'turned his ticket,' or refused a sale, during the first days of trading. "All of us farmers were looking for an increase comparable to last year's," he said, "but after a while I came around. This happens every year."