March, 2003

Marketing quotas limit the amount of tobacco that a producer can sell in a given year. Farm marketing quotas on an acreage-poundage basis are in effect for 2002-crop flue-cured tobacco (types 11-14). The marketing year for flue-cured tobacco begins July 1.

Since 1965, the Agricultural Adjustment Act of 1938, as amended, provides for acreage-poundage quotas for this kind of tobacco. The statutory authority was further amended in 1986 to revise the formulas for the marketing quota and price support level. By 97.6 percent, producers voting in a January 2001 referendum approved the program for the 2001-2003 crops.

The national acreage allotment for 2002 is 278,736 acres, and the national marketing quota for the 2002 crop is 582.0 million pounds, 6 percent above 2001. The effective marketing quota is about 545 million pounds, slightly more than the 2001 quota; this includes adjustment to reflect undermarketings and overmarketings of farm quotas from the previous year. Under acreage-poundage marketing quotas: if the marketings from a farm are less than the poundage quota for the farm, the difference is added to the farm's quota (both acres and pounds) for the next year. Marketings above a farm's poundage quota are deducted from the next year's quota.

The national support level for the 2002 crop flue-cured tobacco is 165.6 cents per pound, 0.4 cents below that for 2001. USDA sets individual grade rates before the marketing season begins.

As a condition of price support eligibility, both flue-cured tobacco producers and buyers must pay a no-net-cost assessment. An assessment of 2.5 cents per pound applies both to producers and buyers for the 2002 crop.

The price support program is available to growers for eligible grades through the Flue-Cured Tobacco Cooperative Stabilization Corporation (Stabilization) under contractual terms with USDA's Commodity Credit Corporation (CCC). Stabilization automatically buys the tobacco not sold at the support rate, using funds loaned by CCC. Up to 103 percent of a farm's poundage quota is eligible for support.

Flue-cured growers are required to designate the auction ware-house(s) at which they will market their 2002 crop to be eligible for price support. Producers are required to certify that pesticides used to produce their tobacco crop have been approved by the Environmental Protection Agency and that these products have been used in accordance with label directions. And they must certify whether a discount variety tobacco is planted.

On June 1, 2002, Stabilization held 51 million pounds of tobacco (packed weight) with an outstanding debt of $144 million.

Charts containing flue-cured tobacco national marketing quota and other information can be found at: Flue-cured Tobacco PDF.

The U.S. Department of Agriculture (USDA) prohibits discrimination in all its programs and activities on the basis of race, color, national origin, gender, religion, age, disability, political beliefs, sexual orientation, and marital or family status. (Not all prohibited bases apply to all programs.) Persons with disabilities who require alternative means for communication of program information (braille, large print, audiotape, etc.) should contact USDA's TARGET Center at 202-720-2600 (voice and TDD).

To file a complaint of discrimination, write USDA, Director, Office of Civil Rights, Room 326-W, Whitten Building, 1400 Independence Avenue, SW, Washington, D.C., 20250-9410, or call (202) 720-5964 (voice or TDD).

USDA is an equal opportunity provider and employer.