Philip Morris will not buy Georgian tobacco anymore
The future of Georgia tobacco growers suddenly become unclear when it was announced that Philip Morris USA would no longer offer contracts to the local farmers and shut down a purchasing station in Alma.
The representatives of the leading tobacco company across the United States told farmers during a meeting held in Alma last week that it will stop signing short-term contracts with growers. They said the PM will continue working only with the farmers who have long-term contracts, if they are in good standing.
Anthony Peters, a University of West Georgia agronomist admitted that the farmers were shocked by the announcement, since the life becomes even tougher for them now, with that refusal.
The shutdown of the Alma purchasing office demonstrates the decision of the company executives to concentrate both growing and manufacturing in Virginia and North Carolina due to the decline in consumption seen in recent years in America. However, it is not clear how dramatically the blow will hit Georgia tobacco farmers.
The Marlboro-maker bought about 50 percent of all tobacco grown in Georgia. The rest cigarette manufacturers have not expressed any plan to buy additional volumes of tobacco.
Philip Morris also informed the owner of the buying station that the company is no longer interested in its services in conformity with the actual agreement, as Peters confirmed. The PM Representative only admitted to keep buying tobacco by the three-year contract in Georgia instead of demanding the farmers to transport the goods to Virginia or North Carolina.
The University of West Georgia agronomist added that it is very sad that the largest tobacco company would no longer buy local tobacco, since it has been the principal buyer of flue-cured tobacco during decades. He said that apparently the company decision can be explained by the fact that they want to cut the expenses on transportation of tobacco products to their operating plants, and they would simply buy more in Virginia and North Carolina.
PM USA has two buying stations in North Carolina and one in Virginia.
According to the last fiscal year’s report, the tobacco sales topped $69 million in Georgia, distributing evenly among the counties, with Berrien County being the leader in the list with $6.43 million.
James Owens, one of the farmers who were present at the meeting with Philip Morris said he as well as other tobacco growers were stunned and destroyed by the decision.
He said the company has not given any warning previously or any explanation. He added that the farmers who were working with Philip Morris would have to find another thing to do, unless other cigarette companies would buy their crops.
