• Replace inflammatory rhetoric, stereotyping, and automatic enmity in favor of civil, problem solving dialogue;
• Understand each others' needs, values and concerns;
• Identify areas of common ground and even interdependence, while acknowledging areas of difference; and, finally,
• Work together to create realistic, sensible and sustainable options for communities and families facing pressures associated with transition.

Greetings participants in the Southern Tobacco Communities Project listserve.

The past 2 weeks have again seen considerable activity concerning tobacco and tobacco communities.  Here is a summary of some of the key items based on news reports and personal conversations.  Please feel free to forward me items of interest.

Regards,

Frank Dukes

Here are some web-based news sources:
Tobacco news direct:
Richmond Times-Dispatch - http://www.gatewayva.com/rtd/special/tobacco/
Winston-Salem Journal - http://www.journalnow.com/news/index/business_tobacco.html

Front page:
Lexington Herald-Journal - http://www.kentuckyconnect.com/index.htm
Washington Post - http://www.washingtonpost.com/wp-srv/WPlate/m-national.html
 

FDA and the Supreme Court:

Dec. 1 saw U.S. Supreme Court take up the argument by the Food and Drug Administration that it should regulate tobacco as an addictive drug. The FDA is asking the high court to overturn a ruling by the 4th U.S. Circuit Court of Appeals that says that the agency lacks that authority.  Many justices expressed skepticism about FDA authority.  A ruling in the case should happen by summer.

Judge William Osteen had sided with the FDA when the tobacco companies appealed the FDA proposal to regulate tobacco products. The 4th U.S. Circuit Court of Appeals in Richmond
overturned that ruling in a 2-1 ruling that the FDA lacks the power to regulate tobacco.

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Flue-cured purchase intentions and possible effects on next year’s quota:

The U.S. Department of Agriculture announced Dec. 1 that U.S. cigarette manufacturers plan to
purchase 286 million pounds (farm sales weight) of flue-cured tobacco in 2000. That’s a decrease from 327 million pounds for the 1999 crop and devastating news for farmers.

Intended purchases, average annual flue-cured exports for the preceding three years (334.1 million pounds, down 21.1 million pounds from 1996-1998), and the amount of tobacco needed to attain reserve stock levels are used to determine the annual flue-cured tobacco marketing quota. If stabilization does not sell any stocks by December 15 then the 2000 quota will be about 458 million pounds.  The Secretary of  Agriculture could adjust this total up or down by 3 percent.  A 458 million pound quota would be a 31 percent reduction from 1999.  That is on top of a 35% reduction the past 2 years.  These cuts are unprecedented and many farmers wonder how they will be able to continue.

However, it is very possible that some of the stocks would be sold before quotas are announced on Dec. 15.  If the Flue-Cured Tobacco Cooperative Stabilization Corp. (the co-op) sold 50 million pounds of stocks, then the quota could be 508 million pounds,  a 24 percent decline from the 1999 quota.

Philip Morris has sought a discount of around 40 percent to 50 percent in the price of the
surplus U.S. tobacco.  A deep discount means that next year’s assessment to pay for the loss (the co-op has already paid producers the minimum purchase price for the tobacco that is being held and must reimburse the Commodity Credit Corporation for that amount) could be much higher.  Some people also speculate that the 3 years of large cuts represents an effort by companies to make the farmers vote out the quota and price-support system and shift to direct contracting.

Further program information is available from:
http://www.fsa.usda.gov/pas/news/releases/1999/12/1660.htm
or contact Bob Tarczy, telephone (202) 720-5346, E-mail address
Bob_Tarczy@wdc.fsa.usda.gov

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Burley markets open very slow:

Burley tobacco markets opened Nov. 29 and sales were both slow and low-priced.  The Kentucky opening-day average was down 9 cents from last year, to $189.70.  If sales continue in that manner, another big quota cut will be expected for the burley producers as well.

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Phase I payments lower than expected:

States are likely to get less money from the tobacco settlement than initially thought
because of the decrease in sales of tobacco products.  The exact reduction has not yet been calculated. It will affect settlement payments due to states in April. The settlement does factor in inflation of 3 percent or the current inflation figure, whichever is higher.

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Secondhand smoke new report:

The National Institutes of Health has a new report on the health risks of secondhand smoke.  The monograph, "Health Effects of Exposure to Environmental Tobacco Smoke: The Report of the California Environmental Protection Agency," links secondhand smoke, also called environmental tobacco smoke (ETS), not only with lung cancer, but with heart disease, sudden infant
death syndrome (SIDS), nasal sinus cancer, and a host of other diseases in
both adults and children. It was reported that the CalEPA (who wrote the original report) explictly considered the tobacco industry's scientific objections to the US EPA report, including the studies that the tobacco industry claimed US EPA left out.

A copy of the monograph is available by calling NCI's Cancer Information Service at 1-800-4-CANCER.  The report is available, along with some of the earlier reports, on NCI's Web site at http://rex.nci.nih.gov/PREV_AND_ERLYDETC/PREVED_MAIN_DOC.html.
The Center for Disease Control and Prevention is making copies of the monograph available to each state health department.

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U. S. Dept. of Justice lawsuit:

The Justice Department’s tobacco-suit trial may not start until 2003 given the enormous amounts of information that need to be exchanged beforehand. The government is seeking an
estimated $20 billion in yearly smoking-related Medicare expenses. The two sides could still settle, or a new president could drop the suit.

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Kentucky news: “On Common Ground” is a special, prominent 4-page pull-out in the publication “Farmer’s Pride” that features public health and tobacco community needs.

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Virginia news: Governor Jim Gilmore today announced the appointment of Carthan F. Currin III as executive director of the 31-member Tobacco Indemnification and Community Revitalization Commission.  He is a former developer,real estate manager, was director of the Franklin County Chamber of Commerce, and currently serves as acting executive director of the Governor's Employment and Training Department.
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Tennessee news: Dr. Jack Britt of the U. of Tennessee has developed a proposal that would assist farmer making a transition away from tobacco.  It would include 4 components:

 Demonstration projects at Extension facilities;
 Market development;
 Direct technical services to producers;
 Distance education.

Tennessee still has 3 lawsuits pending that are blocking payments under Phase I.  Such payments won’t be made until summer even if resolved sometime soon.

The prospects of a joint proposal or an alliance between farm and health groups are uncertain, although considerable interest in both groups continues.  A broad coalition of health groups is meeting to develop their own ideas about identifying and meeting their needs.  The farm groups have had a full agenda dealing with the opening of the burley markets and setting up Phase II processes and structures.
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North Carolina news: the suit by growers against the attorneys-general and companies will likely be filed in the next two weeks.