Richmond daily register. (Richmond, Madison County, Ky.) 1917-1978, 1920-03-24
ENQUIRER PLAINS
WEED PRICE SLUMP
Cincinnati Authority Says High
Average Refuses Claim 20
per cent Was Sold at Loss

enty per cent of the 1919 crop of to-
bacco in Kentucky has been sold at a
loss to the grower and that in many
instances prices have been lower than
those which prevailed prior to the
might rider raids in 1907 and 1908. A
careful study of existing conditions
in Kentucky tobacco markets and a
comparison of official statistics rep
resenting the actual sales for growers
at first hand, dealers and warehouse
resales fails to indicate That these
assertions are based on fact, says the
Cincinnati Enquirer, in an expert
survey of the matter. 1t continues:
At the beginning of the market
season now drawing rapidly to close
abnormally high prices were paid in
practically every loose-leaf center OF
Kentucky. This was a condition
brought about entirely by natural
causes, the main contributing reason
being the old law of supply and de-
mand Manufacturers stock were
low, generally speaking, the new crop
was admittedly smaller than that of
the previous year and apparently not
Of the best quality. 1t was natural,
therefore, that an abnormally heavy
demand should create the competition
necessary to boost prices far above
any that ever prevailed fer Kentucky
tobacco previously. Growers who
sold early in the season made Won
derful profit, fact that is attested by
the thousands of former Gland rent
ers' who have purchased their own
farms through their earnings on the
last tobacco mad" and with just
cause.
Naturally in market Of this sort
very strong speculative element par
iticipated, an element which failed to
take into consideration the fact that
manufacturers invariably have a re
serve stock held over from year &c
year, of varying proportions, and that
steadily rising prices in the leaf mar
kets meant that the cost Of the con-
sumner must inevitably be increased
proportionately, bringing about, per-
haps, an actual curtailment in the pro-
duction. How far reaching this last
conclusion may be will probably not
become altogether apparent for sew.
eral months.
The fact remains, however, that to-
ward the close of January buyers for
the large manufacturing Interests:
found that they had become SO well
stocked up and had spent 50 much
money for the tobacco which had been
absorbed during December and jan
uary that some effort must be made
to curtail.
Another factor that entered into the
situation was the slump in the export
demand Sales during the first weeks
of the season in the loose leaf cen
ters had been confined largely to the
better types Of tobacco required for
manufacturing purposes in the United
States, and these types were eagerly
absorbed at record prices. From the
middle Of January there was trend
marlsetward of the low grades, which
find their outlet in foreign channels,
but the foreign buyers were not edu-
Gated to the high prices affecting
the market at that time and seem pre-
pared to wait patiently until quota
tons should seek a lower level. The
domestic demand had been fairly we'll
satisfied and the low grades of tobac-
co being offered, both in the dark dis
.trict and the hurley belt, were types
totally undesirable for manufacturing
purposes in the United States. Specu-
lators who bought tobacco on a high
market soon found it impossible to
dispose of their holdings at profit
or without loss. Many growers who
had delayed the matter of taking their
products to market were confronted
with the same condition. With COM
petition of the buyers in the open
markets at low ebb, prices for all
grades Of tobacco sought a lower
level. The dissatisfaction among those
who attempted to market their crop
under such conditions were largely
responsible for the claim being set up
that 70 per cent of the 1919 tobacco
crop of Kentucky had been sold at
loss to the grower. The following are
the actual facts about the Kentucky
sales of 1919 tobacco up to the first
of March, 1920 according to satisfies