Evening star., 1934-12-23
Tobacco Industry Has
Bettered Its Position
BY HARDEN COLFAX.

The successful marketing of the sea-
sons tobacco crop at prices well above
those of last year, together with crop
reduction under the A. A. A. program,
has already proved gratifying stimu-
lus to general business in the tobacco
States Of Virginia, North and South
Carolina, Kentucky and Tennessee,
and also in the North.
1t is reported to the Department Of
Agriculture that tobacco farmers are
meeting their obligations. Banks are
more active and optimistic, and a
surprising demand for consumption
goods is noted, as well as improvement
In tax collections and receipts. Retail
merchants are reported to be very
much encouraged
| Moreover, it Is believed by Federal
| officials that when the N. r. A. code
has been adopted by the cigarette
manufacturers, still further stimulus
will be given to business conditions
and general welfare throughout the
| tobacco States.
1t Is true there has been a renewal
Of agitation for a reduction in the
present Federal levies on tobacco
products. State and local sales taxes
| are felt to weigh heavily upon the
manufacturers and they are chafing
under the processing tax.
However, the cigarette industry has
bettered Its position this year. Figures
recently released by the Treasury De-
partment show that the output of
cigarettes during the first IL months
Of 1894 was more than 10000, 900 900
greater than during the same period
last year, while cigar production has
increased by more than 100000 900.
Arguments for continuing the process
ing tax include the contention that
net profits of the cigarette manufac-
turers are greater than their entire
labor costs.
The total acreage grown to tobacco
in the United States during 1884 ex-
ceeded 1,360,0 acres, the smallest
since 1921. The quality of the
early consignments reaching markets
| last week Is described as the finest in
years, and 1t was apparent that the
Federal crop reduction program has
permitted growers to turn their atten-
| ton to producing better tobacco.
During the depression the consump-
tion Of tobacco products was reduced
somewhat. The American people
smoked fewer cigars and factory
made cigarettes, while pipe smoking
and the use Of hand-rolled cigarettes
increased. ON the other hand, chew
ing continued to decline.
Tobacco Is one of those American
agricultural products Of which about
so per cent is shipped abroad. 1t is
true that we import some foreign to-
bacco, chiefly for satisfying public
taste. Department of Commerce fig
ures show that American tobaccos
are continuing to meet increased for
eign competition. This rivalry may be
intensified by the tendency toward
self -suficiency on the part of many
foreign countries and the high prices
now prevailing IN the United States
for some types Of tobacco. Exchange
rates, however, have operated to offset
some Of these influences. In British
India. Germany, Philippine Islands
and South Africa recently departments
Of tobacco research have been set up
TO develop such types as may rival
American varieties.
The question In the minds of
American shippers of tobacco is not
what price viii be exacted from for
eign buyers. It is, rather, whether
foreign buyers will continue to pay
the price asked or attempt to grow
tobaccos which may, IN o manner, be
substituted for American varieties and
also draw out substitutes from other
countries which may be bought for
.less money.
(copyright. 1e34.)