Another tobacco farmer loses it all

Self-employment/entrepreneurial pursuits has always been part of my family, though not farming... my husband and my father both.

And no, there is no unemployment insurance and never has been. To be self-employed carries great risks...but usually people know that when they DECIDE on this line of work. If you work,you get paid. If you don't, you don't. If an external force or situation interferes with your livelihood, you are out of luck. We know it well.

Sometimes you hit the jackpot and sometimes you lose. There are also no benefits and no holiday pay and no sick leave. You are the boss and the employee and you do the dirty work and the financial planning.

The benefit is the freedom to do what you want to do and when you want to do it. BUT with the freedom comes the huge responsibility for organizing your jobs and your daily work...and the risk. Self-employment is high-risk employment, as I see it.

I keep reading comments about from everyone regarding the farmer that the bank is going to foreclose on his farm and everyone is putting the blame on the bank, the government etc. But the only person to blame is the farmer, he signed the papers and agreed to pay back the bank. That farmer knew a while ago that the tobacco industry was going down. Maybe he should have found other employment so he would not be in this situation. If the bank was going to foreclose on me because I was not paying my bills then I would be doing everything possible to keep some income coming in. Even if it meant working at Tim Horton's. Also how fair would it be if the bank said "oh, I see your a farmer, don't worry about paying your debts we will take care of it because it is not your fault" Maybe it is the governments fault, but this issue has been going on long enough. Everyday there are people who lose their jobs, no fault of their own (layouts, shut downs) and they still have to pay bills and they are not protesting in front of banks, so why is this a big deal just suck it up and deal with it. There is always bankrupcty.

Ja9 wrote:

I keep reading comments about from everyone regarding the farmer that the bank is going to foreclose on his farm and everyone is putting the blame on the bank, the government etc. But the only person to blame is the farmer, he signed the papers and agreed to pay back the bank. That farmer knew a while ago that the tobacco industry was going down. Maybe he should have found other employment so he would not be in this situation. If the bank was going to foreclose on me because I was not paying my bills then I would be doing everything possible to keep some income coming in. Even if it meant working at Tim Horton's. Also how fair would it be if the bank said "oh, I see your a farmer, don't worry about paying your debts we will take care of it because it is not your fault" Maybe it is the governments fault, but this issue has been going on long enough. Everyday there are people who lose their jobs, no fault of their own (layouts, shut downs) and they still have to pay bills and they are not protesting in front of banks, so why is this a big deal just suck it up and deal with it. There is always bankrupcty.

Well normal joe blow doesnt have say for example 300,000lbs of quota in his name which he is unable to sell at the moment to bail himself out, a liberal motion just passed in the house of commons for a buyout, why is it fair this farmer will have his farm and quota taken from him when it looks like a buyout could come in the fall?

How fair would it be to you for example if you owned a house, car, or whatever and the government told you that cant sell it at the moment even if you wanted to. How fair would it be if you wanted to sell your house for 150,000 because the bank demanded 120,000 debt paid (example of what house appraised for) and someone told you no you cant sell it, your going bankrupt and the bank is valuing your house at zero dollars, to the street for you!

The situation is not the same as the nonfarmer and how do you know this person isnt working at tim hortons, trying different crops and doing all he can to get himself out of trouble? farmeres cant get unemploymentlike nonfarmers can either, there is no help if you cant find a job immediately.

My question is would it be better for Canada to follow the US and have the government stop being a middleman? Seems like tobacco farmers in the US are having a boom since they can sell to whomever they want.

Spidubic wrote:

My question is would it be better for Canada to follow the US and have the government stop being a middleman? Seems like tobacco farmers in the US are having a boom since they can sell to whomever they want.

The US gave a 10USD/lb quota buyout to their farmers, we cant even get 1.75, those farmers wouldnt still be growing if their government didnt provide the help to clear their debts. As for selling to whoever you want, im not sure I agree with that, all that tobacco is going straight to american and canadian reserves. For me personally I just want to clear my debt and get the hell out, im tired of it and I think 95% or more of tobacco farmers feel the same way.

Here's something similar, Skully. Though you think "non-farmers" are in some other category.

Build 8 spec houses in the 80's. Bottom falls out of the housing market. You have 8 houses on your back. Heat, hydro, mortgage payments to pay and no buyers. 8 mortgages. Bank calls the loans. You lose it all.

The bank advised you to build...they gave you the money to build. The real estate told you to build. But then the bank also said: "Give us back our money NOW!"

Farmers are NOT unique in their collapse. There are many people who have suffered an economic collapse...for whatever reason, and lived on to carry on business. It's a very bad scenario...that's true. But not one that has not been experienced before by non-farmers.

Sometimes the banks and others who give advice give the WRONG advice based on the current situation or climate. The climate changes. And the client is the one who takes the fall. That's the risk of doing business.

cking wrote:

Here's something similar, Skully. Though you think "non-farmers" are in some other category.

Build 8 spec houses in the 80's. Bottom falls out of the housing market. You have 8 houses on your back. Heat, hydro, mortgage payments to pay and no buyers. 8 mortgages. Bank calls the loans. You lose it all.

The bank advised you to build...they gave you the money to build. The real estate told you to build. But then the bank also said: "Give us back our money NOW!"

Farmers are NOT unique in their collapse. There are many people who have suffered an economic collapse...for whatever reason, and lived on to carry on business. It's a very bad scenario...that's true. But not one that has not been experienced before by non-farmers.

Sometimes the banks and others who give advice give the WRONG advice based on the current situation or climate. The climate changes. And the client is the one who takes the fall. That's the risk of doing business.

Better example would be you have those houses built and on the side you also own a 1 million dollar business, the bank calls the house loans, the guy goes to try and sell the million dollar business to clear his debt but the government says umm sorry we wont let you sell it, boom he loses it all. Why isnt he allowed to sell his business in this case? why is that business being valued at zero even though its clearly worth 1 million, why is the bank not giving this man the opprotunity to sell that business or waiting to see what the government will do and why they are not letting them sell it? This is why the tobacco situation is unique, this doesnt happen to anyone where you are told you cant sell the stuff you own to clear your own debts. Basically tobacco farmers are being forced into bankruptcy.

The problem here is the quota, the farmer owns it, its frozen right now but its worth money, a buyout will prolly eventually be coming, say he can get 1.75/lb for 300,000lbs, thats 525,000 dollars and say his debt is 500,000, its clear and can keep his farm.

Hey Skully

What about the guys that own a ton of quota?

Why aren't they, many of which are well know businessmen in Norfolk not just in tobacco, taking the lead here and using their muscle?

They seem to be sitting back collecting their dough while the little guy is getting creamed...or am I wrong?

SkullyCapone wrote:

The problem here is the quota, the farmer owns it, its frozen right now but its worth money, a buyout will prolly eventually be coming, say he can get 1.75/lb for 300,000lbs, thats 525,000 dollars and say his debt is 500,000, its clear and can keep his farm.

What if the quota is worth only $1/lb? Remember, quota was given out for free with no value attached to it.

The farmers bought and sold quota though in order to guarantee themselves above average incomes over the years until recently.

At the time that the quota was frozen, quota was selling in the neighbourhood of about $0.90/lb. Why should it be worth more than that all of a sudden?

The difference between the builder and the farmer is that he/she probably didn't live in one of those 8 houses that he/she built on spec. The farmer lives where he works. Most business people have their home in their spouses names so if anything happens they won't lose the family home.

Watchman wrote:

SkullyCapone wrote:

The problem here is the quota, the farmer owns it, its frozen right now but its worth money, a buyout will prolly eventually be coming, say he can get 1.75/lb for 300,000lbs, thats 525,000 dollars and say his debt is 500,000, its clear and can keep his farm.

What if the quota is worth only $1/lb? Remember, quota was given out for free with no value attached to it.

The farmers bought and sold quota though in order to guarantee themselves above average incomes over the years until recently.

At the time that the quota was frozen, quota was selling in the neighbourhood of about $0.90/lb. Why should it be worth more than that all of a sudden?

Quota for free? That may have been the case in 1820 but for last 20 years I havnt seen anyone getting quota for free. I paid near 450,000 dollars for all of mine over the years. I didnt buy and sell it to make money either, i bought it to be able to grow the size of crop I wanted. I own 260,000lbs of quota myself and im only able to grow 11 acres out of it. Farmers bought more and more quota as the crop size dwindled in order to maintain a good crop size.

Batman wrote:

Hey Skully

What about the guys that own a ton of quota?

Why aren't they, many of which are well know businessmen in Norfolk not just in tobacco, taking the lead here and using their muscle?

They seem to be sitting back collecting their dough while the little guy is getting creamed...or am I wrong?

Actually in the first buyout most those businessmen cashed in, there isnt many left and the reason the government asked the board to freeze the quota three years ago was to stop people from buying more to cash in. Right now no one is making any money because you cant sell it and no one is willing to pay big money to rent it seeing as how the price of tobacco has dropped year after year. Cost 2 dollars or more a lb to grow, companies want to pay 1.99 this year max and thats for top grade stuff, if you have a poor crop you may only get 1.50 , you would have to be an idiot to rent for .60 cents a lb.

Most farmers including myself own alot of quota, we need to to grow a decent crop size, and even with me owning 260,000lbs I still cant grow a decent crop anymore. Also even if i or anyone wanted to rent their quota they can only rent out what they have growable, if the cut is 16% growable that doesnt leave you with anything.

You have made some good points Skully. To me, unless people have actually grown tobacco or sharegrew, they are unclear on many issues. There was a booming time way way back, but it's not that way now.

So why did I see tobacco fields around the Langton area today? How/why are farmers still growing tobacco? How can they afford to? Who will they sell it to?

cking wrote:

So why did I see tobacco fields around the Langton area today? How/why are farmers still growing tobacco? How can they afford to? Who will they sell it to?

The government said no to a buyout for now but they then stated tobacco farmers need to get into exsisting programs. If you do not grow a crop you cannot get into any programs, problem is I see no programs so its just another lie by the government. There is also fear that if you stop growing you will not be eligible for a buyout should one come.

Im sure along your journey you also seen those same farms growing several different crops, but never gets mention, we are trying to make things work it just isnt going well.

cking wrote:

So why did I see tobacco fields around the Langton area today? How/why are farmers still growing tobacco? How can they afford to? Who will they sell it to?

Forgot to add you may also be seeing burley tobacco, im growing 15 acres of it myself, half it im smoking and the other half im air curing, there is no quota involved in this type of tobacco and you dont have to cure it using gas and hydro. We smoke it with wood chips for the smoke, the air cured it hangs in the kilns for a few months and the air does the work. Much more labour involved but its just somthin we are trying.