Tight Supply May Mean Higher US Tobacco Prices This Year
As if huge legal judgments and widespread social opprobrium weren't enough, the major cigarette companies have another issue to contend with now - rising prices for tobacco.
Opening day in the annual auction market for flue-cured tobacco here Monday saw prices climb an average $10.76 per 100 pounds from last year's opening prices. Growers received an average of $189.99 per 100 pounds, a 6% increase from last year. It's too early to judge how high prices will end up this year - opening day sales consist mainly of tobacco held over from last year's harvest - but growers and industry insiders gathered in this city on the Virginia-North Carolina line say higher production costs and a dwindling supply, along with a high-quality crop, will work to boost prices this year.