Tobacco Brokers Left High and Dry By Suit Settlement
John Buchheister was running around last week trying to keep his business alive. Buchheister's business is tobacco, and for 61 years his family has owned and operated Planters Tobacco Warehouse in Upper Marlboro.
The family has been brokering tobacco in this country sinceearly in the last century, and in Germany well before that. With many farmers in Maryland agreeing not to grow tobacco in return for cash payments from the state, warehousemen such as Buchheister are facing an uncertain future.
"Pride in Tobacco" says the sign that hangs in the Planters warehouse today. But pride won't pay the bills.
So last week, Buchheister, 60, was among a group of warehousemen who met in Charles County with officials implementing the buyout -- the fruits of the government settlement with tobacco companies in which farmers are paid $1 per pound not to grow tobacco, based on their average yield from 1996 to 1998.
The buyout resulted from a lawsuit settled in 1998 between the states and the tobacco industry. Maryland's share, expected to exceed $4 billion over 20 years, is being spent on health, education and other programs, but some is going to tobacco farmers who agree to give up growing the crop.
The warehousemen had hoped to get a piece of the action, but they learned they aren't eligible. They were told: Try the U.S. Small Business Administration instead.
"The state government bought out 80 percent of our business this year," Buchheister grumbled, referring to the payments to farmers. But as for the warehousemen, "They pretty much told us we're on our own."
While Buchheisterparticipated in that futile effort, he and brother Peter also spent time on the road paying visits to their longtime Mennonite and Amish growers in St. Mary's and Cecil counties. The two groups, whose religion bars them from receiving government funds, have no plans to stop growing tobacco, and competition among the warehousemen in Upper Marlboro, Waldorf and Hughesville for their business has been intense.
The Buchheisters were kept so busy "putting out fires," as John put it, they had to skip a nursery convention in Baltimore. There they'd hoped to learn the joys of diversifying as a means to economic survival.
Meanwhile, a "For Lease" sign hangs outside Planters, with the Buchheisters hoping to rent out at least the second warehouse, with about 22,000 square feet of floor space, to bring in some income. Inside the main warehouse, which is twice that size, tobacco is beginning to stack up, but barely.
"Usually, it'd be about three-quarters filled by now, in a normal year," Buchheister said. "It's just not a normal year anymore."
His great-grandfather, Heinrich Buchheister, and George Albrecht Buchheister, the son Heinrich sent here to learn about Maryland tobacco, would surely wonder what the world is coming to. In their day, tobacco was king, particularly so inPrince George's and Southern Maryland, where the leafy crop largely defined the region for 300 years.
Buchheister's grandfather came to this country around 1900 on what was to be a temporary mission: to learn about Maryland tobacco, then return to Germany to work in the family's tobacco-buying business. But like many immigrants, he decided not to go home. Living in Baltimore, he met and married a German girl. When World War I broke out, he moved to Prince George's -- then a rural patch of Southern Maryland -- to escape intense anti-German feelings in the city.
In 1917, he bought a large farm a few miles from UpperMarlboro, on a 250-acre tract that borders Watkins Regional Park and now belongs to the Maryland-National Capital Park and Planning Commission. The Buchheisters grew tobacco there, but mainly they were brokers for the crops of others. George Buchheister commuted on the old Pope's Creek Railroad line to his office in Baltimore, where most of the state's tobacco was sold.
The Baltimore market ended, however, as farmers demanded sales closer to home where they could receive their checks promptly as their crop was being auctioned. Thus were born the loose leaf markets that are now shrinking. John and Peter's father, Jimmy Buchheister, and his brother, Gus, built Planters in 1940-1941, and a second warehouse in back in 1951.
The job of the warehouseman is to act as the farmer's agent with the buyers, to weigh and handle the tobacco for sale and to position it on the warehouse floor. For this service, the warehouse commission is 4.5 percent of the gross.
John Buchheister was born Dec. 18, 1941, Peter five years later. From an early age, the brothers looked forward to the market season.
"To me, it was an exciting time. To some of the older people associated with [the market], the town was pretty much dead until the market and then things exploded for three or four months. All these people would come up from the South and local people would be hired." Eventually, there would be three different auction warehouses in Marlboro, and two companies that processed the crop for shipment after its sale.
Now, a gas-and-go and a McDonald's sit where the Edelen Brothers warehouse was near Planters. With the tobacco crop trucked to the Carolinas for processing, the companies that had processed it -- United Leaf and Gieske & Niemann are also gone.
This year's seven-day auction, spread over two weeks starting March 19, is the shortest on record.
John and Peter are well into middle age, and their children simply aren't interested in carrying on the family business. Between the two brothers, they have three daughters and one son, Peter's, who is a stockbroker in New York. He helped strip tobacco for market when he was growing up, "but in this day and age there's no future in it," John Buchheister said.
John and Peter sold the family farm to the park agency five years ago for $5 million. The Buchheisters wanted to lease it back to grow some tobacco, but the agency has a policy that that crop alone may not be grown on its land. Currently, the agency has 28 leases on 1,318 acres of land it owns, and grain is grown on the former Buchheister farm. John Buchheister said he suggested years ago that the agency also buy his warehouse and turn it into a tobacco museum, but the proposal was a non-starter.
"You know, it's politically incorrect," said Buchheister, who, like his brother, does not smoke but occasionally chews tobacco. "But it's like a lot of this land over here. When it's gone, it's gone."
In spite of the buyout, it's not gone yet, at least not completely. The Buchheister brothers bought another farm in the Croom-Naylor area, where they live and raise 15,000 to 20,000 pounds of tobacco on about 15 acres.
In recent weeks, the Buchheisters "went South" to meet with buyers and were assured, John said, of a demand this year for the Maryland crop, but with no guarantee for 2003. "They wouldn't tell because everything is in turmoil overseas with a German company [the largest European buyer of Maryland tobacco] up for sale, and the second largest doesn't buy U.S. tobacco," John Buchheister said.
"We're still in the tobacco business," he noted. "We just don't know what's going to happen."
The same holds true for other warehousemen, including Buchheister's nearby competitor, the Marlboro Tobacco Warehouse. "We're going to see how the market goes," said Hill Summers, one of the owners.
Said Buchheister, "We talk to all the warehouses. We call up and cry on each other's shoulders."
One county south, in Hughesville, the Farmers Tobacco Warehouse also has a "For Lease" sign. "The bottom line is I don't even know if I'll be here," manager Raymond Guy said. "Nobody can know for sure."
Next door, warehouseman Gilbert O. Bowling Sr., who uses one of his two buildings for an antiques flea market most of the year, bemoans the passing of tobacco.
"I'm old. I can do without it personally," he said. "I just hate to see something taken away from people when it's legal and people are still smoking. I know it's bad for your health, and if my doctor says to quit, I'll quit. But it's been here for a long time, supported the infrastructure, schools, 4-H, Little League. If I go out of business, I'll be out of supporting all those things. I've always said the death has occurred. Now, we're having visiting rights before the final burial."