AMERICANS SHOP IN ONTARIO AGAIN

The Marlborough Man is shopping for tobacco in
Canada, and Ontario's flue-cured leaf growers are
hoping he'll end up taking 20 million pounds back
home with him.
Sales to the U.S. slowed to a trickle last year
after the U.S. Congress imposed a new rule forcing
cigarette makers to use at least 75-per-cent
American-grown leaf in packs sold in the U.S.
Now, President Bill Clinton has exempted Canadian
tobacco from the border blockade, thanks to a GATT
panel that ruled the provision was in fact a
non-tariff barrier. NAFTA prohibits the U.S. from
imposing such barriers against Canada.
Still, it could take three years to get U.S.
exports back to the 20-million-pound, pre-1994
level, predicts George Gilvesy, chairman of the
Ontario tobacco growers marketing board.
American buyers have been working the floors of
Ontario's two tobacco auctions since they opened
mid-October, and Gilvesy thinks the province's
1,200 tobacco farmers have grown a good-quality
crop that will draw bids from U.S. cigarette
giants.
"It's what we call a soft crop - it's very usable
in all stalk positions," Gilvesy says. "The
Americans typically buy filler-type leaf, and our
fillers are very good quality this year, but we're
also hoping to move them up the stalk a bit" to
higher-priced leaf grades.
Farmers are marketing 144 million pounds of 1995
flue-cured, and expect to gross nearly $300
million.
Quota allotments are based on expected domestic
consumption of 89.5 million pounds, and exports of
54.5 million.
In 1993, farmers grew 130 million pounds, with just
41 million pounds slated for export, because of
uncertainty at the U.S. border.
Now, Gilvesy thinks farmers can plan on growing
about 145 million pounds a year for several years
to come. Domestic buyers have signed a five-year
agreement that will see production targets set at
140 million pounds a year, plus or minus five per
cent..-TB   

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