Contents Summary Products U.S. Exports and Imports U.S. Tobacco Leaf Situation and Outlook Flue-Cured Burley Southern Maryland Fire-Cured Dark Air Cured Cigar Tobacco Summary Flue-cured tobacco markets closed on November 22nd. The 2002 crop was marred by drought over wide areas of the belt and disease in Georgia, Florida, and the Northern Area. Producer sales totaled 564.8 pounds, representing 97 percent of the 2002 effective quota, and included an estimated 104.5 million pounds of carry- over tobacco from 2001 production. Producer sales at auction totaled 115.2 million pounds and contract sales totaled 446.1 million pounds. Gross auction sales totaled 119.9 million pounds, and averaged $175.72 per hundredweight compared with $182.46 the previous season. Contract center sales averaged $184.33 per hundredweight, down $2.38 from the previous season. Total flue- cured gross sales for the season reached 566.1 million pounds and returned an average of $182.50 per hundred. Last season, gross sales of 554.6 million pounds averaged $185.84 per hundredweight. The 2002-2003 burley tobacco marketing season began Monday November 11th as contract centers began accepting deliveries. Burley auction sales opened November 18th. Grade averages for the first week were higher than last season from the start although loan receipts were higher also. As of October 1st, the burley crop is estimated at 303.6 million pounds, 9 percent below last season’s 334.1 million pounds. As of October 1, total tobacco acreage for the 2002 marketing year was estimated to have declined .4 percent from 2001 to 434,310 acres. Yields slipped, reaching 2,040 pounds per acre for all types of tobacco, compared with 2,293 in 2001. Dry weather and disease reduced yields in many tobacco growing areas. Production of all types is estimated at 886.0 million pounds, about 105 million pounds below last season. Based on October 1 estimates, 94 percent of U.S. leaf were types used for cigarettes, up slightly from last season. Cigar leaf, also used for other products such as chewing and smoking tobacco, accounted for 2 percent of production. Other types, mostly dark air- and fire-cured leaf, accounted for 4 percent of production. The 2003/04 flue-cured marketing quota was announced on December 16, 2002. The burley marketing quota is to be announced by February 1, 2003, and acreage allotments for other types of tobacco under quotas are to be announced by March 1, 2003. Unmanufactured tobacco exports were down 17 percent during the January-September period, compared with last year. Shipments were 243 million pounds compared with 294 million pounds during the same period in 2001. Value declined 13 percent as export unit values increased slightly. Flue-cured shipments fell 15 percent and burley slipped 4 percent. All other categories fell at least 15 percent. Calendar year exports are projected down at least 15 percent by year end. Higher U.S. leaf prices continue to erode foreign demand. Total 2002 exports will probably be near 360 million pounds, compared with last year's 411 million pounds. Unmanufactured tobacco imports (consumption) for January- September 2002 surged 23 percent, compared with the same period in 2001, reaching 458 million pounds. Last year, imports slipped slightly during the same period. General imports gained 8 percent during January-September 2002 reaching 442 million pounds, compared with 408 million pounds last year. Stocks of imported cigarette leaf were nearly unchanged on October 1, 2002 compared with a year earlier at 763 million pounds. U.S. cigarette output in 2001 is expected to change little from the previous year, at about 580 billion cigarettes. Domestic consumption is expected to fall just over 1 percent to 420 billion cigarettes. During the first 9 months of 2002 96.3 billion cigarettes were exported. If this trend continues during the fourth quarter, cigarette exports could be near 110 billion for calendar 2002, the lowest since the mid-1980's. During January-September, cigarette imports advanced to 15.0 billion pieces compared with 9.9 billion last year. Products U.S. Cigarette Consumption in 2002 Estimated at 420 Billion Pieces Cigarette consumption in 2002 is estimated at 420 billion pieces, compared with 425 billion in 2001. The decline of just over 1 percent is similar to declines during the past 3 years. U.S. Department of Treasury data for output, taxable removals, and non-taxable removals are not yet available for 2001 and 2002. Estimates of output and taxable removals are subject to revision. Cigarette Prices Increase The Bureau of Labor Statistics cigarette Consumer Price Index (CPI) shows retail prices of cigarettes 10 percent higher in September compared with a year earlier. Last year's increase was 9 percent. Retail prices for cigarettes in 2002 will likely be about 8 percent higher than 2001. Prices advanced 8 percent the previous year, according to the year-end CPI for cigarettes. Manufacturers raised wholesale cigarette prices twice in 2001. Through the end of November 2002, manufacturers had raised wholesale cigarette prices only once in 2002. Wholesale prices increased $6.00 per thousand cigarettes or 12 cents per pack in April. The wholesale price for premium cigarettes is $138.20 per thousand ($2.76 per pack), including Federal excise tax and $118.70 per thousand ($2.37 per pack) without Federal excise tax. The Federal excise tax has been 39 cents per pack since January 1, 2002. Currently, State taxes range from 2.5 cents per pack in Virginia to $1.50 in New York State (New York City’s tax is an additional $1.50). Hawaii, Nebraska, and Oregon have enacted taxes set to take effect before the end of 2002. Hawaii increased its tax 20 cents to $1.20 per pack effective in October. Nebraska increased its tax 30 cents to 64 cents per pack in October. Oregon increased its tax 60 cents to $1.28 per pack, effective November 2002. Vermont has enacted a tax increase of 26 cents per pack effective July 2003, making its tax $1.19 per pack. Kansas will increase its tax by 9 cents per pack to 79 cents per pack in July 2003 and Hawaii’s excise tax is set to increase 20 cents per pack to $1.40 cents per pack in July 2004. Cigarette Trade Cigarette exports peaked in 1996 at 244 billion pieces. During the first 9 months of 2002 96.3 billion cigarettes were exported. If this trend continues during the fourth quarter, cigarette exports could be near 110 billion cigarettes for calendar 2002, the lowest since the mid-1980s. Last year, exports totaled 133.9 billion pieces. Japan, Saudi Arabia, the European Union, and South Korea were the major markets for U.S. cigarettes. During January-September, cigarette imports were 15.0 billion pieces compared with 9.9 billion last year. Cigarette imports have surged as manufacturers not subject to Master Settlement Agreement payments have imported increasing numbers of cigarettes. Cigar Consumption Edges Downward For 2002, early estimates based on limited data indicate cigar consumption will slip to 3,833 billion cigars. Output and taxable removal data are not yet available for the second half of 2001 and 2002. Large cigar consumption during 2001 increased to an estimated 3,941 million cigars, compared with 3,850 million in 2000. Imports of cigars during January-September 2002 slipped 22 percent compared with the previous year. Year-end imports are expected to be around 400 million cigars. Exports through September reached 198 million cigars compared with 89 million cigars during the same period in 2001. Canada and Lebanon accounted for over half the shipments, with Lebanon accounting for most of the gain from last year. Other Tobacco Products Output of chewing tobacco during January-September 2002 was 34.6 million pounds. Production slid 4 percent from the same period last year, continuing its steady decline. January-September output fell for all classes of chewing tobacco, firm, moist, twist, and leaf, with the greatest decline in moist chewing. Estimated output for calendar 2002 is 45.1 million pounds. Taxable removals (domestic invoices) of chewing tobacco through September were 32.6 million pounds, 8 percent below the same period last year. Total taxable removals for 2002 are projected at 42.9 million pounds compared with 46.6 million in 2001. As with other smokeless and smoking tobaccos, taxable removals are very close to actual consumption. Smoking tobacco peaked in 1999 at 14.7 million pounds and then declined for two years. However, January-September output has outpaced the same period last year by 26 percent. If this pace continues through the fourth quarter, output of smoking tobacco will reach 16 million pounds. Both cut (used for roll-your-own cigarettes) and pipe smoking output increased during the January- September period. Through September, 11.1 million pounds of smoking tobacco were manufactured compared with 10.8 million pounds the previous year. January-September taxable removals of smoking tobacco advanced 7 percent this year. Pipe smoking tobacco taxable removals declined while cut smoking advanced. Snuff has been a consistent growth segment for the smokeless tobacco industry. Output during the first 3 quarters of 2001 advanced 3 percent. The 9-month total reached 55.1 million pounds compared with 52.5 million during the 9-month period last year. Year-end output is expected to be about 74.3 million pounds, up 5 percent. Taxable removals for January-September gained 3 percent compared with a year earlier--totaling 53.7 million pounds. Year- end taxable removals are projected at 71.8 million pounds. U.S. Exports and Imports Leaf Exports Down Sharply This Year Unmanufactured tobacco exports were down 17 percent during the January-September period compared with a year earlier. Shipments were 243 million pounds compared with 294 million pounds during the same period in 2001. Value declined 13 percent as export unit values increased slightly. Flue-cured shipments fell 15 percent and burley slipped 4 percent. All other categories fell at least 15 percent. Calendar year exports are projected down at least 15 percent by year end as higher U.S. leaf prices continue to erode foreign demand. Total 2002 exports will probably be near 360 million pounds, compared with last year's 411 million pounds. January-September exports of flue-cured leaf totaled 99 million pounds or 41 percent of total leaf shipments, compared with 40 percent last year. The flue-cured component of total exports has been shrinking during the past 5 years. Shipments of 99 million pounds were down 18 million pounds. Top destinations were Germany, Japan, Belgium, South Korea, and Malaysia. These five countries all purchased more than 5 million pounds during the 9- month period and accounted for 58 percent of shipments by volume. Forty-nine countries bought U.S. flue-cured during January- September 2002. Burley leaf shipments slipped 4 percent in volume, reaching 78 million pounds during the 9-month period from January-September 2002. Burley shipments have been gaining as a component of total leaf exports, reaching 32 percent of total export volume during the January-September period. Maryland leaf exports slid 30 percent during the January- September period compared with a year earlier. Shipments totaled 1.8 million pounds. Shipments of Kentucky-Tennessee dark fire- cured declined after 2 years of growth, reaching 9.7 million pounds. During the same period last year, shipments were 14.7 million pounds. The Netherlands, Indonesia, and Sri Lanka were the top buyers of Kentucky-Tennessee fire cured leaf. Stems, Connecticut wrapper, cigar binder, Virginia fire- and sun-cured leaf, and ‘other tobacco’ all slipped. Among major markets, volume to the European Union (EU) slipped by 25 percent during the January-September period, accounting for 51 percent of export volume, slightly less than last year. Overall, Germany was once again the largest purchaser at 47 million pounds, and Belgium followed with 20.6 million pounds. Malaysia, Denmark, the Netherlands, and Switzerland were the next largest buyers, accounting for 56 percent of U.S. leaf exports. There have been no exports under U.S. Department of Agriculture (USDA)- financed programs since 1993. Imports for Consumption Advance 23 Percent Unmanufactured tobacco imports (consumption) for January- September 2002 surged 23 percent compared with the same period in 2001, at 458 million pounds. Last year, imports slipped slightly during the same period. Imported leaf stocks are at historically low levels and the increase in imports may indicate stocks are being replenished. In addition, imported leaf use in U.S.- manufactured cigarettes continues to advance, driving increased imports. Oriental leaf imports were nearly steady at 104 million pounds compared with 108 million pounds the previous year. Flue-cured imports advanced 18 percent to 94 million pounds during the 9- month period. Imports of stemmed ‘not specifically provided for’ leaf (mostly burley) gained 30 percent to 105 million pounds. Cigar leaf shipments slid 12 percent. After a sharp decline last year, imports of stems more than doubled, reaching 97 million pounds. General imports of unmanufactured tobacco gained 8 percent during January-September 2002 reaching 442 million pounds, compared with 408 million pounds last year. General imports of Oriental leaf slipped by 22 percent and stemmed flue-cured gained 20 percent. Burley leaf imports (as indicated by the stemmed ‘not specifically provided for’ category which is mostly burley) gained 18 percent. General imports of stems advanced 50 percent to 83 million pounds. Cigar wrapper shipments gained while filler slipped 14 percent. Overall, cigar tobacco fell 12 percent to 42 million pounds. Imported Leaf Stocks Stocks of imported cigarette leaf were nearly unchanged on October 1, 2002, compared with a year earlier at 763 million pounds. Flue-cured leaf stocks were steady at 281 million pounds. Burley leaf stocks gained 2 percent and ended at 275 million pounds. Stocks of Oriental leaf slipped 4 percent to 199 million pounds. Cigarette leaf stocks are lower than traditional levels. Prior to 1999, cigarette leaf stocks were usually over 1 billion pounds. Cigar leaf stocks slid 3 percent compared with a year earlier, ending at 95 million pounds. Tariff-Rate Quota The tobacco TRQ year begins on September 13 and runs through September 12 the following year. The tariff rate quota (TRQ) for 2002-03 on cigarette tobacco leaf imports (excluding Oriental) was 15 percent filled as of December 9, 2002. The total quantity allowed under the TRQ is 332.2 million pounds. During the 2001-02 TRQ year, 74 percent of the quota, or 244.4 million pounds, were imported under the quota. U.S. Tobacco Leaf Situation and Outlook -----1/ ----- 1/ All quantities in this section are in farm-sales weight unless otherwise noted. Years refer to marketing years; July-June for flue-cured and cigar wrapper (type 61) and October-September for all other types, unless otherwise noted. ----- Based on October 1 estimates, tobacco acreage for the 2002 marketing year increased less than 1 percent to 434,310 acres from 2001. Yields slipped, reaching 2,040 pounds per acre for all types of tobacco, compared with the 2,293-pound yield of 2001. Drought and disease had widespread impacts on volume and quality. Production in 2002 is estimated at 866 million pounds, about 105,000 pounds below last season. Ninety-four percent of U.S. leaf produced was used for cigarettes. Cigar leaf, also used for other products such as chewing and smoking tobacco, accounted for 2 percent of production. Other types, mostly dark air- and fire- cured leaf, accounted for 4 percent of production. Marketing Quota and Allotments in 2002 The five domestic cigarette manufacturers (those with more than 1 percent of U.S. production and sales) are required to submit a statement of flue-cured and burley purchase intentions to the Secretary of Agriculture 15 days before the national quota announcement deadline. The flue-cured quota is announced by December 15th (December 16th this year). Manufacturers submitted 2003 purchase intentions for flue-cured tobacco totaling 283.3 million pounds. Burley purchase intentions are due by January 15, 2003. Marketing quotas for flue-cured and burley in 2003 are set by totaling (1) intended purchases by domestic cigarette manufacturers from the 2003 crop; (2) average exports for the 2000/01, 2001/02, and 2002/03 marketing years; and (3) an adjustment to maintain loan stocks at the lower of either 10 percent of the basic quota, or 60 million pounds of flue-cured or 50 million pounds of burley. The Secretary of Agriculture may adjust this three-part total by up to 3 percent, up or down. Legislation passed in 2000 and 2001 excludes 1999 crop loan stocks from the quota calculations by forgiving Commodity Credit Corporation (CCC) loans for this tobacco. The national marketing quota for the 2003 crop is 526.3 million pounds, down 10 percent from the 2002 quota of 582 million pounds and is based on the following: (1) purchase intentions by domestic cigarette manufacturers of 283.3 million pounds (2) unmanufactured exports (average for 3 years 2000, 2001, and 2002) of 254.7 million pounds, and (3) a reserve stock adjustment of 11.7 million pounds. The Secretary of Agriculture made no discretionary adjustment. The effective quota is expected to be about 540 million pounds, or 6 percent less than 2002. The national average yield goal remains unchanged at 2,088 pounds per acre. The price support level for the 2003 crop is $1.663 per pound, up .7 cent per pound from 2002. The national acreage allotment for the 2003 crop is 252,059 acres, 9.6 percent below the 2002 allotment of 278,736 acres. For each farm, the 2003 basic quota will decrease approximately 9.5 percent from 2002. By February 1, 2003, USDA will announce the 2003 burley poundage quota, and by March 1, USDA will announce the 2003 acreage allotments for other kinds of tobacco under the quota program. Price Supports in 2003 The 2003 price supports for flue-cured and burley (set at the same time quotas are announced) are the preceding year's support adjusted by changes in the 5-year moving average of prices, excluding the highest and lowest years (two-thirds weight) and changes in a cost-of-production index (one-third weight). Costs include variable expenditures, but exclude costs of land, quota, risk, overhead, management, marketing contributions, and other items not directly related to tobacco production. The Secretary of Agriculture has discretionary authority to adjust the price support between 65 and 100 percent of the calculated increase or decrease. The 5-year moving average of prices and changes in a cost-of-production index increased the price support for flue-cured. The 2002 flue-cured and burley supports were raised by 100 percent of the formula increase. For supported types other than flue-cured and burley, maximum increases in supports will continue to be based on changes in the average parity index during the 3 previous years compared with 1959. Loan associations can request reduced support if market conditions warrant. U.S. Industry Submits Purchase Intentions of 283.3 Million Pounds for 2003 Flue-Cured Tobacco U.S. cigarette manufacturers submitted purchase intentions of 283.3 million pounds for the 2003 flue-cured crop (July 2003-June 2004), the lowest since intentions were first submitted in 1986. Purchase intentions were 9 percent below last year’ 310.0 million pounds and 2.7 million pounds below the 2000 crop year intentions, the second lowest. Burley purchase intentions are due by January 15, 2003. The Agricultural Adjustment Act of 1938 requires each major domestic cigarette manufacturer to purchase an amount equal to at least 90 percent of its stated purchase intentions to avoid the assessment of a penalty. In past years, purchases have declined due to lower cigarette production and increased use of imported tobacco leaf. Purchase intentions are added to the 3-year average exports and the reserve stock adjustment to determine the basic flue-cured marketing quota. Flue-cured Tobacco Flue-cured tobacco markets closed on November 22nd. The 2002 crop was marred by drought over wide areas of the belt and disease in Georgia and Florida and the northern area. Tobacco companies showed only moderate buying interest for the tobacco sold at auction, resulting in a high percentage going under loan. Southern area auctions opened July 30th and closed October 24th. Ten warehouses held auctions in the southern area. Thirteen auction markets operated in the Northern Area, for a total of 62 sales days, 4 more than last year. Northern auctions opened July 31st and closed November 21st. The Flue-Cured Stabilization Corporation operated 14 of the 40 auction warehouses as marketing centers. Forty-three contract centers operated in 27 markets for a total of 91 sales days, nine more than last year. In the southern area, contract centers opened July 8th and closed October 23rd. Contract centers opened July 8th and closed November 15th in the northern area. Producers' or net sales totaled 564.8 pounds, representing 97 percent of the 2002 effective quota, and included an estimated 104.5 million pounds of carryover tobacco from 2001 production. Producer sales at auction totaled 115.2 million pounds. Contract sales totaled 446.1 million pounds and non-auction sales by producers (aside from contracted leaf) totaled 3.4 million pounds. Gross auction sales totaled 119.9 gross pounds, and averaged $175.72 per hundredweight (cwt) compared with $182.46 the previous season. Contract centers received 446.1million pounds for the season and averaged $184.33 per cwt, down $2.38 from the previous season. Total flue-cured gross sales for the season reached 566.1 million pounds and returned an average of $182.50 per hundred. Last season, 554.6 million pounds averaged $185.84 per hundred. Burley Tobacco The 2002-2003 burley tobacco marketing season began Monday, November 11th as contract centers began accepting deliveries. Burley auction sales opened November 18th. Grade averages for the first week were higher than last season from the start, although loan receipts were also high. Bid averages improved after the second week of auctions and loan receipts stayed high. Through December 20th, gross sales totaled 220.4 million pounds, 38.1 million pounds less than before Christmas last season. Auctions accounted for 90.5 million pounds of sales and contract sales accounted for 161.3 million pounds. Contract sales comprised 73 percent of total sales. Leaf quality during the 2002 marketing season has suffered from poor growing conditions, mainly drought. Price supports for the 2002 crop average $1.835 per pound, up .9 cent per pound from the 2001/02 season. Loan rates by grade range from $.85 to $2.08 per pound. Pre-holiday auction sales ended on December 19th and sales are scheduled to resume on January 6, 2003. Contract sales continued through December 20th and resume also January 6th. Final sales are set for February 20, 2003. There were 19 auction sales days during the pre-holiday period, one more than last season. Before the break, gross auction sales totaled 59.1 million pounds averaging $196.14 per cwt. Last season, pre-holiday sales totaled 90.5 million pounds averaging $194.88 per cwt. Pre-holiday loan receipts totaled 18.7 million pounds, or 33 percent of net sales, compared with 6.2 million pounds or 7 percent last season. Contract sales before the holidays reached 161.3 million pounds after 28 days of sales. Prices averaged $199.99 per cwt. Last season, pre-holiday contract sales were held for 37 days during which 168.0 million pounds were sold. Prices averaged $199.10 per cwt. Total gross burley sales (auction and contract) before the holidays reached 220.4 million pounds averaging $197.93 per cwt. Net sales totaled 217.9 million pounds, or 72 percent of the October crop estimate. Last season, gross sales prior to the holidays were 258.5 million pounds selling for $197.63 per cwt. Net sales were 252.4 million pounds, or 71 percent of the crop. Disappearance Declines During 2001/02 During the marketing year beginning October 1, 2001, and ending September 30, 2002, disappearance of burley leaf slipped 50 million pounds from the previous season. Domestic use was 246 million pounds. Exports of 140 million pounds were only 2 million pounds below the previous season. Carryover on October 1, 2002 is 43 million pounds lower than the previous season. Expected marketings of about 300 million pounds will result in supplies of 950 million pounds, about the same as the previous year. This 2002 season’s effective farm poundage quota was 2 million pounds above 2000/01. Growers planted 6,000 fewer acres, and yields were 8 percent lower than a year earlier. Disappearance exceeded marketings in 2001 by 43 million pounds. Manufacturers holdings slid by 54 million while loan stocks rose to 131 million pounds. The 2002/03 supply is about 2.45 times likely disappearance, close to traditional levels. Use in 2002 is expected to decline slightly. USDA To Announce 2003 Quota by February 1 USDA must announce the 2003 burley quota by February 1, 2003. The three components of the quota, manufacturer’s purchase intentions, previous 3 year’s exports, and reserve stock adjustment, can be further adjusted up or down 3 percent at the discretion of the Secretary of Agriculture. Southern Maryland During the year ending September 30, 2002 (crop year 2001), disappearance of Maryland tobacco is estimated at 7.8 million pounds (based on January 1 stocks), compared with 17.1 million pounds a year earlier. Both domestic use and exports declined more than half. After dropping 60 percent in 2001, 2002 production slid 10 percent to an estimated 4.8 million pounds. January 1 stocks are estimated to be 7.2 million pounds, compared with 9.7 million pounds the previous season. Supplies in 2001 have plummeted to 12.0 million pounds, 3 million pounds below 2001. Supplies of Maryland leaf have been decimated by the State- sponsored buyout in Maryland. Production in Maryland in 2002 is expected to be 2.4 million pounds and, for the first time, is actually lower than Maryland leaf production in Pennsylvania. Production of Maryland leaf in Pennsylvania increased from 2.0 million pounds in 2001 to an estimated 2.4 million pounds in 2002. Fire-Cured Auctions for Virginia fire-cured (type 21) opened December 4th. Prices during the first week of sales were $170.4 per cwt, 20 cents below last season. The October 1 production estimate is 1.3 million pounds, 42 percent below 2001 and the lowest level in the post-war era. Acreage is forecast at 700 acres, compared with 1,200 acres last season. Yields are unchanged. Disappearance in 2001 (October 2001-September 2002) was 1.5 million pounds, compared with 1.8 million pounds last season. Supplies for 2002 are estimated at 6.1 million pounds, compared with 6.4 million pounds in 2001. Lower production was offset by higher manufacturers’ stocks, resulting in higher supply. Total beginning stocks were 4.8 million pounds on October 1, 2002. Auctions for Kentucky-Tennessee fire-cured (type 22-23) open in mid-January. Production in 2002 is estimated at 30.9 million pounds compared with 43.1 million pounds in 2001. Both yields and acreage are lower this season. Loan stocks on October 1, 2002, were 8.7 million pounds compared with 4 million pounds a year earlier. Total beginning stocks of 99.5 million pounds are 6 million pounds higher than last season. Supplies in 2002 are down 6 million pounds due to lower production. Estimated supplies in 2002 represent 3.5 years use, based on the past five seasons. Disappearance Slips After reaching 43.1 million pounds last season, disappearance of fire-cured (types 22-23) slipped 5.7 million pounds to 37.4 million pounds during the 2001-2002 season. Domestic use increased to 24.0 million pounds and exports shrank to 13.3 million pounds. Stocks on hand equal about 3.5 years use based on the last 5 seasons. Dark Air-Cured October 1st estimates indicate 3,900 acres of dark air-cured (types 35-36) tobacco will be harvested in the 2002-03 season (October 2002-September 2003), 1,070 acres less than 2001. With lower yields also, production is expected at 10.1 million pounds, compared with 13.9 last season. After slipping below 10 million pounds during much of the late 1990s, production rebounded, peaking at nearly 16 million pounds in 2000. Stocks of dark air- cured equal about 3.5 years of use, based on the past five seasons. The 2002-2003 One Sucker (type 35) tobacco marketing season began Monday, December 2nd in Springfield, Tennessee. Initial volume was fairly heavy, and very little (if any) tobacco was observed being placed under loan through the second week of sales. Last season on opening day, 318,000 gross pounds had averaged $165.09 per hundredweight. Producers’ sales last year amounted to 5.1 million pounds and averaged $149.02 per hundredweight, with 31 percent of net sales placed under loan. Based on the latest crop estimate, the Type 35 production is expected to be around 7.4 million pounds. The 2002 Green River (type 36) season opened December 3, 2002, with sales of 323,624 pounds averaging $1.97 per pound, 24 cents higher than last year. Demand was better than last season although quality was lower. Growers placed 6,628 pounds, or 2.1 percent of gross sales into the loan program through the second week, compared with 10.9 percent at the same point last year. The latest crop estimates put the type 36 crop at 2.6 million pounds, compared with 4.3 million last season. For the 2001-02 marketing year (October 2001-September 2002), disappearance of dark air-cured tobacco (types 35-36) was 8.4 million pounds, compared with 9.8 million pounds in 2000. Both domestic and export use declined. Cigar Tobacco Disappearance Slips U.S. cigar tobacco disappearance during the 2001 marketing year (July-June for cigar wrapper leaf and October-September for other cigar types) rebounded from the previous season’s all-time low. Disappearance of 14 .3 million pounds was an improvement over the previous season’s 10.7 million pounds--the lowest since the 19th century. Exports continued their slide, falling to 1.4 million pounds while domestic use reached 13 million pounds. According to October 1 crop estimates, 2002 production is projected at 13.5 million pounds, 1 percent below last season but 31 percent higher than 2000. Beginning stocks are 24.6 million pounds, the lowest on record. Low production in recent years has forced manufacturers to draw down stocks. Supplies in 2002 are estimated at 38.0 million pounds compared with 38.9 million pounds in 2002. According to October 1 crop estimates, 2002 production of Pennsylvania filler (type 41) will be 4.4 million pounds, compared with 4.1 million pounds last season. Beginning stocks are also up slightly. Resulting supplies this season are expected up 500,000 pounds to 16.7 million. Disappearance of Pennsylvania filler during 2001 advanced to 4.0 million pounds after reaching only 2.5 million pounds in 2000. Exports were negligible. Many growers of Pennsylvania filler tobacco often grow Maryland type 32 instead. Growers also grow low-nicotine tobacco under contract. As of October 1, binder production for 2002 is estimated at 7.9 million pounds compared with 7.4 million in 2001. Acreage has increased from 3,710 to 4,000. In 2000, binder acreage slipped to 1,840 acres. Although yields will be slightly lower this season, higher acreage will result in a larger harvest. Connecticut Valley binder (type 51) will increase by 60 acres. Production of Connecticut Valley Binder is estimated at 3.9 million pounds, about half of total binder production. The 2002 Wisconsin binder crop is projected larger at 4.0 million pounds, compared with 3.6 million pounds last season. Acreage is up for both Southern and Northern binder and totals 1,800 acres, up 15 percent from 2001. For the 2001 marketing year, ending September 30, 2002, binder leaf disappearance recovered, reaching 9.0 million pounds, compared with 6.7 million pounds in 2000. However, binder use is at historically low levels. Supplies of Connecticut Valley Binder are still recovering from the disastrous 2000 crop. The October 1 crop estimate sets wrapper leaf production at 1.2 million pounds compared with 2.1 million last season. Acreage slid from 1,300 acres last season to only 950 this season. Production is expected to be 1.2 million pounds, about 900,000 pounds below last season. With beginning stocks at 1.8 million pounds, supplies of cigar wrapper leaf should be 3.0 million pounds, 257,000 pounds over 2001. For the 2001 season (July 2001-June 2002), disappearance slipped about 50,000 pounds to 1.4 million pounds compared with 1.5 million the previous season. Domestic use increased slightly and exports slipped.