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Post-Buyout Structural Change in the Peanut and Tobacco Sectors

Author

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  • Dohlman, Erik
  • Foreman, Linda F.
  • Da Pra, Michelle

Abstract

When longstanding marketing quota systems were eliminated (“bought out”) in 2002 for peanuts and 2004 for tobacco, producers lost quota-related price supports and other quota system protections, and were exposed more directly to a market-oriented system. The nature of the peanut and tobacco marketing quota programs, the structure and magnitude of the buyouts, and market dynamics influenced the ensuing structural changes that occurred at the farm, regional, and aggregate market levels. Analysis of USDA’s Agricultural Resource Management Surveys (ARMS) on peanut and tobacco producers over a multi-year timeframe provides insights on, and a basis for comparing and contrasting the buyout impacts along multiple dimensions. Notable developments include a consolidation in the number and increased scale of farms, regional shifts in production regions, and increased use of contracting to manage price risk.

Suggested Citation

  • Dohlman, Erik & Foreman, Linda F. & Da Pra, Michelle, 2010. "Post-Buyout Structural Change in the Peanut and Tobacco Sectors," 2010 Annual Meeting, February 6-9, 2010, Orlando, Florida 56355, Southern Agricultural Economics Association.
    • Handle: RePEc:ags:saea10:56355
    DOI: 10.22004/ag.econ.56355
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    File URL: https://ageconsearch.umn.edu/record/56355/files/SAEA%20paper%20_peanut%20tobacco_.pdf
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    References listed on IDEAS

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    1. A. Blake Brown & Randal R. Rucker & Walter N. Thurman, 2007. "The End of the Federal Tobacco Program: Economic Impacts of the Deregulation of U.S. Tobacco Production," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 29(4), pages 635-655.
    2. Dohlman, Erik & Foreman, Linda F. & Da Pra, Michelle, 2009. "The Post-Buyout Experience: Peanut and Tobacco Sectors Adapt to Policy Reform," Economic Information Bulletin 56628, United States Department of Agriculture, Economic Research Service.
    3. Dohlman, Erik & Foreman, Linda F. & Da Pra, Michelle, 2009. "Removal of Government Controls Opens Peanut and Tobacco Sectors to Market Forces," Amber Waves:The Economics of Food, Farming, Natural Resources, and Rural America, United States Department of Agriculture, Economic Research Service, pages 1-8, December.
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    Cited by:

    1. Hu, Wu-Yueh & Vukina, Tomislav & Zheng, Viaoyong, 2014. "The Role of Risk and Risk-Aversion in Adoption of Alternative Marketing Arrangements by the U.S. Farmers," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 168930, Agricultural and Applied Economics Association.

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    Keywords

    Agricultural and Food Policy;

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