POTENTIAL FOR ALTERNATIVE AGRICULTURAL ENTERPRISES TO REPLACE TOBACCO: BURLEY PRODUCERS PERCEPTIONS

Demand for domestic tobacco has decreased over the past two decades. In 2004, the tobacco buyout program terminated marketing quotas and price support established under the federal tobacco program in 1938. Additionally, in 2003, the World Health Organization Framework Convention on Tobacco Control (WTO FCTC) acknowledged the importance of supply control in conjunction with demand control strategies to eliminate or reduce the consumption of tobacco products. According to the Census of Agriculture, the number of tobacco farms in the US fell by 40 percent between 2002 and 2007. Tobacco farmers are looking for alternative on-farm and off-farm sources of income. This study uses a rank-ordered logit model (ROLM) to explore factors affecting farmers’ perceptions about the potential for grain crops, cotton, peanuts, hay, fruits and vegetables, cow/calf, dairy, beef cattle and, other crops/livestock to replace tobacco production. Results suggest that hay is one of the on-farm enterprises perceived as having the highest potential to replace tobacco among burley tobacco farmers. Age, education, farm size and farm cash receipts were found to affect farmers’ perceptions about the potential for different alternative enterprises to replace tobacco. Additionally, results suggest that researchers should be careful when designing ranking questions in order to maximize rate of response and quality of the data obtained from this type of questions.