U.S. Tobacco Can Compete

Kehaya says the U.S. has some advantages on world tobacco market.

Published on: Mar 4, 2013

With the political and social situation such as it is for tobacco, an objective observer would never say it is easy sailing for the tobacco industry in the U.S. But Mark Kehaya, chairman of the Board of Directors of Alliance One International, an international leaf purchasing, packing and shipping company headquartered in Morrisville, N.C., emphasizes there are some positive signs ahead for the U.S. tobacco industry.

Kehaya, who has had the opportunity to study international tobacco markets a great deal in his vocation, spoke at the Annual Meeting of the Tobacco Growers of North Carolina in Raleigh, February 1.

He asserted, even though there are many forces lined up against the industry, U.S. tobacco is well positioned and can grow in the current environment. It can "capture a larger share of the international market to more than offset the decline in domestic growth," he said.

EFFICIENT LABOR: Mark Kehaya, chairman of the Board of Directors of Alliance One International, an international leaf purchasing and logistics company based in Morrisville, N.C., says one of the advantages U.S. tobacco growers have over much of the rest of the worlds growers is more efficient use of labor. One reason for that might be the use of sophisticated equipment in this country.
EFFICIENT LABOR: Mark Kehaya, chairman of the Board of Directors of Alliance One International, an international leaf purchasing and logistics company based in Morrisville, N.C., says one of the advantages U.S. tobacco growers have over much of the rest of the world's growers is more efficient use of labor. One reason for that might be the use of sophisticated equipment in this country.

"…We, as an industry, need to keep investing. We need to keep working on becoming more efficient. At Alliance One we are committed to working with you side-by-side, the growers and with industry groups, to try and make sure you have a long-term sustainable future, and that we, as an industry, can keep growing in North Carolina."

Kehaya noted the customer base is changing and this will result in different tobacco quality requirements as well as greater product integrity.

The industry cannot rest on the status quo, he said.

On the other hand, the U.S. tobacco industry has a number of strengths to call on. He named a few.

First he said, the U.S. has efficient labor usage with tobacco.

"To give you some numbers," he noted, "in Africa, people use 1,200 man hours per acre of tobacco. In Brazil, they use just under 400 man hours. And in the U.S. the latest figures are 66 man hours of labor per acre of tobacco. Looking at that, it is easy to see you (growers) have a significant advantage from a labor standpoint."

He noted it is another advantage for U.S. growers that the sustainability of curing fuel is not a major issue for growers in this country.

A third big advantage for U.S. growers and processors is the fact that the supply chain is efficient in this country.