- 8 - 



If half of 6 billion cigars were made with processed binders, the total 

 tobacco required would decrease from 53*6 million pounds to either 51.4 or 50. 7 

 million pounds, under the assumptions made. The tobacco to be sorted would de- 

 cline from 4-0.6 million pounds to 24.1 million pounds. Unsorted stemming tobac- 

 co would be expected to increase from 13.0 million pounds to 19.8 million, farm 

 sales weight, and it would require 6.8 million pounds of unsorted processing 

 tobacco if 0.9 pound of tobacco were used per pound of processed binder, and 

 7.5 million pounds using 1.0 pound of tobacco per pound of processed binder. 

 The quantity of unsorted tobacco required would increase with the increase in 

 the use of processed binders, not only for that use but to replace the throw- 

 outs and cuttings used in scrap chewing tobacco. 



Returns to Growers 



Table 3 compares the returns to growers of binder types under the three 

 situations shown in table 2. The average price for types 51, 52, and the binder 

 lots of type 55 > from which most natural binders come, was 46.5 cents for the 

 crop years 1950-54. Prices for Southern Wisconsin, type 54, averaged 23 cents 

 for that period and 26 cents for the 1956 crop. This type goes mostly for scrap 

 chewing. The lower supply of stemming tobacco from the loss of cuttings and 

 throwouts increased the price of Southern Wisconsin to 26 cents for the 1956 

 crop. The growers might be expected to - receive a total of 22.7 million dollars 

 if all the 6 billion cigars had natural binders, and 18.8 or 18.6 million dollars 

 if half the cigars had processed binders. The significant shift expected would 

 be the reduction in returns for tobacco to be sorted, from 19 '7 million dollars 

 to 11.7 million dollars. The tobacco sold that is not to be sorted would be ex- 

 pected to increase in value from 3 million dollars to 6.9 or 7-1 million. 



Table 3« — Estimated returns to growers for binder-type tobacco with 6 billion 

 cigars manufactured, with all natural binders and with half processed and 

 half natural binders 1/ 





: All natural 

 binders 



: 



Half 



natural bind" 



?rs 





Commodity 



: 56^ 



basis 



1/ 



: 6?{, 



basis 



1/ 





Price : 



Amount 



•.Value 



: Price : 



Amount 



fValue 



: Price: 



Amount 



fValue 



Stemming (unsorted) . . . 

 Processing (unsorted).. 

 Sorting (to be sorted). 



: Cts. 

 23.0 

 48.5 



Mil. 

 lbs. 



13.0 

 40.6 



Mil. 

 Pol. 



3.0 

 icj.7 



Cts. 



26.0 

 26.0 

 46.5 



Mil. 

 lbs. 



19.8 



6.8 



24.1 



Mil. 

 Pol. 



5.1 

 1.8 



H.7 



Cts. 



26.0 

 26.0 

 46.5 



Mil. 

 lbs. 



19.8 



7.5 



24.1 



Mil. 

 Pol. 



5-1 

 2.0 



H.7 



Total or average .... 



39.7 



53.6 



22.7 



36.7 



50.7 



18.6 



36.6 



51.4 



18.8 



1/ The pounds and bases therefor are from table 1. The prices are not in- 

 tended as estimates of the prices that actually would prevail. They are within 

 the range that can be expected under the assumptions given. 



