PROCESSING, STORAGE, AND SELECTED STORAGE SERVICE COSTS FOR 
MARYLAND TOBACCO IN COMMERCIAL FACILITIES, 1966/67 AND ESTIMATED 1968 
by 
N. A. Wynn, Agricultural Economist 
Marketing Economics Division 
Economic Research Service 
FINDINGS 
This report analyzes the costs of handling, processing, storage, and 
related services in commercial facilities handling Maryland tobacco during 
fiscal 1966/67 and presents estimates for 1968. 
The results are based on accounting records of three firms processing 
and three firms storing Maryland tobacco. These processing firms handled a 
total of 23.5 million pounds of green weight tobacco in 1966/67. Of this amount 
8.8 million pounds were redried with a yield of 94 percent. Redrying cost 
includes receiving tobacco into the plant, redrying it, packing it into hogsheads, 
and shipping it out. 
Costs were also developed for tobacco storage and storage services. 
Services included are innage, outage, sampling, reweighing and restoring, and 
reweighing while performing other services. 
Labor costs for 1966/67 were updated to reflect minimum wage changes 
effective February 1, 1968, and changes in other variable costs as of January 
1968. (See Methodology) 
Average survey period cost for redrying was $11.68 per hundredweight. 
When updated to 1968, this cost increased to $12.49. 
Storage costs were computed on the volume stored during the survey period. 
Storage warehouses operated at 122 percent of rated capacity during the survey 
period. At this rate of utilization, the average survey period cost was 41.13 
cents per hogshead per month, while the 1968 estimate was 42.99 cents. 
Necessary services to storing tobacco include innage and outage of the tobacco. 
The innage cost per hogshead for the survey period was $1.56 and the 1968 
estimate was $1.70. For outage these costs were $1.44 for the survey period 
and $1.57 for 1968. 
Cost for sampling, the most expensive service performed in the storage 
operation, amounted to $15.80 per hogshead for the survey period. When 
estimated for 1968, this cost averaged $17.28 per hogshead. 
Other services utilized by the industry in volume include reweighing. 
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