30 CIRCULAR 100, U. S. DEPARTMENT OF AGRICULTURE 



ence and passed on from generation to generation. Usually the sus- 

 ceptibility of the tobacco plant to the influence of soil and climate 

 retards or even prohibits the cultivation of a type of tobacco in a 

 given locality different from the type already grown, and hinders 

 a given locality in adjusting the type to the changing requirements 

 of the market. 



Low farm incomes have a tendency to cause many people to leave 

 the farm, especially the young people. From 1910 to 1925 the farm 

 population of the three States decreased 105,045. For the 5-year 

 period 1920 to 1925 the decrease was 301,409, or over 8 per cent. 

 Low farm incomes make farm life unattractive and hinder progress 

 and improvement. As a final result of low farm incomes the type of 

 farmers and standards of living of the farming population tend to 

 be constantly lowered as compared to that of the urban population. 



FAEM CREDIT 



With one or two seasonal cash crops as the chief and often sole 

 source of income, with a high percentage of tenancy, need of con- 

 siderable capital to grow and market the crops, and the lack of 

 diversification on most farms, a large demand for credit facilities is 

 created. In many localities the farmers obtain their sole cash income 

 during about two months of the year. Most of this goes to pay the 

 debts of the current year. Credit from some source is then needed 

 after the first of the succeeding year to carry the farmer over until 

 the next crop is marketed, for they must have fertilizer, household 

 supplies, clothing, and other necessities. In a large proportion of 

 the cases a crop lien or mortgage is given to the local merchant (the 

 so-called time merchant), banker, or fertilizer man. 



The amount of credit used as compared to the farm receipts in 

 1926 is shown in Table 5. In North Carolina the average amount of 

 credit used was over a fourth of the receipts. In South Carolina the 

 credit was 57 per cent of the receipts for the owners and 73 per cent 

 for the tenants. The percentage of credit is higher for the lower- 

 income groups, averaging over 100 per cent of the farm receipts for 

 the South Carolina tenants who received an annual income of less 

 than $500. lx The tenants tending to be in the lower-income groups 

 usually use a relatively greater proportion of credit than do the 

 landowners. 



In a study of social and economic conditions in North Carolina 

 (7, p. 28-31) it was found that in Edgecombe County from 79 per 

 cent to 100 per cent of the farmers, depending upon tenure and race, 

 used short-term and intermediate credit. Over half of this credit 

 was used for living ; the remainder was used for fertilizer, feed, seed, 

 and tools. Practically all of this credit was from merchants and 

 landlords, except in the case of owners or landlords who made some 

 use of bank credit. Over half of the white tenants and croppers 

 and practically all of the colored tenants and croppers produced crops 

 under crop lien or landlord credit. A smaller percentage of operator- 

 landlords and owner-operators had liens against their crops. In 

 most cases the holder of a crop lien exercises certain rights in regard 



11 Information from Division of Agricultural Finance, Bureau of Agricultural Economics. 



