123 



ing the price he will receive for his product. The manufacturer, 

 likewise, can best formulate his manufacturing and sales policies, 

 when he knows the probable cost of his raw material. There seems 

 to be no question but that stabilization of production and marketing 

 conditions would benefit the manufacturers. 



The manufacturer would also benefit from more economical and 

 efficient production. The production of improved types and va- 

 rieties certainly would be to his advantage, even though competition 

 for the most desirable grades would continue to return higher prices 

 to the producers of these grades. The benefits of economies in pro- 

 duction, theoretically, would be shared by the growers, the manu- 

 facturers, and the consumers. 



A second advantage of an efficiently operated growers' coopera- 

 tive association to the manufacturers comes from greater economy 

 in acquiring their supplies of leaf tobacco. Assembly of tobacco 

 in large lots by the association enables the manufacturer to obtain 

 those lots which meet his requirements with a minimum of pur- 

 chasing expense. He also has a somewhat wider selection and more 

 assurance of obtaining exactly the types and grades he requires 

 without the necessity of purchasing tobacco which may not be 

 adapted to his needs. It is felt that the Federal system of standard 

 grades could be used to advantage by the buyers and that the service 

 of the association to its customers should include strict adherence 

 to these grades, and satisfactory adjustments in cases where the 

 buyer's specifications were not met. This policy on the part of the 

 cotton-marketing associations, as one example, has resulted in close 

 and generally highly satisfactory relations with the mills which buy 

 cotton sold by the cooperatives. 



It should be clear that it is not desirable, even if it were possible, 

 to maintain tobacco growing as a bonanza industry. Inflated prices 

 bring a reaction because of competition from new producers and 

 new areas, and their general effect is to depress the economic level 

 of the growers. Neither is it desirable that tobacco should con- 

 tinue to be produced under the low economic, social, and educational 

 conditions which characterize so many tobacco districts in the 

 South. Public opinion expressed in laws or regulations may in 

 time demand drastic remedies for the tobacco growers' situation. 

 If such an occasion arises, the tobacco companies will not escape 

 censure. It is much more desirable from every point of view that 

 the industry should be stabilized by the cooperation between these 

 companies and the organized growers. Once the producers and 

 manufacturers are able to see beyond temporary advantages, and to 

 study the welfare of the industry and their own long-time interests, 

 there should be little difficulty in effecting such business cooperation. 



A SUGGESTED PLAN FOR THE SUCCESSFUL COOPERATIVE MARKETING OF 



TOBACCO 



The difficulties experienced by the Tobacco Growers' Cooperative 

 Association indicate that, in the tri-State area at least, cooperative 

 marketing of tobacco can not be successful without business coop- 

 eration between the manufacturing companies and the growers' 

 organization. The producers and the manufacturing consumers of 

 leaf tobacco have a common interest in the stabilization of the in- 



