The Hogshead Market 



Prior to the development of the "loose-leaf" auction system of sales, 

 growers packed their tobacco in hogsheads for delivery to commission agents. 

 This was much the same procedure as was followed in the very early days of the 

 country. Originally, the grower received a negotiable receipt for each hogs- 

 head delivered, before inspection and final sale. In the early 1800' s, the 

 practice of sampling the hogsheads and selling by auction established the first 

 form of sale by the auction system. 



Today, the only such hogshead market in operation is the "closed-bid" 

 auction at Cheltenham, Md. , which sells a small quantity of the Maryland to- 

 bacco. The tobacco is delivered to the marketing association which operates as 

 the commission agent. After the State inspectors take samples from the hogs- 

 heads and affix the State seal, the samples are made available for examination 

 by prospective buyers. The buyers submit "closed" or sealed bids on individual 

 hogsheads; these bids are opened at a specified time and the highest bid is ac- 

 cepted subject to grower approval. 



Since the establishment of the loose-leaf markets in Maryland in 1939, 

 almost all the tobacco grown in that State has been sold on the auction floors. 



Cigar-leaf Marketing (Country Sales) 



In most of the cigar-leaf tobacco districts, farmers contract for the sale 

 of their tobacco at the farm, a system known as "barn-door" marketing. This may 

 be done during the growing or curing season, or after it has been cured, 

 stripped, and baled. Buyers may be cigar or chewing tobacco manufacturers, in- 

 dependent packers, or their representatives. Although competitive bidding ex- 

 ixts in the sence that various buyers inspect the tobacco and make offers, com- 

 petition is not as apparent as in the auction method of sales. 



The buyers travel through the producing districts during the growing sea- 

 son, and note the progress of individual crops, as well as the changes in the 

 acreages and crop prospects, as compared with other years. In this way they 

 keep themselves informed on the location of desirable crops. 



Sales may be at a flat price per pound for the entire crop; or, as is more 

 common, at separate rates per pound for the two main groups made at stripping: 

 (1) those suitable for cigar-manufacturing purpose, and (2) those known as 

 stemming grades suitable primarily for the manufacture of chewing tobacco. 



Cigar wrapper is grown under almost every kind of arrangement imaginable. 

 Sometimes the buyer rents the land, hires the owner as foreman, and has him 

 grow the tobacco for his (the buyer's) account; and in some cases the buyer and 

 farmer each contributes certain specified items of cost and each shares in the 

 proceeds in relation to this contribution. A common practice is the growing of 

 the tobacco by the manufacturer himself on his own land. Sometimes a farmer, 

 who thinks he has an unusually fine crop and believes the prevailing market will 

 improve, has his tobacco sorted, sweated, packed, and stored for sale at a 

 future time. 



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