Losses in the Department of Agriculture's Tobacco Program

RCED-85-167: Published: Sep 18, 1985. Publicly Released: Sep 18, 1985.

Additional Materials:

Contact:

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

Pursuant to a congressional request, GAO provided pricing and cost information on flue-cured tobacco under the Department of Agriculture's (USDA) tobacco program. Specifically, GAO estimated: (1) the losses that USDA could incur on 1976 through 1981 tobacco crops; (2) the total inventory price reduction resulting from USDA-approved discount sale terms; (3) the total price reduction on actual tobacco sales under the discount sale terms; and (4) interest costs incurred by USDA on the 1982 flue-cured tobacco crop.

GAO found that: (1) USDA stands to lose money on the 1976 through 1981 flue-cured tobacco crops under loan; (2) the actual losses will not be known until all of the old tobacco is sold, but the total price of the tobacco inventory was reduced by $326 million from the regular sales price under the discount terms; (3) USDA is incurring both interest costs and storage charges on the old tobacco; and (4) USDA has sold about 11 percent of the 1976 through 1981 flue-cured tobacco inventory at about $35 million below its regular sales price. In addition, GAO found that USDA has lost about $16 million in interest costs on loans made on the 1982 flue-cured crop under the No Net Cost Tobacco Program.

Jun 9, 2016

May 26, 2016

May 19, 2016

Apr 14, 2016

Jan 14, 2016

Jan 8, 2016

Jul 9, 2015

Jun 18, 2015

May 26, 2015

May 20, 2015

Looking for more? Browse all our products here