Farmers pin fortunes on bale-whether crop.

Part of the future of North Carolina farming hangs by a thread -- a cotton thread. A record year closed the gap between the state's second-largest crop, cotton, and its troubled perennial No. 1, tobacco.

In 2000, Tar Heel cotton farmers produced 1.45 million bales, up 71% from the year before and 21% more than the 1926 record. Tobacco production declined 3%, to 423 million pounds, because of reductions in quotas that limit how much farmers grow. Money is another matter. The record cotton crop brought $417 million, up 78% from 1999, still far shy of the $1.1 billion that farmers got for their flue-cured tobacco in 2000, up 41% from 1999.

Even Garysburg cotton farmer David Grant doesn't overrate the crop as the answer to tobacco's uncertain future. "It would probably take a thousand acres of cotton for a man to have the same standard of living he would have on a 50-acre tobacco farm," he says. That's undoubtedly an exaggeration -- others put the ratio at eight acres of cotton per acre of tobacco. But farmers planted more than five times as many acres of cotton as they did tobacco in 2000, and even a record crop brought in just over a third of the revenue tobacco produced.

But while it's hard to minimize what tobacco still means to Tar Heel agriculture, it's equally hard to overlook its decline. Quotas in 2000 were about half what they were three years earlier. Although farmers got $185 million in state and federal aid to help recover from Hurricane Floyd in 1999, N.C. Department of Agriculture spokesman Jim Knight estimates that 200 to 250 farmers quit.

Cotton is attractive to farmers because prices have been stable and because they can grow as much as they want. Production of the crop exploded last year because conditions were perfect. "Almost all areas of the state received adequate rainfall all summer," Grant says. "Then we had a dry harvest season, which enabled us to get the crop out in a timely manner."

Grant, 46, says his family has been growing cotton in Northampton County "since before the war" -- the Civil War. As recently as 1978, cotton production in the state had declined to 42,000 acres, compared with 930,000 acres in 2000, and was concentrated in Scotland and Northampton counties. In the early 1980s came a breakthrough. "We eradicated the boll weevil in North Carolina, which lowered our production costs considerably, like $75 an acre," Grant says. "That made cotton a lot more competitive."

It became even more attractive as prices for feed grains tumbled after the 1996 Freedom to Farm Act ended price supports that kept some land out of production. From 1995 to 1999, overproduction pushed corn prices from $3.54 to $2.25 per bushel, and soybeans dropped from $6.95 to $4.64 per bushel. Cotton dropped, too, from 78 cents to 46 cents per pound, but the price rebounded to 60 cents in 2000. That increase, coupled with greater production, made cotton a better proposition.

Another piece of the cotton puzzle fell into place in 1997, when genetically engineered herbicide-resistant cotton seed hit the market. "It's become extremely popular with farmers, mainly because it doesn't require as much labor or as much management," Grant says. Such innovation, he adds, holds the key to the future of cotton farming, though he'd like to see private and university researchers focus on increasing yields, which hit a plateau a decade ago.

He says farmers also must deal with the decline of the U.S. textile industry, which still buys about two-thirds of the Tar Heel cotton crop. Prices might be 7 cents per pound less on world markets.

But cotton's uncertainty is nothing compared to what tobacco farmers face. Knight, the Agriculture Department spokesman, says the quality of the 2000 crop was good, thanks to the same weather that helped cotton. But major questions still surrounded tobacco. Tobacco companies continue to face legal threats, and the quota for the year was set at 548.9 million pounds, only about 1% more than last year.

Uncertainty also troubles the hog industry, hit by depressed pork prices -- down from 53 cents a pound in 1997 to about 30 cents in 1999 -- and threats of lawsuits by environmental lawyers, including Robert F. Kennedy Jr. The state's largest hog producer, Smithfield, Va.-based Smithfield Foods Inc., and another large producer, Premium Standard Farms Inc., based in Kansas City, Mo., agreed with the state last year to put up $17.5 million for N.C. State University to research ways to replace hog-waste lagoons. Some of the ideas will be field-tested this year, Knight says.

                         N.C. EMPLOYMENT AND WAGES
                 (employees with unemployment insurance in
                    agriculture, forestry and fishing)
                          1995    1997     1999
Employers                4,829   5,574    6,233
Employment              42,332  49,036   51,747
Total wages (millions)  $693.3  $886.4 $1,035.4
Average weekly wage    $314.96 $347.61  $384.40
Source: Employment Security Commission
                              TOP FARM STATES
                               (in millions)
STATE          CASH RECEIPTS
California           $24,801
Texas                 13,052
Iowa                   9,716
Nebraska               8,555
Kansas                 7,616
Minnesota              7,061
Florida                6,928
Illinois               6,757
North Carolina         6,687
Wisconsin              5,596
United States        188,609
Source: N.C. Department of Agriculture, 1999
                           TOP N.C. COMMODITIES
                               (in millions)
Broilers                 $1,430
Hogs                      1,160
Greenhouse/nursery items    973
Tobacco                     784
Turkeys                     475
Cotton                      234
Chicken eggs               $231
Dairy                       208
Cattle and calves           193
Soybeans                    154
Corn                        102
Christmas trees              92
Other                       651
Total                     6,687
Source: N.C. Department of Agriculture, 1999 cash receipts
                               TOP COUNTIES
                               (in millions)
CROPS              ANIMALS         TOTAL
Johnston    $158.9 Duplin   $438.3 Duplin   $522.4
Henderson    127.7 Sampson   414.6 Sampson   509.1
Mecklenburg  124.1 Union     223.2 Wayne     277.0
Wilson       117.9 Wilkes    208.5 Union     268.6
Sampson       94.5 Wayne     205.5 Wilkes    222.1
Buncombe      92.9 Randolph  157.4 Johnston  209.6
Pitt          90.1 Bladen    119.6 Randolph  187.1
Duplin        84.1 Anson     116.7 Robeson   168.6
Nash          81.8 Chatham   116.0 Bladen    158.2
Robeson       81.0 Moore      97.1 Pitt      147.2
Source: N.C. Department of Agriculture, 1998 cash receipts
                             NATIONAL RANKING
                         SHARE         STATES
                   N.C. OF U.S.        AHEAD
COMMODITY          RANK RECEIPTS      OF N.C.
Tobacco             1     34.5%
Turkeys             1     16.7
Sweet potatoes      1     23.1
Hogs                2     13.5          Iowa
Christmas trees     2     21.9         Oregon
Pickling cucumbers  2      7.6        Michigan
Trout               2      8.8         Idaho
Poultry and eggs    3      9.8       Ark., Ga.
Greenhouse/nursery  4      7.9   Calif., Fla., Tex.
Broilers            4      9.5    Ga., Ark., Ala.
Blueberries         4      8.6   Mich., N.J., Ore.
Peanuts             4      8.5    Ga., Texas, Ala.
Strawberries        4      1.3   Calif., Fla., Ore.
Source: N.C. Department of Agriculture, 1999