ASHLAND — For more than a century, coal and tobacco have been major sources of income in Kentucky for mining companies, miners and farmers and for the businesses in communities where they live. But in recent years, the market for both tobacco and coal has been declining. 

For tobacco, a steady decline in the number of smokers, the demise of the tobacco quota system and increased foreign competition have combined to greatly reduce the demand for burley. While just a few years ago, scores of small farmers across Kentucky grew tobacco in small lots and sold them at auction, today only a relatively few large farmers raise tobacco and they sell their crops directly to tobacco companies.

For coal, the market has been declining as more and more electric generating plants switch to cleaner-burning natural gas or other types of fuel, and the amount of electricity produced by wind and other alternative fuels increases.

Let’s face it, many Americans consider tobacco a deadly product and actually cheer its demise, and many also believe coal and other carbon fuels foul the air and that surface coal mining destroys beautiful mountains and pollutes streams and rivers. As a result, the number of friends coal has in Washington, D.C., continues to dwindle.      

So what can be done to preserve both coal and tobacco as major source of revenue in Kentucky? Well, one way is to increase exports for both coal and tobacco. While it will never be enough to replace the dwindling market in the United States, Kentucky farmers are benefiting from more exports of American grown tobacco to countries like South Korea and China and even some European nations. Clearly, if there is any growth market for tobacco grown in Kentucky, it is in exports of the crop to countries where smoking is more socially acceptable and more common than it is in the U.S.

The exporting of coal to foreign lands has a much greater potential for producing income for Kentucky than do tobacco exports. That was proven just the other day with the announcement of a private-sector agreement to export to India 9 million tons of coal a year from Kentucky and West Virginia.

Gov. Steve Beshear announced the 25-year, $7 billion agreement between India’s Abhijeet Group and Kentucky-based Booth Energy Group and River Trading Co., calling it good news for U.S. coal miners who have lost their jobs because of a decline in domestic coal sales.

“It’s no secret that the coal industry is in a state of flux, what with erratic market conditions, the uncertain regulatory atmosphere and the ever-changing energy picture,” Beshear said. “This creates challenges in Kentucky where mining has been a huge source of jobs and a pillar of our state economy.”

The agreement also is a boon for India where recent power outages affected over 600 million people. India is a major coal producer, but it can’t keep up with demand from steel mills and power plants without imports.

Most of those imports now come from Australia, Indonesia and South Africa. Kentucky is a newcomer to this lucrative coal market.

“With 1.6 billion people on this planet not having access to electricity, there is a tremendous international market for our coal worldwide,” said Kentucky Coal Association President Bill Bissett. “While we currently only export about 5 percent of our Kentucky coal overseas, we expect that number to grow.”

Booth Energy President Jim Booth said his company has the capacity to supply about 2 million tons of coal annually to India. Other coal producers in Kentucky and West Virginia will be called on the pick up the remaining 7 million tons called for in the agreement.

India does not have the strong environmental regulations on the burning of coal and other fossil fuels that the U.S. has, and with coal generating plants shutting down or switching to other sources of fuel in the United States, more coal generating plants are being built in India and other developing countries. It make good economic sense for Kentucky mines to aggressively seek to meet the increased demand for coal.

While even in this region, there are many people who hate the damage surface mining does to our landscape and to our waterways, no other industry comes close to providing the high-paying jobs in rural, mountain communities that coal does. While we very much would like to see coal mined in a more environmentally responsible manner, we recognize that without coal,  the poverty level in many counties in this region would be much, much higher than it already is.

While the market for coal may be dwindling in the U.S., coal still produces well over half of the electricity in the country. Thus, the U.S, market for coal may be smaller, but it is not about to disappear. As for tobacco, well, we’re not so sure, since everything made for tobacco seems to be harmful to one’s health.