Plowing new ground in agriculture.

• Position: North Carolina - Industry Overview

Farmers grow profits by expanding their markets - and their horizons.

David Burns, a Scotland County farmer and agribusiness executive, is looking to the future in an antebellum crop. He stuck with cotton in years past even though it took 12 to 15 expensive applications of insecticide a season to control boll weevils.

Now, his patience is paying off. In 1994, with some grades of cotton fetching 76 cents a pound - up 25% from 1993 - and North Carolina's weevil-eradication program reducing sprayings to three shots per crop, cotton was once again a viable cash crop. Admittedly, it's not about to replace Burns' favorite, tobacco, which can gross $4,000 an acre, compared with $500 an acre for cotton. But a good cotton crop can help offset a mediocre or bad year in tobacco.

Last year was pretty good all around, says Burns, president of Z.V. Pate Inc. in Laurel Hill: "It has been a somewhat better-than-average year. We had an ample-to-somewhat-surplus supply of rain but a dry fall." In addition to raising row crops, the private company operates a restaurant, sells farm implements and grows timber.

Burns' positive assessment reflects the feeling of many of the state's farmers and businesses involved in agriculture, which recorded $41 billion in gross sales in 1994. The good year was a result of a combination of favorable weather and strong markets for new crops - such as lettuce, broccoli and farm-raised trout. Plus, there was a steady demand for traditional products such as hogs, tobacco, turkey and broiler chickens. In all, farming and related endeavors netted a record $5.2 billion last year, about 34% of gross state product, says Weldon Denny, deputy commissioner of the N.C. Department of Agriculture.

In 1994, North Carolina became the nation's third-most diversified farm state based on commodities with sales of more than $1 million.

The year's big news in tobacco came in September, when Fayetteville Democrat and U.S. Rep. Charlie Rose aired a plan that would wean tobacco growers from the artificially high prices created by the federal quota system. Rose suggested the federal government use an increase in the excise tax on cigarettes to buy out farmers' quotas and bring down tobacco prices. Under the new plan, which would cost more than $10 billion, price and production would be driven by market forces rather than calculated by the U.S. Department of Agriculture.

Carl Sofley, the N.C. Department of Agriculture's tobacco administrator, thinks...