Australian Growers Agree Exit Package

Source from:  Tuesday, October 31, 2006 tobaccoreporter.com 11/02/2006

Tobacco growing is set to end in Australia after growers at Myrtleford voted at the end of last week to accept a A$10 million exit package being offered by British American Tobacco and a federal government buyout worth up to A$16.8 million. According to an ABC report, leaf tobacco contributes about A$90 million a year to the Myrtleford area and the decision will leave about 500 families looking for an alternative. In all, the federal government is said to be providing up to A$40.9 million to help growers in three areas move out of tobacco. Up to A$23.2 million will go to former tobacco growers in northern Queensland whose growing licenses were cancelled by the Australian Taxation Office in 2004, and up to A$900,000 will go to growers in southern Queensland. The government funding will be capped at A$150,000 per grower. BAT advised growers earlier this year that it would not be buying any more tobacco after 2009, but high production costs had meant that the industry had been in decline for some years, and its demise was almost guaranteed in the late 1990s when the World Trade Organization overturned an Australian policy that required the inclusion in local cigarettes of at least 57 per cent of domestic tobacco. Enditem