City Tobacco Company Subsidizes Tobacco Production

Source from:  Shaanxi Daily newspaper 06/29/2005

Baoji City Tobacco Company, which doubles as the city tobacco monopoly administration, in northwest China's Shaanxi Province has recently adopted a series of policies or measures to support tobacco production in the city, including the extension of financial assistance to leaf tobacco production. Over the past year, tobacco production in China has been negatively affected by farm produce price fluctuations and increases in the cost of production, dampening the enthusiasm of farmers for growing tobacco. In light of such a situation, Baoji City Tobacco Company has decided to extend 6.5 million yuan (783,130 U.S. dollars) in pre-production subsidies for leaf tobacco production in Baoji, at a rate of 100 yuan per mu (180 U.S. dollars per hectare). The subsidies will be extended in the forms of chemical fertilizer, pesticides, seeds, coal, cultivation, etc. In a related development, the cigarette sales volume in Baoji City in the first five months of 2005 went up 11.8 percent over the same period of 2004, with profits going up 36.4 percent year-on-year. Enditem