Chinese Province Steps Up Efforts to Encourage Tobacco Production

Source from:  Hubei Daily newspaper 08/11/2005

The provincial tobacco monopoly administration and the provincial China Tobacco Industry Corporation in central China's Hubei Province jointly announced in the tobacco-growing region of Enshi on August 6 that they will take a package of measures to encourage local farmers to increase the production of leaf tobacco. In making the announcement, Hubei Provincial Tobacco Monopoly Administration said that it will give priority to encouraging farmers in Enshi to increase tobacco production by issuing more leaf tobacco production quotas to the region and providing the region with greater technical and human resources support. The administration has decided to extend 10 million yuan (1.2 million U.S. dollars) in extra donation to support the development of exclusive high-quality tobacco production bases in Enshi, in addition to a total 43.5 million yuan (5.2 million U.S. dollars) already delivered. Besides, the administration will manage to raise 600 million yuan (72 million U.S. dollars) through the extension of loans and guarantee in funds for State purchase of leaf tobacco from Enshi region in the coming harvest season. Because of these support measures, the annual leaf tobacco yield from the exclusive high-quality leaf tobacco bases in Enshi is expected to go up to 650,000 dan to 700,000 dan (32,500 tons to 35,000 tons), from the current level of 450,000 dan (22,500 tons). Meanwhile, Hubei Provincial China Tobacco Industry Corporation has promised to increase the prices for State leaf tobacco purchase from Enshi, in order that the local tobacco growers will be able to earn a total of 40 million yuan (4.8 million U.S. dollars) in extra income in 2005. In 2006, the corporation will further raise the prices for State leaf tobacco purchase from Enshi. Moreover, it will invest in the establishment of two first-rate model high-quality leaf tobacco production bases in Enshi, each with a total area of 5,000 mu to 10,000 mu (3,333 hectares to 6,666 hectares). Chinese farmers are today less enthusiastic for growing tobacco than they did a few years ago, because of the government's adoption of a new policy to raise grain prices that has made tobacco prices in China comparatively low. Enditem