Sale of JT Stake Dependent on Leaf Buying Commitment

Source from:  Tobacco Reporter 08/19/2011

A prerequisite of the Japanese government's selling any of its stake in Japan Tobacco would be that the company continued to buy all domestically-grown tobacco, according to a story in the Financial Times quoting Koriki Jojima, deputy chairman of the Democratic Party of Japan's (DPoJ) policy research committee. But Jojima reiterated that the government was considering selling part of its stake in JT to help rebuild the quake-hit north-eastern part of Japan. At a meeting on August 10 of the DPoJ panel on reconstruction, the finance ministry proposed reducing the government's stake in JT from 50.1 per cent to 33.4 per cent in order to raise about ¥600 billion. A final decision is expected by the end of September. A law enacted in 1984 requires JT to buy the country's entire tobacco crop at prices agreed upon with the farmers. This year, the prices are set at about four times international levels. Japan has about 10,800 tobacco growers, down from about 21,000 in 2001, many of whom are in Fukushima where the earthquake hit. Enditem