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Scotland to follow Australia on packaging

| November 13, 2013

Scotland is aiming to become the second country after Australia to impose standardized packaging requirements on tobacco manufacturers, according to Ria Patel, writing in TopNews.

Since Dec. 1, Australia has required that all tobacco products be sold in packaging designed on behalf of the previous Labor government to be as ugly as possible. Packs are hugely dominated by graphic health warnings, are otherwise a standard olive color, have no logos or other design features, and have brand and variant names in a standardized font and position.

The Scottish government has announced that regulations requiring standardized packaging will be in place by 2014–2015.

“To build a generation free from tobacco, it is necessary to restrict the imagery and design that tobacco companies use to pull in another generation to use these addictive and lethal products,” said Public Health Minister Michael Matheson.

Matheson said that, in the meantime, the government would monitor what was happening in Australia in order to gather evidence about the effects of standardized packaging.

This, he said, would help the government initiate a consultation procedure in Scotland.

US government thinking of muscling in on manufacturer payments to growers

| November 13, 2013

The U.S. government has come under fire for considering appropriating millions of dollars that otherwise would be paid by tobacco manufacturers to tobacco growers.

This is not taxpayer money, but the government is in a position to appropriate it because the money passes through the hands of the U.S. Department of Agriculture (USDA).

“The U.S. government is considering withholding millions in non-taxpayer dollars owed to North Carolinians that depend on this income as part of the landmark tobacco buyout settlement,” according to a press note issued by the North Carolina Farm Bureau (NCFB).

“In 2004, the American Jobs Creation Act established the Tobacco Transition Payment Program (TTPP) to help tobacco producers transition to the free market. The program eliminated the tobacco quota and price support system in exchange for 10 annual payments to producers from 2005–2014. The “assets” once held by farmers and quota holders were replaced by legally binding contracts with the USDA, which manages the collection and distribution of TTPP funds. Only the 2014 payment is outstanding for completion of these contracts.

“Where TTPP payments differ from most other federal programs appropriate for sequestration is that these payments are not taxpayer funded; rather, they are funded through fees that are assessed to tobacco companies. [The] USDA’s only role is to pass along the fees collected from tobacco companies and distribute them to contract holders.”

“It does not matter whether the U.S. government decides to hold hostage all or just a portion of the millions of non-taxpayer dollars owed to N.C. tobacco farmers; our state’s economy and its largest industry—agriculture—will be negatively impacted,” said Larry Wooten, president of the NCFB. “We understand the fiscal realities that led to the sequestration of funding for other federal programs, but North Carolina citizens, in good faith, signed these binding contracts with their own government, and many have already factored these payments into their business plans for 2014. We believe the federal government is incorrect in considering sequestering a portion of the tobacco buyout payments owed to farmers in 2014.”

“While North Carolinians are owed the largest portion of the 2014 TTPP payments, farmers and quota holders in all 50 states are also owed money from the federal government,” the press note said. “If paid in full, the 2014 payments would total approximately $1 billion. OMB [Office of Management and Budget] officials have declined to confirm just how much of the payments they are considering withholding.”

Tax-free event review available online

| November 13, 2013

A digital review of the TFWA World Exhibition 2013 has been made available at

http://www.tfwa.com/inreview/TFWA-World-Exhibition-in-Review.

The TFWA (Tax Free World Association) event, which included an exhibition, conference, workshops and social events, was held in Cannes, France, on Oct. 25–26.

Manufacturing interaction at Imperial

| November 13, 2013

Factory managers from all of Imperial Tobacco’s production sites worldwide recently gathered at Santander in Spain. This was the first time that such a gathering had taken place.

“The event was an opportunity to celebrate achievements in the last 12 months, and awards were handed to those factories with outstanding results in safety, quality and reliability,” according to a note posted on the Imperial website.

During the event, Chief Executive Alison Cooper shared her insights into the business, while group manufacturing, research and development director, Walter Prinz, and his management team outlined the key challenges for the year ahead.

The event, which provided participants with an opportunity to visit Imperial’s cigar factory in Cantabria, was attended also by other guests, including Fernando Dominguez, director premium cigar.

Jacques Bouende, lead factory manager for West and Central Africa, said that the event had been “a great way to get to know those doing the same role and build up our network of contacts around the world.”

Test 2

| November 12, 2013

Japan’s growers to receive 0.84 percent more for 2014 crop than for 2012 crop

| November 12, 2013

Japan’s 2014 leaf tobacco crop will be grown on 8,964 ha, down by 2.7 percent on the area under tobacco this year, 9,245 ha, which was down by 1.4 percent on that of 2012.

The flue-cured production area, at 5,805 ha, will be down by 98 ha or 1.7 percent; the burley production area, at 3,135 ha, will be down by 144 ha or 4.4 percent; and the domestic variety production area, at 24 ha, will be down by 3 ha or 11.1 percent.

The Leaf Tobacco Deliberative Council announced last week its annual determinations for local tobacco cultivation areas and grower prices for 2014 in response to a proposal submitted by Japan Tobacco Inc.

The council comprises no more than 11 members appointed by JT with the approval of the minister of finance from among representatives of leaf tobacco growers and academics.

The council was said to have been in general agreement with JT’s proposal.

The average grower price for all types will be set at ¥1,906.47 per kg for the 2014 crop.

This was the same price that was set for this year’s crop, which itself was increased only by 0.84 percent on that of the previous year.

Including the results of its international tobacco business and its nontobacco businesses, JT’s April–September revenue, announced on Oct. 31, increased by 9.6 percent to ¥1,159.1 billion.

Operating profit was up by 30.8 percent to ¥347.4 billion, and the profit attributable to the owners of the parent increased by 40.5 percent to ¥237.1 billion.

The day before the announcement of its first-half consolidated results, JTI said that it was cutting its domestic workforce by about 1,600 people, and closing factories, sales offices and its vending machine division.

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