Reprinted from the Hobart Mercury article "Poppies come a cropper to oversupply", by Sue Bailey.

POPPY growers are facing a drop in income of as much as $20 million next season after Tasmanian Alkaloids yesterday announced a 50 per cent cut in the crop.

Tasmanian Poppy Growers Association president Lyndley Chopping said the cut would have a severe economic impact not only on poppy growers but also contractors and rural communities.

"The 50 per cent area reduction will result in $15 to $20 million less at farm gate, the consequences of which are obvious," Mr Chopping said. "The cuts will need to be equitably distributed across the state so as not to discriminate against particular areas or districts, taking into consideration the south and some other areas have already had their contracted area reduced by up to 30 per cent for the current season."

Poppy growers were seeking urgent discussions with Tasmanian Alkaloids to determine the methodology for implementation of the cuts.

Mr Chopping said the cuts should not be seen as a long-term decline for the industry.

"I have every confidence that the industry is on a very sound footing and Tasmania will continue to lead the world in opiate raw-material production," he said.

"The disastrous drought on the mainland could provide an opportunity for the vacated poppy ground to be sown with grain crops or other alternatives."

Tasmanian Alkaloids managing director Brian Hartnett said his company was the largest and most successful poppy-processing company in the world.

He rejected suggestions it had over-contracted supply.

Outstanding results had been produced over the past two seasons and the quality of the bumper crops was first-class.

"The adjustment now being made is a reflection of success," Mr Hartnett said.

"At all times the company has emphasised the cyclic agricultural nature of its business for suppliers making investment decisions."

He said the company had alerted growers early to the "temporary cutback for one season" so they could make alternative cropping arrangements.

The other poppy company operating in Tasmania, GlaxoSmithKline has said it would maintain production as usual next season.