POPPY processor TPI Enterprises says planting in NSW could begin as early as April if legislation passes parliament as expected.
But farmer representatives say the company’s five-year, 5000-hectare poppy vision for NSW will be a slow burn – rather than an immediate boost - for the state’s $12 billion agriculture sector.
NSW is set to pass laws that would see it join Tasmania, Victoria and the Northern Territory as legal producers of alkaloid poppies. South Australia is expected to follow suit.
Until 2014 Tasmania enjoyed a 40-year poppy monopoly, and, despite sagging under current market conditions, still produces 80 per cent of the world’s raw narcotic product for various medicines.
On the right land alkaloid poppies can produce about $10,000 of raw material per hectare.
NSW ag minister Niall Blair’s introduction of the Poppy Industry Bill 2016 last week came about a year after TPI enterprises - one of three processing companies based in Australia - relocated its 100-tonne processing facility from Tasmania to Melbourne.
TPI has growing operations in all legal states.
TPI chief executive Jarrod Ritchie said expanding into SA and NSW would help the company double its capacity to about 15,000 hectares, with NSW earmarked for about 5000 hectares within three to five years.
“Obviously the laws are still pending, but if all goes as planned we will start going through the police checks and getting our field officers and agronomists out on site ready for an April plant,” Mr Ritchie said.
“The key is maintaining a stable, reliable supply and to do that you need the right growers and the right conditions.”
Mr Ritchie said the average yield of narcotic raw product from Australian alkaloid poppies was 15 kilograms per hectare. More productive land can produce closer to 60kg, with the raw materials fetching between $150 to $200/kg.
Input costs range from $1500 to $2000 per hectare including a conservative estimate of 2.5ML of water per hectare.
“If you’ve got experience with cropping, you’ll be fine,” Mr Ritchie said. “Particularly the rice and cotton growers.”
“We’re not saying this is a silver bullet. It just gives growers another option.”
NSW Farmers Justin Crosby said the success of poppies would depend on processors’ ability to identify the right growers.
“The good thing is that we’ve got the opportunity to build up as the world’s demand for medicine continues,” Mr Crosby said.
“It just needs a secure and stable supply chain to be put in place.”