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USDA Announces Tobacco Transition Program Payments

WASHINGTON — The U.S. Department of Agriculture (USDA) announced today it will begin issuing Tobacco Transition Payment Program (TTPP) payments to quota holders and producers. Quota holders and producers can enter into successor-in-interest contracts beginning Jan. 17, 2012, which would enable them to receive lump-sum payments from private entities by selling the remaining three TTPP payments.

A total of approximately $7.2 billion will have been paid to tobacco quota holders and producers with this seventh round of payments. The payments announced today represent more than $950 million. The TTPP marks the end of the federal tobacco marketing quota and price support loan programs in place since the Great Depression. The Fair and Equitable Tobacco Reform Act, enacted in October 2004, established this program.

The TTPP is funded by assessments on tobacco product importers and manufacturers. The program, begun in 2005, ends in 2014, and provides 10 equal annual payments to quota holders and producers.

USDA does not make lump sum TTPP payments to quota holders and producers. However, quota holders and producers can receive lump sum payments by selling their interest to a third party through “successor-in-interest” contracts. Since 2005, third parties bought more than 170,000 TTPP contracts worth more than $3 billion.

For more information on the Tobacco Transition Payment Program, visit the is dedicated to serving the agricultural industry in the Carolinas and Virginia with the latest ag news, exclusive regional weather station readings, and key crop market information. The website is a companion of the Southern Farm Network, provider of daily agricultural radio programming to the Carolinas since 1974. presents radio programs, interviews and news relevant to crop and livestock production and research throughout the mid-Atlantic agricultural community.