THE world's second-biggest tobacco company is considering releasing tobacco designed to compete with illegal chop-chop tobacco.
It would cost about $9 for 25 cigarettes.
The new tobacco is designed to work with a cheap high-tech machine that injects tobacco into pre-made empty cigarette tubes complete with filters. The result is far neater than traditional "rollies" - a roll your own cigarette made by hand or a simple machine.
British American Tobacco Company spokesman Scott McIntyre said the multinational corporation would be "forced to compete with organised crime" unless the Australian Government cracked down on an influx of illegal, unregulated tobacco.
He said it would release its Make Your Own brand in Australia - a loose-leaf product available in the UK that allows users to make store-quality cigarettes at home.
"Currently the illegal trade in Australia makes up 14.5% of all tobacco consumed in Australia which is nearly 2.6 million tonnes and a big opportunity for us to steal back consumers," he said.
"If we were to price the legal (Make Your Own) brand competitively with chop-chop then there's potential to capture a huge untapped market share of over 8% at the very bottom end.
"The product could be sold as very cheap loose tobacco in 100 or 25g packs."
The proposed product would work out at about $9 for 25 cigarettes.
The cheapest packets available in Australia are just less than $15 a pack.
Police busts on unlicensed tobacco sales in NSW happen most frequently in Sydney but the rest of the state is not immune.
Two men were arrested after being found allegedly with a tonne of chop-chop in Coffs Harbour last year, although investigators believed the haul was headed to the state's capital.
Victoria last year quadrupled fines for any retailers caught selling illegal cigarettes, with individuals facing fines up to $34,600 and businesses up to $173,200.
The Australian Crime Commission says organised crime groups consider the chop-chop a low-risk market where "large profits can be made with minimal risk of detection or significant penalties".
A study of Australian smoking habits in 2004/05 found tobacco caused about 90% of drug-related deaths and 11% of all deaths.
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