Tasmania's poppy monopoly is coming to an end as the Federal Government welcomes other states to join the lucrative industry.

The poppy industry is worth $90 million to Tasmania but this week Victorian farmers will begin sowing seeds for the state's first commercial poppy crop.

The Federal Government has announced a five-year controlled implementation program having fielded requests from pharmaceutical companies and other jurisdictions.

The Northern Territory is being explored as a grower and Western Australia is expressing interest.

Companies licensed to process poppy into legal medicines want to reduce the risk of having all their poppy come from one region.

Having mainland suppliers would limit exposure if adverse weather conditions afflicted Tasmania's crop, or visa versa.

Parliamentary Secretary for Agriculture Richard Colbeck said other states wanted to be able to grow poppies.

"So we're commencing a process to negotiate the expansion of the industry," he said.

Tasmania's poppy pre-eminence 'not under threat'

Tasmanian poppy growers are playing down the impact of an agreement, with the Poppy Growers Association's president Glynn Williams confident the state will remain the dominant force.

"Because the expertise is here, that's the number one factor in terms of productivity," he said.

"Number two, Tasmania is now drought-proofed so the irrigation schemes mean as climate change continues and we see a return to dry conditions, Tasmania can supply while others can't because of our temperature advantage."

Jarrod Ritchie, the managing director of processing company TPI, is happy about the development.

"It's good news for the industry as a whole and it cements Tasmania's and Australia's reputation as a reliable supplier," he said.

The Tasmanian Government is also happy with the approach.

"The Commonwealth has considered our request for a measured and sensitive approach to this issue," said Primary Industry Minister Jeremy Rockliff.

Australia's obligations under international drug control treaties will impact how much the industry can expand around the country.

Mainland states will need to seek approval before being allowed to process or export the narcotic material.