Objective This study, conducted in China, explores tobacco farmers’ willingness to accept (WTA) compensation for tobacco crop substitution.

Methods The contingent valuation method was used to elicit farmers’ WTA compensation. A face-to-face survey was conducted with 280 tobacco farmers in Lichuan City, China. The standard logit regressions were used to identify the factors that influence farmers’ WTA.

Results Without compensation, most of the respondents were unwilling to implement tobacco crop substitution. However, if the government provided compensation, the proportion of respondents’ willingness for substitution increased to 86.7%. Male tobacco farmers are more likely to accept a given compensation value than female farmers. Older tobacco farmers have a higher probability of accepting compensation. The number of farmers engaged in tobacco growing in a family is negatively associated with the probability of accepting a given compensation amount. Tobacco farmers with greater confidence in the expected benefits of tobacco crop substitution tend to be more willing to accept compensation. The mean WTA estimate was achieved as US$2020.35/ha/year.

Conclusions If appropriate compensation is provided for tobacco farmers, there is a potential to implement the tobacco crop substitution policy in the study area.