Health Minister Mark Butler has conceded the tobacco black market has "exploded" into the biggest threat to public health in Australia.

Mr Butler admitted on Adelaide local radio that organised crime had recently taken a "stranglehold" over the illicit tobacco market.

"It started in Melbourne and it spread right through the country. It means that there is violence and arson taking place as rival gangs try to take control of what is a very high-revenue market for them," the minister told FiveAA.

"It bankrolls all of their other criminal activity: their sex trafficking, their drug trafficking, all of the crimes that have very serious victims involved.

"From a health minister's perspective, it is now the biggest threat to our most important public health program."

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