The eisteddfod travels to a different part of Wales every year

The 2004 event - the highlight of Wales' cultural calendar - may prove to be crucial for the festival which has serious concerns about its finances.

Some controversial changes, such as selling alcohol on the main field for the first time in its history, are designed to boost visitor numbers.

And excellent weather may also lend a hand in bringing in the crowds.

Tredegar House on the outskirts of Newport has been transformed for the eisteddfod - which promotes the Welsh language and the arts and runs until 7 August.

You can enjoy most of the competitions without the language Dr John Hughes

A 4,000-seater pavilion overlooking the main field, known as the maes, is set to host a stream of artistic and literary competitions.

There is also a theatre, an arts and crafts exhibition, a literature pavilion, a Welsh learners centre and a science and technology exhibition.

Thousands of people are expected to descend on Wales' newest and most anglicised city to see the contests, as well as ceremonies such as the crowning of the bard.

But organisers admit the festival, which attracts more than 150,000 people every year, is already in financial crisis.

The eisteddfod is an annual celebration of Welsh culture

The event costs �2.5m to stage and last year's event in mid Wales barely broke even.

Experts have said that if this year's event loses money, it could put the future of the festival in jeopardy.

Organisers are concerned that numbers could be down in an area where Welsh is not widely spoken - an estimated 95% of the Newport's population do not speak Welsh.

They hope changes, such as allowing alcohol, will appeal to a wider range of people.

Dr John Hughes, chair of the eisteddfod committee, said: "You can enjoy most of the competitions without the language - their music, playing instruments, dancing, and so on.

"The great ceremonies - you can enjoy those without the language - and then of course you can get a free translation machine."