The global tobacco market is expected to reach a value of $694.47 billion by 2021, according to a new study by Grand View Research.
This reflects 2.8 percent compound annual growth rate from 2016 to 2021.
Cigarettes account for the largest share in the global tobacco market in terms of both revenue and sales. In 2016, the segment amounted to $562.61 billion, equivalent to 93 percent of the market’s overall value
The Chinese market is anticipated to expand at a revenue-based CAGR of 2.6 percent from 2016 to 2021, while demand is also expected to witness a modest rise.
Advanced technologies have assisted the tobacco industry in automating manufacturing processes, in contrast to traditional manufacturing techniques that were labor dependent, according to Grand View Research. Automation has also helped market players to grow in terms of profitability as the cost of labor was being saved.
The global tobacco market is struggling due to ongoing restraints put by governments around the world on grounds of health issues, resulting in high taxes and unfavorable regulations. Tobacco manufacturing companies cannot market their products and are obligatory to issue health warnings on product packaging.
Rising health awareness, stricter government regulations on tobacco products, and increasing popularity of substitutes are adversely affecting market growth. Moreover, with tobacco manufacturers increasing the per unit price of cigarettes and other tobacco products due to increased tax, consumers are shifting preference to value-for-money products.
According to the authors, this will also take its toll on industry growth.
New market report
