Philip Morris has committed to buy tobacco from the Spanish region of Extremadura, according to a Cinco Días story quoting the president of the local government, Jose Antonio Monago.
Philip Morris would sign with the Spanish government a memorandum of understanding that would benefit Extremadura’s tobacco producers.
More than 80 per cent of Spanish tobacco production is concentrated in Extremadura.
The number of illicit cigarettes bought in the UK is set to soar, according to a story by Nick Goodway for The Independent.
Goodway reported that, during a shopping trip around north-west London, representatives of Japan Tobacco International had discovered a ‘huge range’ of counterfeit cigarettes and hand-rolling tobacco being sold for about half the normal retail price of licit products.
JTI is said to believe that after big duty hikes in the past two budgets – a total of 70p on a pack of 20 – the rates of smuggling and of the production of counterfeit cigarettes are set to soar.
Martin Southgate, JTI’sUKmanaging director was quoted as saying that he believed this situation would be made worse with the introduction of plain packaging for tobacco products.
“These measures will not help achieve a reduction in young people taking up smoking; this will only increase the illegal trade in tobacco.”
Japan Tobacco Inc. said today that it had entered into an agreement to acquire all of the outstanding shares of Al Nakhla Tobacco Company S.A.E. and Al Nakhla Tobacco Company – Free Zone S.A.E. (collectively, Nakhla).
‘The agreement has been signed1 between the JT Group and BATATAS.A., which controls Nakhla,’ JT said in a note posted on its website.
‘JT expects to complete the acquisition in the fiscal year ending March 31, 2013.
‘Nakhla, with headquarters and two factories inCairoandShebin El Kom,Egypt, is one of the world’s leading waterpipe tobacco (also known as molasses and shisha) manufacturers with an important presence in its home market.
‘It exports to 85 countries, primarily in the Middle East andNorth Africawhere such products have a deep rooted heritage.
‘With a heritage of almost 100 years of industry experience, Nakhla pioneered the concept of aromatic molasses and holds a 70 per cent market share in this segment inEgypt.
‘Nakhla’s total sales volume was approximately 24,000 tons in 2011 (roughly comparable to 24 billion cigarettes by volume), across a diverse brand portfolio comprising El Nakhla, Classic, Mizo and other popular trademarks.’
“Our acquisition of Nakhla offers an excellent opportunity for growth in the waterpipe segment and widens our brand portfolio, in line with our strategy to address the needs of adult consumers across a range of tobacco product categories” commented Fadoul Pekhazis, Japan Tobacco International’s regional president of its Middle East, Near East, Africa and Turkey regions, and its World-wide Duty Free operations.
“Furthermore, the acquisition enhances JTI’s geographical footprint in the Middle East and Africa, and over the long-term provides a platform for JTI to participate in the sizeable cigarette market inEgypt.”
JT said it was envisaged that the acquisition would be funded by JT Group’s existing funds and, if necessary, by loan facilities.
‘The transaction is valued at a high single digit multiple of Nakhla’s underlying earnings before interest, tax, depreciation and amortization in 2011,’ JT said.
‘The acquisition is expected to have a minor effect on the Group’s consolidated performance, cash flow and balance sheet.’
Increasing China’s cigarette tax by Yuan1 per pack could help reduce consumption by three billion packs a year, reduce the number of smokers by 3.42 million and generate additional government revenue of Yuan129 billion annually, according to a China Daily story relayed by the TMA.
The story quoted the World Health Organization’s representative in China, Dr. Michael O’Leary, as saying that the above figures had come from studies, though the version of the story TR saw did not give details of the studies.
O’Leary said the economic growth inChinaduring the past two decades had made cigarettes more affordable.
He said that purchasing 100 packs of the cheapest cigarettes required nearly 14 per cent of the average annual per capita income in 2000, but that this figure had dropped to less than three per cent in 2010.
The WHO recommended that excise taxes should account for at least 70 per cent of the retail price of cigarettes, but the rate was 30-40 per cent inChina, said O’Leary.
If the government failed to take action to reduce smoking rates; of the 300 million young people in the country, 100 million would die prematurely of smoking-related illnesses.
The Thai Tobacco Trade Association (TTTA), which represents about 1,300 retailers, wholesalers and distributors acrossThailand, has called on the Ministry of Public Health to abandon plans for further anti-tobacco measures, according to a story in the Bangkok Post.
“We are not against health concerns, but the law should not increase the burden on retailers as selling cigarettes is not against the law,” said TTTA executive director Varaporn Namatra.
“The law should not limit people’s rights and freedoms.”
The provisions under the proposed Tobacco Consumption Control Act (TCCA) will require retailers – there are said to be 480,000 registered retailers nation-wide – to submit costly annual reports, restrict the age of sales persons, participate in anti-smoking campaigns and restrict the display of prices.
The TCCA would also prohibit major retailers from partnering government agencies in conducting charitable programs, such as providing disaster relief support in response to flooding, Varaporn said.
“Moreover, the draft is too broad, ambiguous and gives the Public Health Ministry too much authority to issue further regulations without public consultation or review by parliament,” she said.
According to a new poll conducted amongst 1,000 retailers by IpsosThailandon behalf of TTTA, 78 per cent of retailers believe the new regulations will negatively affect their businesses.
Seventy two per cent of retailers believe more education and 50 per cent believe better enforcement of current laws would be more effective in reducing smoking rates than would the introduction of new regulations.
At a time when retailers expected economic conditions to worsen next year, it might be counter-productive of the government to experiment with costly tobacco regulations that would hurt retailers but do very little, if anything at all, to reduce smoking levels, said Varaporn.
The new provisions have undergone four public hearings and are open to the public for comments. The process should be finished next month.
At that time, the provisions will be submitted to the health minister and the cabinet.
Japan Tobacco Inc’s domestic cigarette sales volume during October, at 10.0 billion, was up by 4.2 per cent on its October 2011 volume, 9.6 billion, which itself was increased by 160.4 per cent on that of October 2010, according to preliminary figures issued by the company today.
Volume during the seven months, April-October, at 69.5 billion, was up by 15.0 per cent on its April-October 2011 volume, 60.5 billion, which was down by 33.0 per cent on that of April-October 2010.
JT’s market share for April-October 2012 was 59.5 per cent, against 54.9 per cent for the full year to the end of March.
JT has suffered huge volume swings in recent times because of an unprecedented, mainly tax-driven price hike on October 1, 2010, and the massive disruption caused to the company’s manufacturing and distribution operations following the earthquake and tsunami of March 11 last year.
JT’s domestic cigarette revenue during October, at ¥54.8 billion, was up by 4.1 per cent on its October 2011 revenue, ¥52.7 billion, which was up by 157.4 per cent on that of October 2010.
Revenue during April-October, at ¥382.8 billion, was up by 15.3 per cent on its revenue during April-October 2011, ¥332.1 billion, which was down by 10.6 per cent on that of April-October 2010.
Names are being gathered on an on-line petition calling for the Obama administration to inform the public that nicotine is a dangerous drug with no medical value, and to re-classify it as a controlled substance.
The petition, created on November 11 and aiming for 25,000 signatures, had 13 signatures by November 16.
The reasons given for creating the petition were:
1. ‘Nicotine is a powerfully addicting drug with no medical or mental health benefit.
2. ‘It is sold only to enrich those who sell it.
3. ‘Nicotine causes irreversible brain damage in the majority of users.
4. ‘Limited exposure to nicotine is highly likely to cause a mental craving for nicotine that does not go away in the victim’s lifetime.
5. ‘The CDC advises that the vast majority of nicotine addicts want to stop using nicotine, and cannot.
6. ‘There is no cure for nicotine addiction, and no treatment with a reasonable combination of safety and effectiveness.
7. ‘Nicotine addiction takes place within the first few days of nicotine use. Once addicted, addicts are chained to an unnecessary major expense, and are at elevated risk for early death. This is because long-term use of nicotine damages human cells.’
Thirty of the 50 largest cities in the US are now ‘smoke-free’, according to a HealthDay story quoting the findings of a new report.
The 60 per cent of large cities that are tobacco smoke-free have laws that prohibit tobacco smoking in all indoor areas of private workplaces, restaurants and bars.
In late 2000, only one of the 50 largest US cities, San Jose, California, had such a comprehensive smoke-free law.
As of October 5, 16 of the 50 largest cities were covered by local tobacco smoke-free laws, and 14 more were covered by state tobacco smoke-free laws, according to researchers at the US Centers for Disease Control and Prevention.
The Canadian Cancer Society has relegated Bangladeshto 97th position among 198 countries in introducing graphic health warnings on tobacco packs, according to a story in the New Age.
The society announced the ranking on Wednesday at the fifth meeting of the parties of the World Health Organization’s Framework Convention on Tobacco Control in Seoul, South Korea.
Bangladesh had ranked 77th in the previous report published in 2010.
The society said thatCanadawas the first country to implement picture warnings in 2001.
Bangladeshhas a population 4-5 times that ofCanadabut a GDP only about one twentieth the size of Canada’s.
Tobacco growers in the West Nusa Tenggara province of Indonesia say that low demand and declining prices for flue-cured are threatening their livelihoods, according to a story in The Jakarta Post.
The farmers, who are expecting to make big losses on this year’s harvest, are asking the provincial administration to intervene in the market.
The price of flue-cured currently ranges between Rp3,000 (US31¢) and Rp5,000 per kg, down from between Rp30,000 and Rp35,000 per kg last year.
“The companies are manipulating the prices as they wish,” said Lalu Musdar, a farmer from Janapria, Central Lombok. “We want the governor to urge them to buy tobacco from us at a fair price.”
Musdar, who planted flue-cured on more than 1.3 ha of his farm in Janapria, said he would suffer losses of up to Rp70 million if he failed to sell his tobacco.
Production costs have risen this year and Musdar said that farmers might make a little profit if the price were Rp30,000 per kg. “For our production expenses, we borrowed from the co-operative and loan sharks at a high interest rate,” Musdar added.