Author: Staff Writer

Momentum Continues for Swedish Match

Lars Dahlgren (Photo: Swedish Match)
Swedish Match reported sales of SEK4.5 billion ($518 million) in the second quarter of 2021, up 9 percent from those reported in the second quarter of 2020. Operating profit was SEK1.96 billion compared with SEK1.69 billion in the 2020 quarter. The company’s operating margin increased to 45 percent from 42.9 percent from quarter to quarter.
The performance was driven by continued momentum for Swedish Match’s ZYN nicotine pouch in the U.S. Sales and operating profit also grew in Scandinavia.
For the cigars product segment, sales and operating profit were up significantly in local currency compared to a relatively soft prior year period due to improved pricing and increased natural leaf shipments.
“Following an impressive financial performance in the first quarter, Swedish Match today reported another quarter with double-digit sales and operating profit growth across all product segments in local currencies,” said Swedish Match CEO Lars Dahlgren in a statement.
“Our strategic focus on growing categories and segments is paying off as consumers are seeking alternatives and enhanced experiences.”
“Swedish Match is very well positioned to build upon its strong platforms, and we are excited to determinedly pursue the growth opportunities that lie ahead while working toward our vision of a world without cigarettes.”
July 21, 2021
EU Sanctions Target Belarus Tobacco Sector

Photo: andriano_cz
New economic sanctions placed on Belarus by the European Union focused on seven economic sectors, which include petroleum, finance, arms and surveillance technology, and the nation’s tobacco-processing business.
Belarus’ lucrative tobacco-processing industry—the source of a flourishing trade in cigarettes smuggled to the EU—was also targeted with bans on exporting to Belarus goods used in the manufacture of tobacco products. The goods listed include filters, cigarette papers, tobacco flavorings and machinery.
Belarus is a dominant player in cigarette smuggling, which rebounded recently with the increase in EU excise duties on cigarettes and the banning of menthol cigarettes in the bloc. With the average price of a pack of cigarettes in Belarus running the equivalent of about $0.80 compared to $4.30 in Latvia and much higher in other parts of the EU, there is plenty of room for profit in smuggling.
Cigarettes are a huge moneymaker for Belarus and for one of the country’s richest men, Alyaksey Aleksin, who now finds himself among the 166 individuals blacklisted from traveling or doing business with the EU. Aleksin, who was involved in the construction of a new tobacco factory in Minsk, is a major player in the distribution of cigarettes in Belarus and in recent years by presidential decree gained the exclusive rights both to import tobacco and to sell products both at home and abroad produced by the Hrodno Tobacco Factory, Belarus’ largest cigarette manufacturer.
July 20, 2021
Zimbabwe: Leaf Sales Up by a Third in 2021

Photo: Taco Tuinstra
Zimbabwe sold 186.6 million kg of leaf tobacco valued at $515.9 million during the 2021 marketing season, reports All Africa, citing data from the Tobacco Industry Marketing Board (TIMB). The figures are up 16.8 percent in volume and 31 percent in value over the 2020 sales.
The TIMB noted that contract farming was the dominant supplier of tobacco, accounting for 93.4 percent of total sales compared to 6.6 percent for sales on auction floors. Average leaf prices ranged between $2.47 and $2.82 per kg.
After gold, tobacco is Zimbabwe’s biggest foreign currency earner with expected earnings to increase from last year’s $452 million to $800 million. “The tobacco’s potential is immense,” said Agriculture Minister Anxious Masuka, who wants to increase tobacco leaf production over the next four years. “It is in this regard that the government, together with stakeholders in the industry, is at an advanced stage of developing a three-pronged strategy. First, to increase annual production to 300 million kg largely from small holder farmers by 2025.”
Industry analysts, however, have criticized Zimbabwe’s plans for not outlining a value addition strategy arguing that improving general output will not yield much benefit. By only exporting raw tobacco leaf, Zimbabwe could be losing out on at least $5 billion annually.
July 19, 2021
Rwanda Working on Anti-Tobacco Laws

Photo: Taco Tuinstra
Rwanda’s Parliament has ordered the Ministry of Health in the next three months to formulate a strategic plan on how it intends to raise awareness about the negative effects of tobacco and its prohibition among minors, reports The New Times.
Although one must be at least 18 years old to purchase or consume tobacco products, research indicates that those as young as 15 are also consuming them. Member of Parliament Germaine Mukabalisa noted that some children are exposed to cigarette consumption at an early age in markets and boutiques, which could influence children to believe that cigarette smoking is acceptable across all age groups.
Mukabalisa proposed that the government tackle the promotion of tobacco use on social media platforms where youth are present. Rwanda does have high cigarette import duties, which do reduce cigarette imports, according to Uwamariya. MPs have also recently asked the government to designate public smoking areas.
July 19, 2021
South Africa Asked to Tackle Smuggling

Photo: Tobacco Reporter archive
The major legal cigarette manufacturers in South Africa have called on the South African Revenue Service and law enforcement agencies to increase their efforts to prevent criminal networks from selling illicit cigarettes, reports Food for Mzansi.
During June, about ZAR17 million ($1.2 million) worth of illicit cigarettes were destroyed, following the destruction of ZAR30 worth of illicit cigarettes at the Beit Bridge border post earlier in the year. In all, 181 million cigarettes valued at ZAR219 million ($15.1 million) have been seized and destroyed so far this year.
Zacharia Motsumi, spokesperson for the South Africa Tobacco Transformation Alliance, which represents the legal tobacco value chain, said, “We have seen some significant action in recent weeks, but it’s going to take a combined national effort to completely stamp out the illicit traders. We are suffering huge losses because of the illicit cigarette networks, and more action is needed to arrest the perpetrators and destroy their illicit products.
“We need to put a stop to their nefarious activity—it is destroying jobs and also robbing the country of tax revenue. The seizures and confiscations are significant, but they are just the tip of the iceberg. The illicit trade continues to cause massive harm to the economy and punishes farmers, processors and manufacturers who go about their business in a law-abiding way.”
July 19, 2021
Taat Expands Production/Warehousing

Photo: Taat Global Alternatives
Taat Global Alternatives has finalized a lease agreement for new facilities to expand the company’s manufacturing and warehousing capacities in Las Vegas, Nevada, USA. Combined with the company’s existing facility, the new facilities will considerably increase the company’s total operating space and can allow for the creation of new internal departments for purposes such as digital content production and event management.
With new U.S. launches of Taat in motion and fulfillment underway for the company’s first international order to a distributor in the United Kingdom, this facility expansion is a proactive effort to ensure the company has sufficient capacity to meet foreseeable demand. Over the past nine months, Taat has been placed in more than 300 U.S. retail stores, and cartons of Taat have been shipped to smokers aged 21 and up in 37 states through e-commerce sales.
Although its existing facility can produce enough base material for approximately 680,000 10-pack cartons of Taat per year, the company believes it to be prudent to increase this manufacturing bandwidth as product launches are occurring in new markets.
In the company’s new warehouse facility, it will be possible to store approximately 181,400 kg of the Beyond Tobacco base material (compared to approximately 68,000 kg at the current facility) after it is finished and awaiting shipment to a contract cigarette manufacturing partner. In addition to standard climate controls, this storage space also has humidity control functionality, which can be used to keep the base material fresh, thereby extending its shelf life.
To efficiently facilitate the fulfillment of direct-to-consumer e-commerce orders as well as wholesale purchase orders of finished Taat products, the fulfillment station at the company’s new warehouse will be over 200 percent larger than its current size in the existing facility. The new fulfillment station will also have four loading doors at “dock height,” which can reduce pickup and drop-off times for logistics providers. The company is also evaluating technologies and solutions that could further optimize in-house order fulfillment with this additional space.
“Expanding and upgrading the company’s operating facilities after barely three calendar quarters of selling Taat at retail is an excellent indicator of our progress in my opinion,” said Taat Chief Executive Officer Setti Coscarella in a statement.
July 18, 2021
Kaival Brands Secures Patents in China

Photo: vegefox.com
Kaival Brands Innovations Group has been granted two copyright protections and two patents by China.
The first patent, China Patent No. 202020067263.5, is a utility model patent and relates to the nozzle components of the Bidi Stick. The nozzle components play an integral role in delivering a consistent user experience. The second patent, China Patent No. 202030052391.8, is a design patent that covers the entire Bidi Stick product. Bidi Vapor has also secured copyrights for both the Bidi Stick and Bidi Cares names.
Kaival believes that the Chinese vapor market presents a considerable business opportunity. Statista data projects the China combustible cigarette market to top $220 billion in 2021. Vape products are quickly gaining market share in China, and if a mere 10 percent of combustible cigarette smokers transition to vape, China would be a $22 billion vape market opportunity. By comparison, Grandview Research anticipates the U.S. vape market to reach $7.4 billion in 2021.
“The copyright and patent protection representations received from China are the first step in our planned journey to introducing the Bidi Stick into one of the world’s largest markets for vape products, China,” said George Chuang, independent director of Kaival Brands, in a statement. “I look forward to advising the company in my role as a board member in interfacing with potential distribution partners in China.”
“Receiving two patents from China, along with copyright protections, should enhance our efforts to more effectively eliminate counterfeit players from the market, and being afforded these protections within a difficult market further validates our best-in-class product lineup,” says Niraj Patel, founder and chief executive officer of Kaival Brands and Bidi Vapor. “Both Bidi Vapor and Kaival Brands are adamant about exceeding compliance standards in every global market, and as such, our products are intended exclusively for adults 21 and over.”
Following the latest patents, Kaival has intellectual property protections in the United States, the European Union, Australia and China. “We believe this puts us in a strong position to pursue new global markets that we have already received regulatory approval to enter,” says Patel.
July 18, 2021
Companies Ask FedEx to Reverse Vape Mail Ban

Photo: Sundry Photography
More than 400 vapor companies have urged FedEx to reverse a policy prohibiting shipping and receiving vaping products. The American Vaping Association (AVA) sent a letter to FedEx insisting that the delivery ban will prevent consumers from obtaining vapor devices and e-cigarettes they’ve used to stop smoking.
FedEx’s current rules, following the changes to the Preventing Online Sales of E-Cigarettes to Children Act, prevent shipping vaping products from business to business or directly to vapers.
“We rely on companies like FedEx to stock our store shelves and meet customer demand,” the letter reads. “Without the option to order vaping products at wholesale or ship their products to consumers, vape stores have seen their shipping options skyrocket in cost or evaporate entirely. If consumers are not able to access or afford these reduced-risk alternatives to cigarettes, they will be forced to turn back to combustible tobacco, which is far more dangerous and will have life-long consequences on their health.”

FedEx is doing a great disservice to American small businesses and consumers. They are playing right into the hands of Big Tobacco, which directly benefits from policies that make it more expensive for adult smokers to switch.
Greg Conley, president, AVA
“FedEx is doing a great disservice to American small businesses and consumers,” said Greg Conley, president of the AVA. “They are playing right into the hands of Big Tobacco, which directly benefits from policies that make it more expensive for adult smokers to switch. Not only are vaping products legal and regulated by the Food and Drug Administration, but they are saving lives by keeping people off combustible cigarettes.”
July 16, 2021
New Technique Reduces Harmful Compounds

Photo: orestligetka
New research by North Carolina State University shows a new technique that can alter plant metabolism, which, when tested in tobacco plants, showed that it could reduce harmful chemical compounds, reports Science Daily.
“A number of techniques can be used to successfully reduce specific chemical compounds, or alkaloids, in plants such as tobacco, but research has shown that some of these techniques can increase other harmful chemical compounds while reducing the target compound,” said De-Yu Xie, professor of plant and microbial biology at North Carolina State University and the corresponding author of a paper describing the research.
“Our technology reduced a number of harmful compounds—including the addictive nicotine, the carcinogenic N-nitrosonornicotine (NNN) and other tobacco-specific nitrosamines (TSNAs)—simultaneously without detrimental effects to the plant.”
The technique uses transcription factors and regulatory elements as molecular tools for new regulation designs. The paper appears in Journal of Advanced Research. Research associate Mingzhu Li is a first author of the paper. Former postdoctoral fellows Xianzhi He and Christophe La Hovary are co-first authors. The research was supported by R.J. Reynolds Tobacco Co.
July 16, 2021
Steve Tzimoulis Joins Nicos Gleoudis Kavex

Photo: akub Jirsák | Dreamstime.com
Steve Tzimoulis has been appointed director of sales of Nicos Gleoudis Kavex effective July 1, 2021.
Tzimoulis joins Nicos Gleoudis Kavex from Philip Morris International where he held numerous managerial positions in leaf buying, product development and manufacturing in multiple markets around the world for the past 36 years.
July 16, 2021