Author: Taco Tuinstra

KT&G Prepares for Shareholder Meeting

Photo: KT&G
KT&G’s board of directors has tabled several items to be discussed at the company’s annual general meeting of shareholders on March 28. These items include the appointment of Kyung-man Bang as president and Min-kyu Lim as outside director as well as the Industrial Bank of Korea’s shareholder proposal of appointing Dong-hwan Shon as outside director and Agnes’ shareholder proposal of appointing Sang-hyun Lee as outside director.
The board has selected Kyung-man Bang, the current chief operating officer of KT&G, as the final CEO candidate, citing his extensive knowledge of the company’s overall business operations and his capability to steer the company through market challenges and toward the aspiration of becoming a “global top-tier” company.
Min-kyu Lim, nominated for the role of outside director, is renowned for his leadership at major listed companies in Korea, including as CEO of OCI Materials and SK Materials. His extensive expertise in organizational and risk management and sustainable business practices is also well regarded.
Sang-wook Kwak, an outside director candidate who will also serve as an audit committee member upon appointment, is counselor at Hwa Hyun, a Korean law firm. He previously served as chief of the Criminal Department at the Supreme Prosecutors’ Office of the Republic of Korea before assuming the role of inspection commissioner at the Board of Audit and Inspection.
“We have always valued the legitimate exercise of shareholder rights and have decided to table all shareholder proposals for the upcoming AGM without any objection, reflecting our respect for the integrity and purpose of shareholder proposals,” KT&G wrote in a statement. “We maintain close communication with all of our stakeholders, including shareholders, about KT&G Group’s future vision and growth strategies. Our commitment to maximizing the interests of all shareholders and enhancing the future value of the company remains steadfast.”
February 28, 2024
Pakistan: Growers Want Control Of Tobacco

Photo: Taco Tuinstra
Pakistani tobacco growers want control of the crop, stating that the federal government should no longer have authority over it because it is the domain of the provincial government under the 18th Amendment, reports Dawn.
The growers have said that the Pakistan Tobacco Board (PTB) has not looked out for their interests but rather the interests of the buyers and themselves.
“Its officials have played a controversial role and gave importance to their personal interest over the farmers’ interest,” said Khalid Khan, district president of the Kisan Board. “When PTB officials and representatives of the companies remain in league, how [will] the poor farmers survive?”
Azizur Rehman, a leading grower in Maneri Bala village, said that if the PTB and companies gave rights to the growers, it would improve growers’ financial positions and bring more people into the farming profession.
February 27, 2024
Arrest in North Korea Smuggling Case

Photo: Taco Tuinstra
A Chinese man who was arrested in Australia is awaiting extradition to the United States for allegedly selling counterfeit cigarettes in a North Korean scheme to generate revenue, according to Reuters.
“The individual is wanted to face prosecution in the United States for a number of sanctions, band fraud, money laundering and conspiracy offenses,” said a spokesperson for Australia’s Attorney-General’s Department. Jin Guanghua was arrested in Victoria and remains in custody.
According to an unsealed U.S. indictment, Jin, who is a Chinese citizen, allegedly committed bank fraud in an illegal scheme by North Korea to generate revenue through the purchase and sale of tobacco. The indictment stated that the North Korean banks used front companies to avoid U.N. sanctions.
According to the U.S. Federal Bureau of Investigation, Jin was one of three Chinese nationals acting as middlemen to purchase tobacco for companies owned by the North Korean government and military. The tobacco, which was purchased from international suppliers and shipped to Dalian, China, before being smuggled to North Korea, was used to manufacture counterfeit cigarettes to generate hard currency.
Jin was involved between 2009 and 2019, according to the indictment, and remains in custody “pursuant to the United States of America’s request for his extradition to face criminal charges in the United States.” A warrant for his arrest was executed in August, according to a spokesperson from a Victorian magistrates court.
Globally, North Korea is one of the largest producers of contraband cigarettes.
February 27, 2024
Penalties for Unauthorized Elf Bars

Photo: mehaniq41
On Feb. 26, the U.S. Food and Drug Administration announced the filing of complaints for civil money penalties (CMPs) against 20 brick-and-mortar retailers for the sale of unauthorized Elf Bar e-cigarettes. The FDA previously issued each retailer a warning letter relating to their sale of unauthorized e-cigarettes. However, follow-up inspections revealed that the retailers had failed to correct the violations, and the agency is now seeking the maximum penalty amount of $20,678 for a single violation from each retailer.
Including these complaints, the FDA has filed more than 100 CMP complaints against retailers for the illegal sale of Elf Bar e-cigarettes. Data indicate these products are appealing to youth. According to the 2023 National Youth Tobacco Survey, Elf Bar was the most commonly used brand among U.S. youth e-cigarette users; among middle and high school students who reported using e-cigarettes in the past 30 days, more than half said they used Elf Bar products during that period.
“These retailers have not adequately addressed the violations noted in previous warnings from FDA regarding the sale of unauthorized e-cigarettes,” said Brian King, director of the FDA’s Center for Tobacco Products. “Their continued failure to comply with the law is inexcusable, and as is evidenced by today’s actions, we’re committed to holding them accountable for it.”
As of Feb. 15, the FDA has issued more than 440 warning letters to and filed 100 CMP actions against retailers, including brick-and-mortar and online retailers, for selling unauthorized tobacco products. In addition to actions involving retailers, the FDA has issued more than 660 warning letters to manufacturers, importers and distributors for illegally selling and/or distributing unauthorized new tobacco products, including e-cigarettes. The agency has also filed CMP complaints against 50 e-cigarette firms for manufacturing unauthorized products and sought injunctions in coordination with the U.S. Department of Justice against seven manufacturers of unauthorized e-cigarette products.
February 27, 2024
Zimbabwean Shisha Production Set to Triple

Photo: Cavendish Lloyd
Zimbabwe is poised to produce more than 800 million kg of shisha tobacco this season, reports The Herald, citing statistics from the Tobacco Industry and Marketing Board.
According to the regulator, tobacco growers have planted 407 hectares of the crop this year, marking a 270 percent increase over last year’s hectarage.
Cavendish Lloyd, the only registered shisha tobacco contractor in Zimbabwe, expects better quality and yields this year as growers had gained experience and put into practice last year’s recommendations from buyers.
A company representative said he anticipated yields of between 2,000 kg and 2,300 kg per hectare.
Derived from imported seed varieties, the shisha flue-cured tobacco requires different agronomic practices than Zimbabwe’s traditional flue-cured crop.
The shisha tobacco is characterized by low nicotine levels (below 1 percent) and high sugar levels (above 25 percent). To achieve the lower nicotine levels, farmers grow 3,000 plants per hectare—double the number that is typical for Zimbabwe’s traditional flue-cured crop. The density ensures the plant competes more fiercely for nutrients, which in turn reduces nicotine levels.
In its inaugural year of commercial production (2023), shisha tobacco farmers earned an average of $3.15 per kilogram.
Tobacco Reporter profiled Cavendish Lloyd’s Zimbabwean shisha operations in its May 2022 print edition (see “Great Expectations”).
February 27, 2024
Habanos Reports $721 Million Turnover

Photo: Corporacion Habanos
Corporacion Habanos generated revenues of $721 million in 2023, up 31 percent compared to the previous year.
“The achievements of Habanos S.A. during 2023 are the result of the recognition of the unique origin of our tobacco, the strength and prestige of our brands, and, of course, the passion shared by all those involved in this fascinating world of Habanos,” Habanos’ co-presidents, Maritza Carrillo Gonzalez and Luis Sanchez-Harguindey, were quoted as saying in a press note.
“Thus, we celebrate 30 years of Corporacion Habanos, S.A., offering unparalleled moments and experiences to all lovers of premium tobacco in every corner of the world.”
With 27 brands and a presence in more than 130 countries, Habanos attributed its performance to “excellence, tradition and innovation.”
The company’s products are available on five continents. During 2023, the markets that contributed most to Habanos’ sales volume were Spain, France, China, Germany and Switzerland. By region, Europe remains the leading market for Habanos, accounting for 56 percent of total sales value, followed by Asia (21 percent), the Americas (13 percent) and Africa and the Middle East (10 percent).
In 2023, the company launched 31 new products, including Cohiba Siglo de Oro, Cohiba Ideales, Romeo y Julieta Cupidos, Hoyo de Monterrey Monterreyes No. 4 and Bolivar New Gold Medal.
During the Habano Festival this week, the company will be unveiling several additional products.
February 27, 2024
U.K. Poised to Announce Vaping Levy

Photo: spectrumblue
U.K. Chancellor Jeremy Hunt is expected to announce a “vaping products levy” during the presentation of the government budget on March 6, reports The Guardian.
The tax would be similar to 15 schemes in European countries, including Germany, where a €1.60 ($1.73) tax is charged on every 10 mL of vape liquid, and Italy where the rate is €1.30. The EU is also planning a vaping levy across the 27-nation bloc.
The U.K. tax would charge higher rates for products with more nicotine. There would also be a one-off increase in tobacco duty to ensure that vaping remains a cheaper alternative, with the two measures expected to raise more than £500 million ($633.73 million) a year by 2028–2029, according to The Times.
Prime Minister Rishi Sunak plans to ban smoking for the next generation by steadily increasing the legal smoking age in England so that tobacco would end up never being sold to anyone born on or after Jan. 1, 2009.
Vaping industry representatives described the tax plan as an attack on people trying to quit smoking.
“Vaping is proven to be the most effective way for smokers to quit and in doing so helps drastically reduce the cost of care the NHS [National Health Service] provides to smokers,” said John Dunne, director general of the U.K. Vaping Industry Association, in a statement.
“It makes absolutely no sense to make it more difficult for adults to stop smoking by penalizing those who choose a safer and healthier option in vaping. Smoking kills 250 people every day in the U.K. and according to Action on Smoking and Health costs the U.K. £17 billion a year,” Dunne added.
“A Centre for Economics and Business Research report in 2022 found that smokers switching to vaping saved the NHS £322 million, a figure that was estimated to more than double if 50 percent of U.K. smokers made the switch to vapes.
“Surely, we should be doing everything we can to help smokers escape a habit that kills so many. Increasing taxes on vaping will make vapes less accessible for the most disadvantaged in society who have the highest smoking rates and are most in need of an effective tool to quit.
“The government continue to hide their heads in the sand while taking actions that will fuel a black market which is already in danger of being out of control. Restricting access to vapes will not only mean more smokers; it will also mean more illegal and unregulated vapes. We need the government to license vape retailers and properly enforce the law against youth access before it is too late.”

It makes absolutely no sense to make it more difficult for adults to stop smoking by penalizing those who choose a safer and healthier option in vaping.
John Dunne, director general, UKVIA
“A Centre for Economics and Business Research report in 2022 found that smokers switching to vaping saved the NHS £322 million, a figure that was estimated to more than double if 50 percent of U.K. smokers made the switch to vapes.”
“Surely, we should be doing everything we can to help smokers escape a habit that kills so many. Increasing taxes on vaping will make vapes less accessible for the most disadvantaged in society who have the highest smoking rates and are most in need of an effective tool to quit.
“The government continue to hide their heads in the sand, while taking actions that will fuel a black market which is already in danger of being out of control. Restricting access to vapes will not only mean more smokers; it will also mean more illegal and unregulated vapes. We need the government to license vape retailers and properly enforce the law against youth access before it is too late.”
February 27, 2024
New Zealand to Scrap Generational Ban Today

Photo: dudlajzov
New Zealand was set to repeal its generational tobacco ban today, reports Reuters.
Scheduled to take effect from July, the measure would have banned sales of tobacco products to anyone born after Jan. 1, 2009, required tobacco companies to lower the nicotine content of their products and reduced the number of tobacco retailers by 90 percent.
Conceived by New Zealand’s previous government, the ban was abandoned after elections in October 2023 brought to power a new coalition. By treating the repeal as a matter of urgency, the government can scrap the ban without seeking public comment.
New Zealand’s reversal has attracted fierce criticism from public health advocates, who claimed the new government was doing the tobacco industry’s bidding.
“This is major loss for public health and a huge win for the tobacco industry—whose profits will be boosted at the expense of Kiwi lives,” Boyd Swinburn, co-chair of Health Coalition Aotearoa in New Zealand, was quoted as saying by Reuters.
Minister of Health Shane Reti has defended New Zealand’s plans to repeal the smoke-free legislation. He said his administration was committed to cutting smoking rates and referred to the potential of harm reduction tools such as vaping to help achieve the desired reductions.
February 27, 2024
New COP and MOP Bureaus Elected
Photo: butenkow
The 10th session of the Conference of the Parties (COP10) to the World Health Organization Framework Convention on Tobacco Control, held Feb. 5–10, 2024, in Panama City, elected new members for its Bureau. The Bureau shall serve until the closure of the following regular session of the Conference of the Parties (COP11), including for any intervening extraordinary session.
Reina Roa of Panama was elected president of the Bureau. The vice presidents will be Csaba Kontor of Hungary, Noraryana Binti Hassan of Malaysia, Jawad Al-Lawati of Oman, Nuntavarn Vichit-Vadakan of Thailand and Judith Segnon-Agueh of Benin.
Vichit-Vadakan will also act as rapporteur.
The following parties were designated to act as regional coordinators for the COP:
Cote d’Ivoire for the African Region;
Canada for the Region of the Americas;
Tunisia for the Eastern Mediterranean Region;
Spain for the European Region;
Timor-Leste for the South-East Asia Region; and
New Zealand for the Western Pacific Region.
The Third Session of the Meeting of the Parties to the Protocol to Eliminate Illicit Trade in Tobacco Products (MOP3), held Feb. 12–14, 2024, in Panama City, also elected its new Bureau. The new Bureau shall serve until the closure of the following regular session of the Meeting of the Parties (MOP4), including for any intervening extraordinary session.
Mansour Zafer Alqahtani from Saudi Arabia was elected president of the Bureau. The vice presidents are Hekali Zhimomi of India, Zliza Fantidou of Cyprus, Vimal Deo of Fiji, Omar Badjie of the Gambia and Marcos Dotta of Uruguay.
Deo will also act as rapporteur.
The following parties were designated to act as regional coordinators for the MOP:
Gabon for the African Region;
Paraguay for the Region of the Americas;
Islamic Republic of Iran for the Eastern Mediterranean Region;
Greece for the European Region;
India for the South-East Asia Region; and
Samoa for the Western Pacific Region.
February 27, 2024
Hernandez Retires from Altria Board

Image: Casimiro
Jacinto J. Hernandez retired from Altria Group’s board of directors effective Feb. 23, 2024. Hernandez will continue to serve Altria as a strategic advisor under a five-year agreement.
“We thank Jacinto for his service on our board,” said Kathryn McQuade, Altria’s independent board chair, in a statement. “Our board benefited from his industry experience and financial expertise.”
“I joined Altria’s board because I am inspired by Altria’s vision to responsibly lead the transition of adult smokers to a smoke-free future,” said Hernandez. “I am pleased that this agreement will allow me to focus my attention on helping Altria pursue its vision working directly with management.”
Hernandez is founder and principal of Cummings Consulting and Management. He previously served as a partner and investment analyst for Capital Group and its subsidiary, Capital World Investors.
He joined the Capital Group companies in August 2000 and retired in June 2022 after having spent 22 years covering a variety of industries, including U.S. tobacco, helping lead the research portfolio for one of the largest growth mutual funds in the world and serving in key leadership roles.
Hernandez is a director of Aris Water Solutions. He previously served as a director of Pioneer Natural Resources Co.
February 26, 2024