Category: News This Week

  • ‘Flavor Bans Failed to Reduce Youth Vaping’

    ‘Flavor Bans Failed to Reduce Youth Vaping’

    Photo: Pixel-Shot

    Restrictions on the sale of flavored tobacco products were not associated with a decrease in current or ever e-cigarette use among high school students in the California Bay Area one-year after their implementation, according to a new study.

    Researchers analyzed data from the California Healthy Kids Survey to look at e-cigarette use among high-school students in the California Bay Area. They compared changes in e-cigarette use between 2018 and 2019 among students attending school in a city with a flavored e-cigarette ban and students attending school in a city without a flavor ban.

    The researchers concluded that flavored vape bans “did not significantly change” the odds of current and ever e-cigarette use among students.

    Vapor industry advocates contend that flavor bans have negative consequences for public health because flavors are essential for adults trying to quit smoking. State finances are impacted by flavor bans as well. For example, Massachusetts’ ban on flavored vaping and tobacco products is costing the state an estimated $10 million in revenues each month, according to Americans for Tax Reform.

  • South Korea to Mandate New Health Warnings

    South Korea to Mandate New Health Warnings

    Image: Tobacco Reporter archive

    Cigarette manufacturers will have to start printing new graphic health warnings in late December, reports The Korea Herald, citing new regulations announced by the Ministry of Health and Welfare.

    The ministry plans to distribute the updated manual for labeling health warnings on cigarette packaging today, as a follow-up to the government’s tobacco industry regulation revision passed in June.

    New graphic health warnings specified in the document include a warning about second-hand smoking showing a rendered image of a newborn child sucking on a baby bottle stuffed with cigarette butts.

    The new rules, which come into effect Dec. 23, impact vapor products, too. E-cigarettes manufacturers will be required to cover more than 50 percent of each pack with health warnings, officials said.

  • EU Registers ‘Smoke-Free’ Citizens’ Initiative

    EU Registers ‘Smoke-Free’ Citizens’ Initiative

    Photo: areporter

    The European Commission has registered a European Citizens’ Initiative (ECI) to “achieve a tobacco-free environment and the first European tobacco-free generation by 2030.”

    The ECI urges the Commission to propose legislation banning the sale of nicotine products to people born in or after 2010 and to act against the environmental risks presented by tobacco use.

    The ECI also calls on measures to reduce cigarette litter, extend outdoor vaping restrictions and to eliminate tobacco advertising.

    By registering the ECI, the Commission acknowledges that it is legally admissible without expressing a view on the substance of the initiative.

    The organizers of the ECI now have six month start collecting signatures. If the initiative receives at least 1 million statements of support from citizens in at least seven EU member states within one year, the Commission will have to respond.

    The Commission can at that point take the request forward or reject it. If it rejects the ECI, the Commission will have to explain its reasoning.

    Introduced with the Treaty of Lisbon in 2007, the ECI initiative was created to increase direct democracy by empowering EU citizens to participate directly in the development of the union’s policies.

    Since the beginning of the ECI, the Commission has received at least 118 requests to launch ECI, 91 of which were admissible and thus qualified to be registered.

  • Gold Leaf Assets Seized

    Gold Leaf Assets Seized

    Photo: Comugnero Silvana

    The South African Revenue Service (SARS) on Aug. 26 took charge of all assets belonging to the Gold Leaf Tobacco Co. and those of its directors following a probe into tax evasion.

    According to News24, SARS investigators believe they have evidence that GLTC was involved in in money laundering and may owe up to ZAR3 billion ($177.7 million) in undeclared taxes.

    Fearing that GLTC’s assets alone may not cover its possible fiscal debts, the SARS targeted the assets of the assets of GLTC directors Simon Rudland and Ebrahim Adamjee.

    Yusuf Abramjee, the founder Tax Justice SA, described the development as a “huge breakthrough in the battle against the illicit cigarette trade.”

    “For over a decade, GLTC have been the prime suspects as South Africa’s illegal cigarette trade has grown into a national menace of devastating proportions,” he said.

    Rudland and Adamjee told the tax inquiry they had done nothing wrong and declared all GLTC’s taxes to SARS.

    The South African press has described Rudland as an “oligarch” associated with Zimbabwean President Emmerson Mnangagwa. “The Rudlands consistently make the news as members of the powerful political and economic elite in Zimbabwe, propping up [Zimbabwe’s governing party] Zanu-PF,” wrote The Daily Maverick.

  • Court Upholds Public Housing Smoking Ban

    Court Upholds Public Housing Smoking Ban

    Photo: stockelements

    The U.S. Department of Housing and Urban Development (HUD) is entitled to ban smoking in federally subsidized public housing, an appeals court ruled on Aug. 25, reports Reuters.

    The D.C. Circuit Court of Appeals decided that the HUD properly enacted a 2016 rule requiring state and local public housing agencies to ban cigarettes, cigars and pipes inside housing units and indoor common spaces, and outside within 25 feet of those areas.

    Six tenants and a smokers’ rights group challenged the ban, saying it improperly invaded their privacy and violated due process by preventing them from engaging in lawful activity—using tobacco—inside the home.

    But Chief Judge Sri Srinivasan said HUD provided “considerable” evidence that the rule helped protect residents against the health risks of secondhand smoke, prevent fires and reduce property maintenance costs. The HUD, he said, did not act arbitrarily and capriciously in promulgating the rule.

    Srinivasan also rejected a claim that the ban improperly restricted how the government spends money, violating a provision of the U.S. Constitution governing federal spending.

    The plaintiffs plan an appeal, arguing that the case involves significant issues involving federalism and whether Congress actually empowered HUD to ban smoking.

    Srinivasan’s decision in NYC CLASH Inc et al v Fudge, D.C. Circuit Court of Appeals, No. 20-5126 upheld a March 2020 lower court ruling.

  • Zambia Expects $92 Million From Tobacco

    Zambia Expects $92 Million From Tobacco

    Photo: Taco Tuinstra

    Zambia expects to increase its tobacco harvest by a quarter and generate $92 million from leaf sales at the close of the marketing season in September, reports Farmers Review Africa.

    By Aug. 12, the country’s tobacco growers had sold 35 million kg of leaf through the approval sales floors against projected sales of 33 million kg. Flue-cured Virginia accounted for 27 million kg and burley represented 6 million kg of the leaf sales.

    Agriculture Minister Reuben Mtolo told the International Tobacco Growers Association’s Africa Congress in Lusaka on Aug. 24 that the sector had performed well during the season despite various headwinds coupled with low investment.

    He said the government is committed to creating an investment-friendly environment.

    “The government is now in the process of enacting a new legal framework for the industry that will bring about effective regulation and foresee improved private stakeholder participation across the tobacco value chain,” said Mtolo.

    Zambia’s eighth national development plan emphasizes crop diversification and increasing profitability among all actors within the value chain.

  • STG’s Quarterly Sales Down in ‘Difficult’ Year

    STG’s Quarterly Sales Down in ‘Difficult’ Year

    Photo: STG

    Scandinavian Tobacco Group’s (STG) net sales and EBITDA declined 2 percent and 15 percent, respectively, for the second quarter of 2022 against a strong second quarter last year. The company cited lower-than-expected productivity in its supply chain, resulting in lower production volumes and higher costs. While anticipating improvements in the second half of the year, STG expects the delay to impact its full-year net sales and costs negatively.

    According to STG, the level of the production backlog was almost DKK150 million ($20.12 million) by the end of July. “However, as the improvements kick in combined with pricing initiatives across the product categories and easier year-on-year comparisons, we expect to return to EBITDA growth in the second half of the year,” the company wrote in a statement.

    Niels Frederiksen

    “2022 has turned out to be a difficult year for Scandinavian Tobacco Group, and we have had to adjust our full-year expectation for organic EBITDA growth,” said STG CEO Niels Frederiksen. “This development is disappointing and is primarily driven by temporary challenges in our supply chain and to a lesser extent by more cautious consumer behavior especially in the important U.S. handmade cigar market.

    “Still, we maintain our financial expectations of delivering strong cash flows and positive EPS growth for 2022, and we continue to implement our Rolling Toward 2025 strategy. The acquisition of Room101 as well as the continued expansion of our retail footprint in the U.S. are good examples of this. Overall, we remain confident in the strength of our underlying business and our cash flow.”

  • Vuse Extends Lead Over Juul

    Vuse Extends Lead Over Juul

    Photo: BAT

    The prospect of a potential on sales of Juul Labs e-cigarettes in the U.S. has helped accelerate the market share gains of R.J. Reynolds Vapor Co.’s Vuse brand, reports the Winston-Salem Journal.

    According to the latest Nielsen analysis of convenience store data, which covers the four-week period ending Aug. 13, Vuse’s market share rose from 37.4 percent in the previous report to 39 percent compared with Juul declining from 30.7 percent to 29.4 percent.

    Meanwhile, No. 3 Njoy dropped 3 percent to 2.9 percent while Fontem Ventures’ blu e-cigarettes slipped from 1.7 percent to 1.6 percent.

    In June, the Food and Drug Administration rejected Juul Labs’ premarket tobacco product applications, saying that the company has submitted insufficient evidence that its products were appropriate for the protection of public health. 

    While the agency subsequently suspended its marketing denial order (MDO), citing scientific issues in the application that warrant additional review, the agency stressed that the stay does not rescind the MDO, leaving Juul in limbo.

    Vuse, by contrast, has received FDA marketing approval for several product varieties, including Vuse Vibe and Vuse Ciro and Vuse Solo products.

    In a note to investors, Goldman Sachs analyst Bonnie Herzog said that Juul’s market share decline occurred in part “following confusion around the FDA’s marketing denial order against Juul.”

    As recently as May 2019—before the company started withdrawing flavored products in response to regulatory pressures—Juul accounted for 74.6 percent of the U.S. e-cigarette market.

  • VLN Recognized as ‘Best New Product’

    VLN Recognized as ‘Best New Product’

    Photo: 22nd Century Group

    22nd Century Group’s VLN King and VLN Menthol King reduced-nicotine content cigarettes have been awarded Best New Product in the cigarette category by Convenience Store News.

    Now in its 26th year, the Best New Products Awards recognize the most innovative, high-quality products introduced into the convenience channel to meet consumers’ evolving needs and fit a convenience store’s value proposition. This is the first Convenience Store News award in the cigarette category.

    “We are honored and excited that VLN was recognized with the Best New Product award in the cigarette category by Convenience Store News,” said John J. Miller, president of 22nd Century’s Tobacco Business, in a statement.

    “VLN is truly a game-changer, and this award confirms the market’s interest in VLN and their interest in new tools to help adult smokers smoke less. Our VLN pilot has exceeded expectations in Chicago, and we are now expanding our VLN launch statewide in Colorado as we work to broaden availability of this important new product.”

    The Best New Products Awards are judged by a panel of consumers on value, convenience, appearance and packaging along with attributes such as taste and ingredients. Judging was supervised and tallied by Past Times Marketing, a New York-based consumer research and product testing firm.

  • Dunne: Illicit Vapes a Big Problem in U.K.

    Dunne: Illicit Vapes a Big Problem in U.K.

    John Dunne (Photo: UKVIA)

    Up to 60 percent of disposable vapor products sold in the U.K. are illicit, according to the U.K. Vaping Industry Association (UKVIA).

    Speaking to the U.K. trade publication Convenience Store, UKVIA Director General John Dunne estimated that between 40 percent and 60 percent of disposable vapes currently on sale in the country were either noncompliant with domestic laws or counterfeit.

    “Based on the amount of [illicit] products I see in the marketplace, the number of reports of illicit sales and what’s being reported to trading standards, I believe it’s that big and a huge concern,” he explained. “I probably receive between 200 [reports] and 400 reports of illegal sellers in the U.K. every month.”

    Dunne warned that noncompliance among retailers could destroy a category with huge potential. “This is a market that has huge growth potential for retailers, if it’s allowed [to] grow in a responsible manner, but having a short-term view and ignoring compliance is going to have a detrimental effect. And potentially lead to things like the category being banned, flavor bans or plain packaging.”

    He also called for more action on retailers found to be selling vaping products to those under the age of 18.