Category: News This Week

  • Postal Service Publishes E-Cig Mailing Guidance

    Postal Service Publishes E-Cig Mailing Guidance

    Photo: Sean Locke Photography

    The United States Postal Service (USPS) has published its guidance for mailing vaping products in the Federal Register. The notice provides some clarity on USPS policy and outlined potential exceptions, which could include legal hemp and its derivatives.

    Until the final rule is issued, ENDS are not subject to the Prevent All Cigarette Trafficking (PACT) Act. The USPS suggests it may exempt cannabis products, but also says that it will not review any exemption applications before the rule is finalized. The agency did, however, state that it has attempted to streamline the application process.

    “The Postal Service understands that those concerns are heightened by Congress’s decision to make ENDS nonmailable immediately upon publication of the final rule, rather than applying the 30-day notice period that typically follows a final rule under the Administrative Procedure Act,” the USPS wrote. “

    If any of the relevant exceptions are ultimately made available, then, given the highly decentralized nature of the ENDS industry relative to the industries historically covered by the PACT Act, the Postal Service anticipates receiving ENDS-related exception applications at a rate several orders of magnitude above the historic norm.

    U.S. Postal Service

    “Therefore, this document is intended to clarify the state of the exception application process in advance of the final rule and to provide guidance to mailers interested in availing themselves of any exceptions that may ultimately be made available.”

    The USPS anticipates many applications for exemption to its mail ban. “If any of the relevant exceptions are ultimately made available for [electronic nicotine delivery systems (ENDS)], then, given the highly decentralized nature of the ENDS industry relative to the industries historically covered by the PACT Act, the Postal Service anticipates receiving ENDS-related exception applications at a rate several orders of magnitude above the historic norm,” the guidance reads.

    The USPS mail ban is only one of several challenges to the vapor business created by the recent legislation. Among other requirements, the PACT Act also stipulates that manufacturers register with the Bureau of Alcohol, Tobacco, Firearm and Explosives (ATF), as well as file monthly reports with state tobacco tax administrators.

    Recipients of all vaping products purchased online are now required to present ID and sign for their delivery, regardless of the carrier. Many states are expecting businesses to start filing monthly reports on May 10 and the USPS is expecting to post the final rule and officially end the mailing of ENDS products to consumers on April 27.

  • Kaival and Bidi Vapor Continue Cooperation

    Kaival and Bidi Vapor Continue Cooperation

    Kaival Brands approved an amended and restated distribution agreement, which sets forth the terms of the formal relationship between Kaival Brands and Bidi Vapor. The newly amended and restated distribution agreement extends the previous one-year, annually renewable term to an initial term of 10 years, which automatically renews for another five-year term provided that Kaival Brands satisfies certain minimum purchase thresholds.

    The newly amended and restated distribution agreement also provides Kaival Brands with a right of first refusal in the event Bidi Vapor receives an offer that would constitute a “change of control transaction” as well as a right of first refusal to act as the exclusive distributor of any and all future products of Bidi Vapor that arise out of or related to electronic nicotine-delivery systems (ENDS) and components related to ENDS, arise out of or relate to the synthetic nicotine industry, or arise out of or related to the tobacco-derived nicotine industry.

    “We believe the amendments to the distribution agreement further bolsters the commitment between the two companies,” said Niraj Patel, president, CEO and chief financial officer, in a statement. “The relationship between Kaival Brands and Bidi Vapor during the past 12 months has been fruitful, with Kaival Brands generating approximately $100 million in revenues during the previous 12 months from the sale of the Bidi Stick and expanding its distribution of the Bidi Stick to more than 50,000 stores.”

  • New Glue Additives from Tobacco Stalks

    New Glue Additives from Tobacco Stalks

    Photo: Inok

    The Philippine Department of Science and Technology (DOST)—Forest Products Research and Development Institute (FPRDI) has developed glue additives from tobacco stalks and tea leaves, reports the Manila Bulletin. The new additive would reduce the cost of producing plywood.

    “After several formulations and tests of the experimental plywood, the glue mixes that produced the desired improved properties were piloted to produce full-size plywood in two plywood factories in Sariaya, Quezon and Valenzuela City,” said Fortunato T. de la Pena, DOST secretary.

    “Based on factory trials, the FPRDI-developed formulations could match the commercial glue mix formulation’s performance, showed lower formaldehyde emission and improved termite resistance,” he said.

    Plywood is made of several layers of veneers that are bonded by adhesives that use fillers to improve the adhesive properties. Plywood manufacturers in the Philippines are currently using traditional additives of rice hull or coconut shell flour for fillers and wheat flour for extenders and the catalyst.

    The newly developed additives would reduce the cost of plywood production by PHP60 ($1.24) per panel, according to de la Pena.

    “The valued adding to the two waste materials would reduce solid waste disposal by converting them into useful products,” de la Pena said. “Tobacco stalks in the glue mix benefit the environment through reduction in air pollution and elimination of toxic pollutants in the soil as tobacco stalks are normally burned or allowed to decay in the field.”

    Tobacco stalks in the glue mix benefit the environment through reduction in air pollution and elimination of toxic pollutants.

    Fortunato T. de la Pena, DOST secretary

    Tobacco farmers would also benefit from using tobacco stalks for additives: “The socio-economic benefit of the technology would be the potential added income to tobacco farmers through selling and/or processing of waste stalks for the use of the plywood industry.”

  • Study Shows Reduced Exposure HnB Products

    Study Shows Reduced Exposure HnB Products

    Photo: Japan Tobacco

    Japan Tobacco has announced the results of a clinical study that demonstrates a reduction in exposure to, and uptake of, selected harmful and potentially harmful constituents in healthy Japanese adult smokers who switched to four in-market heated-tobacco products, including Ploom TECH+ and Ploom S 2.0.

    The study was conducted in consultation with a medical advisor, Yuji Kumagai, who is a professor at Kitasato Clinical Research Center.

    These results strongly underpin the potential of heated-tobacco products, including Ploom TECH+ and Ploom S 2.0, to reduce the health risks associated with smoking.

    Ian Jones, vice president and R&D principal scientist, JTI

    “With this study, the JT Group contributes another small but meaningful piece to the jigsaw of scientific evidence on heated-tobacco products. Although further research is required, these results strongly underpin the potential of heated-tobacco products, including Ploom TECH+ and Ploom S 2.0, to reduce the health risks associated with smoking,” said Ian Jones, JTI vice president and R&D principal scientist, in a statement.

    “We continue to conduct research to provide scientific evidence of the potential benefits of using our reduced-risk products. As we continue our studies, we will communicate our research data on our science website, JT-science.com,” said Jones.

  • Trade Body Calls For Tax Stamp Clarity

    Trade Body Calls For Tax Stamp Clarity

    Photo: Tobacco Reporter archive

    The International Tax Stamp Association (ITSA) is urging greater clarity around the definition of the tax stamps used to secure excise revenues from tobacco products.

    The move comes in the wake of the continued misuse of the term “tax stamp” by some sector solution providers, which is raising issues around specification and seem to contravene international standards.

    The ITSA says there is a lot of confusion over specific terms, notably the difference between tax stamps and the security feature labels used by some member states under the EU Tobacco Products Directive (TPD).

    The fundamental differences between tax stamps and secure labels pertain to functionality and the specifier/issuer. Stamps fundamentally serve a tax purpose and may fulfil other functions, such as those related to authentication, while secure labels should just be used for authentication purposes.

    Tax stamps play an important role in securing revenues as international supply chains continue to be threatened by counterfeiters and smugglers look to take advantage of the pandemic to trade in illicit tobacco.

    The latest figures indicate that the trade in fake tobacco is worth upward of $50 billion annually worldwide, according to a 2020 World Bank report, and accounts for approximately 600 billion illicit cigarettes per year.

    ITSA’s call comes as most EU member states use tax stamps to comply with the TPD’s security feature requirements while in five other states plus the U.K., which do not use tax stamps, the tobacco industry has opted for secure labels to ensure conformance with the TPD.

    Moreover, individual tobacco manufacturers contract directly with various printers for the provision of these labels rather than going through the national tax or other government authorities.

    The current situation is further exacerbated by the misuse of terminology in other parts of the world. In India, for instance, there are reports that state excise departments use the terms “excise adhesive label” and “security hologram” to refer to the same thing, which is adding to the confusion and highlighting the need for strong action around definitions, the ITSA said.

    Some sector solution providers continue to describe nontax labels as tax stamps when they are clearly not.

    Juan Carlos Yanez, chair, ITSA

    Juan Carlos Yanez, chair of the ITSA, said confusion reigns where there needs to be clarity. “The need for tax stamp programs has never been more timely as we see government revenues plummet, deficits rise and debt levels swell to eye-watering proportions in the face of the Covid pandemic.

    “So the differences between tax stamps and nontax-related secure labels must be clear and unequivocal to remove the doubts. Yet, some sector solution providers continue to describe nontax labels as tax stamps when they are clearly not.

    “Moreover, the use of the wrong terminology may contravene international standards and water down stringent recommendations of standards, notably ISO 22383:2020, covering guidelines for the selection and performance evaluation of authentication solutions for material goods, and ISO 22382:2018, covering guidelines for the content, security, issuance and examination of excise tax stamps.”

    A tax stamp is defined by ISO 22382 as a “visible stamp, label or mark placed on certain types of consumer goods to show that the applicable excise tax has been paid.” This identifies the key and unique function of a tax stamp, which is to show that the required tax on the item that the stamp is affixed to has been paid—the stamp acts as a receipt. It also recognizes that stamps may have other functions including those relating to legislative compliance such as complying with the security feature provisions of the TPD.

    Tax stamps are specified and issued under the authority of the appropriate tax authority, defined in ISO 22382 as “a government (national, provincial, state or local) agency that has responsibility for the collection of applicable taxes and for the specification and design of tax stamps.”

    Secure labels are normally specified and issued by the brand owner while tax stamps are state organization issued. The TPD is the exception to this in that it requires authentication labels to conform to an agreed national design and security specifications, with at least one security element on the label issued by an authorized and independent third party.

    “Tax stamp and traceability programs help governments protect and recoup much-needed revenues as they battle to secure excise and get their public finances back on track,” said Yanez. “So the bottom line as far as the difference between a tax stamp and secure label is concerned in this battle is that the latter doesn’t provide proof of tax paid while the former does.”

    Tax stamps can be an integral element of track-and-trace programs and best practice within the sector, effectively monitoring the location and movement of goods throughout the supply chain from manufacture to point-of-sale. A secure track-and-trace program works by assigning a unique individual identity to each item—a pack of cigarettes, for example—during the manufacturing process.

    Once assigned, the identity is stored in a secure database and updated every time there is a significant event, such as a change of ownership or payment of tax due and supports authentication throughout the supply chain. This produces a comprehensive product history; it means that if the pack or bottle is found in a place or state that is irregular, its provenance can be fully traced back and the responsible party held accountable.

    The digital traceability features of tax stamps, combined with their material security features and tamperproof functionality, are the most robust means to ensure tax compliance, audit optimization and product protection. Considering the highly detrimental and pervasive nature of the illicit trade of excisable products, great ills require great remedies.

  • Marposs Announces On-Line Diameter Control

    Marposs Announces On-Line Diameter Control

    Photo: Aeroel

    Aeroel by Marposs, a provider of measurement, inspection and test technologies, has launched the Xploreline.XY gauging system for reliable, accurate and contactless diameter gauge control of cigarette or filter-making machines. The Xploreline.XY systems can be installed on-line with either single or double-rod machines and perform continuous diameter monitoring during rod manufacturing to achieve 100 percent inspection of potential dimensional nonconformity.

    Each system includes a dual axis Xactum gauge intelligent laser sensor, which provides consistent, accurate measurement of the average rod diameter or rod circumference of fast-moving products. A special patented air-bracket device, specifically suited for on-line applications, is also included, ensuring the gauge self-cleans to protect against tobacco or paper dust.

    Diameter measurement data are transmitted to the machine’s numerical control through the serial line, Ethernet or Profibus interface. Using the diameter information, the controller can automatically adjust the machine and keep the rod size within the preset tolerance limits, which improves machine efficiency. Alarm outputs are triggered for any out-of-tolerance part. Off-line applications are also available to check the product size after production. 

    These compact systems are available in different models and measuring sizes. The Xploreline.XY13 has a measuring field of 13 mm x 13 mm, measurable diameters from 0.1 mm to 10 mm, and a repeatability of ± 0.2 µm and linearity of +/- 0.5 micron. The Xploreline.XY35 has a measuring field of 35 mm x 35 mm, measurable diameters from 0.2 mm to 32 mm, repeatability of ± 0.15 µm and linearity of +/- 1 micron.

    Each XLS gauge is programmed with dedicated software along with a display unit and remote control. Overall benefits include:

    • Continuous diameter control
    • No scrap: real-time inspection allows the system to detect out-of-tolerance trends and return the product back within specification, avoiding any risk of rejects or complaints
    • Material savings: keeping the product close to the lowest tolerance limit, considerable savings in materials can be achieved, allowing the cost of the system to be paid back in just a few months
    • Process automation: use machines with automatic change of collection reels or systems to coil spools up to a preset weight
    • Quality Certification: 100 percent inspection makes random sample checks redundant and allows printing of detailed reports to prove product quality
  • Stora To Close Mills in Sweden and Finland

    Stora To Close Mills in Sweden and Finland

    Stora Enso’s Kvarnsveden Mill in Sweden (Photo: Stora Enso)

    Stora Enso will start negotiations with employees at its Kvarnsveden Mill in Sweden and Veitsiluoto Mill in Finland regarding a plan to permanently close pulp and paper production at both mills. The planned closures would take place during the third quarter of 2021 and directly affect 670 people in Finland and 440 people in Sweden.

    Paper demand in Europe has declined for more than a decade. This trend has further accelerated due to the pandemic, which has led to changes in consumer behavior. As a consequence, there is a significant overcapacity in the European paper market, which has resulted in historically low price levels and challenged the cost competitiveness of many paper mills. Both Kvarnsveden and Veitsiluoto mills are loss-making, and Stora Enso expects their profitability to remain unsatisfactory.

    This is heavy news for our company and our colleagues at Veitsiluoto and Kvarnsveden mills.

    Annica Bresky, president and CEO, Stora Enso

    “This is heavy news for our company and our colleagues at Veitsiluoto and Kvarnsveden mills,” said Annica Bresky, Stora Enso’s president and CEO, in a statement.

    “Our people at the sites are very competent and have done their utmost during very difficult circumstances. Unfortunately, in the rapidly declining paper market, we need to adjust our production capacity to improve the competitiveness of our total paper business. This sadly means the closure of unprofitable assets.”

    “We have examined several options to improve the financial situation for Veitsiluoto and Kvarnsveden mills,” said Kati ter Horst, executive vice president of Stora Enso’s paper division. “However, none of these options have proved feasible in ensuring a cost competitive future for the mills. If there was a decision to close down the mills, we would work closely together with other Stora Enso locations, the cities of Kemi and Borlange, and other stakeholders to support in re-employment and training of the affected employees. We would also actively engage in discussions to find alternative future uses for the mill sites. Throughout this process, we will serve our customers in the best possible way.”

    The planned mill closures would reduce Stora Enso’s paper production capacity by 35 percent to 2.6 million tons per year.

  • Report Explores China’s Tobacco-Heating Market

    Report Explores China’s Tobacco-Heating Market

    Photo: David Mark from Pixabay

    Research and Markets has published a new report on the world’s largest potential market for heat-not-burn (HnB) products—China.

    The report provides an overview of China National Tobacco Corp. (CNTC) subsidiaries’ HnB marketing activities from 2017 to 2020.

    The report reviews all HnB products that were officially released in domestic and foreign markets as well as cooperation ties in the Chinese HnB market.

    China Tobacco has a market of 300 million smokers with a significant part being active HnB users. The domestic HnB sector is dominated by CNTC. It has launched HnB products in Sichuan, Yunnan, Guangdong, Anhui, Hubei, Heilongjiang and other provinces and has been actively engaged in overseas markets. CNTC HnB brands are presented in many foreign markets, mostly in Asian countries and eastern Europe.

    Most HnB devices are promoted with dedicated consumables. HnB devices are either produced at facilities of CNTC subsidiaries or are OEM versions developed by third-party manufacturers. The CNTC subsidiaries with the largest number of HnB devices in the domestic market are based in Sichuan, Yunnan and Guangdong.

    The report includes a brief review of HnB electronic devices produced in cooperation with major Chinese hardware manufacturers. There is also a brief description of companies engaged in the Chinese HnB market, and a complete list of HnB products with release dates and corresponding references in domestic and foreign markets, a map of presence of CNTC HnB brands in foreign markets and a timeline of CNTC HnB products by release date.

  • Turning Point Brands invests in Docklight

    Turning Point Brands invests in Docklight

    Turning Point Brands (TPB) has announced an $8.7 million strategic investment in Docklight Brands, a pioneering consumer products company with brands including Marley Natural cannabis and Marley CBD. In addition, TPB has obtained exclusive U.S. distribution rights for Docklight’s Marley CBD topical products. The investment into Docklight Brands’ Series A offering comes with certain follow-on investment rights.

    As a result of this transaction, Turning Point Brands now has access to two iconic names in cannabis: Bob Marley and Zig-Zag. The Marley CBD skincare line, which includes after-sun, hand cream, lip balm, balm and roll-on products, combines tropical botanicals with hemp-derived CBD and is currently available nationwide in the U.S. in over 12,000 stores, including select 7-Eleven, Circle K, Safeway and Dollar General locations, with additional availability expected through TPB’s partner network.

    The company’s investment into Docklight will also support the growth of the broader Marley CBD line, including Marley Mellow Mood teas, Marley wellness shots and Marley chocolate squares as well as Marley Natural THC products, which are produced and sold under license agreements in Canada, Jamaica and select U.S. states.

    “Our goal is to build an expansive portfolio of the most innovative brands in the cannabis industry and to distribute these products across our vast partner network,” said Larry Wexler, CEO of Turning Point Brands, in a statement.

    We are confident our strategic relationship with Turning Point Brands will greatly enhance both the visibility and availability of the Marley products across TPB’s extensive distribution network.

    Damian Marano, CEO, Docklight Brands

    “We reach consumers where they are most comfortable, selling products to distributors, selling to stores directly and interfacing with consumers one-on-one via e-commerce. Adding Marley products to our portfolio alongside our legacy Zig-Zag brand marks yet another milestone as we continue to leverage our brands and expand our distribution infrastructure.”

    “Given our shared focus on branded products, we are excited to expand the reach of the iconic Bob Marley brand. We are confident our strategic relationship with Turning Point Brands will greatly enhance both the visibility and availability of the Marley products across TPB’s extensive distribution network,” said Damian Marano, CEO of Docklight Brands.

  • U.S. House Passes Cannabis Banking Bill

    U.S. House Passes Cannabis Banking Bill

    Photo: Feelgoodsk | Dreamstime.com

    The U.S. House of Representatives on April 19 passed legislation that would allow banks to serve cannabis companies in states where it is legal, reports Reuters.

    The bill clarifies that proceeds from legitimate cannabis businesses would not be considered illegal and directs federal regulators to craft rules for how they would supervise such banking activity.

    Banks have generally been unwilling to do business with companies that sell marijuana or related products, fearing they could run afoul of federal laws.

    That has left companies in the marijuana industry with few options, including relying on just a handful of small financial institutions or doing business in cash.

    Thirty-six states have legalized medical cannabis while 17 states now allow adult use, according to the National Conference of State Legislatures.

    Lawmakers voted 321-101 to approve the bill and send it to the Senate.