Category: News This Week

Malawi President Urges Diversification

The tobacco sales floors in Lilongwe (Photo: Taco Tuinstra)
Malawi’s President Lazarus Chakwera wants tobacco farmers to switch to other cash crops because he sees no future in the golden leaf, reports The Voice of America.
At the opening of tobacco selling season on Tuesday, Chakwera said Malawi should switch to other cash crops like cannabis, which was legalized last year for industrial and medicinal use. In preparation for cannabis cultivation, the country recently created a Cannabis Regulatory Authority.
Tobacco currently contributes more than 60 percent of the country’s export earnings, but demand for the leaf has been declining due to growing health awareness and global anti-smoking campaigns.
“We need an exit strategy to transition our farmers to crops that are more sustainable and more profitable,” Chakwera said.
“I am therefore calling on the Ministry of Agriculture to begin consultations with all stakeholders to come up with a timeframe within which Malawi’s economy will be completely weaned from tobacco.”
We need an exit strategy to transition our farmers to crops that are more sustainable and more profitable.
Lazarus Chakwera, president, Malawi
In the meantime, Malawi should promote greater competition in the tobacco industry by attracting more leaf buyers beyond the current nine, Chakwera said, suggesting that competition would increase prices.
In March, Malawi’s government signed an agreement with tobacco leaf buyers and set a minimum price of about $2.30 per kg. In the past, buyers would offer as little as $0.50 per kg of tobacco.
Skeptics said it could be difficult for tobacco farmers to switch to cannabis, citing skills and climate conditions, among other considerations.
Tobacco Reporter detailed the challenges facing Malawi’s tobacco sector in its July 2017 print edition (See “On the Map.”)
April 21, 2021
Shares Slide on Nicotine Reduction Discussions

Photo: Tumisu from Pixabay
Shares in big tobacco companies plunged on Tuesday following reports that the U.S. government may allow only cigarettes with nonaddictive levels of nicotine and may also ban menthol, reports Bloomberg.
Altria Group fell 6.9 percent Tuesday, losing more than $11 billion in market value since Friday. British American Tobacco (BAT) dropped 8.3 percent in London Tuesday. Analysts estimate BAT derives up to a third of its earnings from menthol brands such as Newport.
In Asia, Japan Tobacco’s stock was near 2 percent lower. Philip Morris International shares, however, ended the day up over 2 percent and the company reported strong results on Tuesday; the company does not sell cigarettes in the U.S.
On Monday, The Wall Street Journal reported that President Joe Biden’s administration is considering new regulations requiring tobacco companies to reduce the nicotine levels in cigarettes sold in the U.S. to the point at which the products are no longer addictive.
Meanwhile, the administration faces a deadline over whether to ban menthol flavoring in traditional and electronic cigarettes.
While the established tobacco sellers took a stock market hit following the news, shares in 22nd Century Group jumped, according to The Motley Fool. The company genetically modifies tobacco plants to contain less nicotine, enabling it to offer low-nicotine cigarettes, alongside growing reduced-cannabinoid cannabis.
22nd Century has staked its existence on persuading the FDA to approve the company marketing and selling very low-nicotine traditional cigarettes. In a press note, 22nd Century said it was prepared to license its reduced nicotine content tobacco technology to every cigarette manufacturer.
April 21, 2021
22nd Century Excited About Nicotine Cuts

Photo: Tobacco Reporter archive
22nd Century Group said that it is fully prepared to partner with the U.S. Food and Drug Administration (FDA) to launch its VLN reduced nicotine content cigarette brand and license its reduced nicotine content tobacco technology to every cigarette manufacturer.
Recent media reports suggest that the Biden administration is actively considering moving forward the Advance Notice of Proposed Rulemaking (ANPRM) that will require tobacco manufacturers to reduce the amount of nicotine in all combustible cigarettes sold in the United States to be “minimally or nonaddictive.”
“A nicotine cap by the FDA has been in the works since the Obama administration,” said James A. Mish, CEO of 22nd Century Group, in a statement. “During that time, 22nd Century has consistently proven beyond any doubt with our VLN cigarettes that a cigarette that contains nicotine levels that the FDA has identified as ‘minimally or nonaddictive’ is technically feasible. Moreover, given the millions of Americans who smoke and will suffer and die from cigarette addiction, this mandate is necessary and appropriate.”
“As the only company with the ability to offer a combustible tobacco product that can meet the FDA’s mandate today, we look forward to helping with this critical public health initiative.
“Numerous independent research studies—largely funded by U.S. government agencies—have consistently confirmed the benefits of implementing a mandate on reduced nicotine content cigarettes for adult smokers.
“Once this rule is in place, we are fully prepared to provide the solution by making our VLN cigarettes available to adult smokers, and we remain willing to license our technology to every cigarette manufacturer in the industry to give them the opportunity to join us in our efforts to reduce the harm caused by smoking and to protect future generations from ever becoming addicted to cigarettes.”
We are fully prepared to provide the solution by making our VLN cigarettes available to adult smokers, and we remain willing to license our technology to every cigarette manufacturer.
James A. Mish, CEO, 22nd Century Group
The ANPRM that President Biden’s administration is considering moving forward was issued in March of 2018, and the comment period closed in June of 2018. The FDA will likely issue a notice of proposed rulemaking as the next step in the rulemaking process before a final rule is published.
Made from proprietary tobacco engineered to contain 95 percent less nicotine than conventional cigarette tobacco, 22nd Century’s RNC cigarettes are the only combustible tobacco products able to meet the nicotine levels proposed in the FDA’s ANPRM for a tobacco product standard to reduce the nicotine content of all combustible cigarettes, according to 22nd Century.
The company believes that it is in the final stages of the FDA’s application process to obtain a modified-risk tobacco product designation for its reduced nicotine content cigarettes, VLN King and VLN Menthol King. The designation will allow 22nd Century to communicate key features of the products, including the claim “95 percent less nicotine.”
April 20, 2021
Cannabis Consumers Types Identified
Picture: Riel Roussopoulos from Pixabay
The legal cannabis market is expected to increase more than 200 percent by 2025. According to research by Euromonitor International, the market will rise from $30 billion in 2020 to over $90 billion in 2025 as consumers increase their usage in diverse parts of their lives.
In a recent white paper, Breaking Stereotypes: Getting to Know the Cannabis Consumer, Euromonitor explores six adult cannabis consumer archetypes making up the emerging legal cannabis consumer base in 2021.
The report lists the six archetypes as:
The Seasoned Consumer: Long-time regular consumers who use cannabis to enhance their well-being. Twenty-four percent of these consumers suffer from high or extreme stress while 64 percent are strongly in favor of recreational legalization.
The Casual Social: Younger, newer consumers leveraging cannabinoid products as part of their wider lifestyles. Seventy-five percent of them take vitamins or health supplements at least monthly while 61 percent are strongly in favor of recreational legalization.
The Dabbler: Occasional cannabis users, familiar and comfortable with the substance but unlikely to see it as a key part of their lifestyle. Sixty-eight percent are in favor of its legalization for medical use while 45 percent believe legal cannabis should be at least as widely available as tobacco and alcohol.
The Canna-curious: A broad consumer group with an interest in adult-use cannabis consumption if legalized in their countries but with limited knowledge about cannabinoid products. Fifty-six percent are in favor of legalization for medical use while only 43 percent support adult-use liberalization.
The Unsparked: Consumers who are outwardly negative toward cannabis use but express enough uncertainty that many could be persuaded to engage further. Eighteen percent of these consumers believe that cannabis is unsafe while 8 percent see cannabis as something that enhances a user’s lifestyle.
The Naysayer: Strongly against adult use—only 8 percent are in favor of legalization—they are not an immediate target for producers and brand owners. Fifty-one percent state that they either have no or low levels of daily stress—the least stressed of all profiles.
As legalization expands and the normalization of cannabinoid use continues, organizations need to understand the motivations of the modern cannabis consumer and look beyond typical stereotypes.
Shane MacGuill, senior industry manager for Nicotine and Cannabis, Euromonitor
Seasoned cannabis consumers are established, long-standing and often traditionalist cannabis users “who will form the backbone of the legal industry” as it evolves, according to MacGuill. Companies need to understand and address the priorities of this group without alienating newer consumers whose product and brand priorities are often divergent, he notes.
“As legalization expands and the normalization of cannabinoid use continues, organizations need to understand the motivations of the modern cannabis consumer and look beyond typical stereotypes,” says MacGuill. “The legal cannabis industry must mirror the views and values of its consumers, given its history and the nature of its often countercultural evolution. Industry players can only achieve this with a nuanced segmentation and holistic understanding of participants in the sector.”
April 20, 2021
KT&G Helps Farmers Affected by Covid-19

Photo: KT&G
KT&G provided a leaf tobacco planting service in Jecheon, Chungcheongbuk-do, to help leaf tobacco farmers struggling due to manpower shortages in the aftermath of the Covid-19 pandemic.
Employees of KT&G’s Raw Materials Headquarters and Gimcheon Plant, who participated in the volunteer work, visited a leaf tobacco farm in Baegun-myeon, Jecheon-si, Chungcheongbuk-do, where they helped raise and plant seedlings in farmland of about 10,000 square meters.
“In addition to the declining population and aging population in rural areas, labor shortages have worsened due to the Covid-19 pandemic, and farmers are experiencing great difficulties,” said Shin Sang-ho, head of KT&G’s raw materials division, in a statement.
“KT&G has been working to alleviate the grievances of farmers by deploying leaf tobacco planting and harvesting volunteers every year and will continue to strive for win-win growth with farmers through various activities.”
In addition to the declining population and aging population in rural areas, labor shortages have worsened due to the Covid-19 pandemic.
Shin Sang-ho, head of KT&G’s raw materials division
KT&G is the only tobacco company operating in Korea to purchase domestic leaf tobacco and is making various efforts to protect farm households, such as prepaying 30 percent of the sales price of leaf tobacco for each farmer in cash. In addition, from 2013 to the present, the company has provided health checkups for farmers and scholarships for their children.
April 20, 2021
U.S. Mulls Low-Nicotine Mandate/Menthol Ban

Photo: Tobacco Reporter archive
The Biden administration is considering requiring tobacco companies to reduce nicotine levels in all cigarettes sold in the United States, reports The Wall Street Journal. The nicotine-reduction policy would lower the chemical in cigarettes to nonaddictive or minimally addictive levels and aim to push smokers to quit or switch to less harmful alternatives, the newspaper said.
Meanwhile, a deadline is nearing for the U.S. Food and Drug Administration to decide on whether to ban menthol cigarettes. The menthol ban would aim to curb smoking initiation among young people, many of whom start with menthol cigarettes.
According to the FDA, menthol cigarettes may be harder to quit than nonmenthol cigarettes, particularly among African American smokers. More than 19.5 million people reportedly smoke menthol cigarettes.
The tobacco industry has rejected the FDA’s findings on menthol, and both policies would take years to implement and would likely face legal challenges.
On April 12, 2013, health groups filed a petition calling on the FDA to ban menthol in cigarettes. Nearly seven years later, one of the co-signers, the African American Tobacco Control Leadership Council, filed a lawsuit alleging, among other things, the FDA unreasonably delayed issuing a final response to the citizen petition.
The FDA agreed to issue a final response to the petition by Jan. 29.
Then, a supplemental petition with additional research on the alleged harms of menthol cigarettes was submitted in January.
After the additional information was submitted, the parties agreed to extend the FDA’s deadline to issue a final response to April 29.
Recent news reports suggest the likelihood of a menthol ban in the U.S. is increasing.
Shares of tobacco giant Altria Group plunged on Monday following The Wall Street Journal report, according to CNN.
“A ban on menthol cigarettes or reduction in nicotine levels would fundamentally disrupt the U.S. cigarette market and would be credit negative for Altria as it would significantly accelerate cigarette volume decline,” said Maria Iarriccio, vice president and lead analyst for Altria at Moody’s Investor Service.
“Approximately 20 percent of Altria’s cigarette sales are menthol flavored. Also, a reduction of nicotine levels in cigarettes would be challenged by tobacco companies in courts and would take years to resolve.”
“Altria is focused on growing alternative products in the U.S., such as oral tobacco, e-vapor through its Juul investment and IQOS heated-tobacco,” Iarriccio added. “However, these alternative products contribute a small part to Altria’s existing business and will not offset the material decline in revenue should a ban be implemented.
April 20, 2021
Higher Revenues, Lower Volumes for PMI

Photo: PMI
Philip Morris International (PMI) reported net revenues of $7.59 billion in the first quarter of 2021, up from $7.15 billion in the comparable 2020 quarter. Operating income was $3.44 billion compared with $2.79 billion in the prior year period. Adjusted operating income amounted to $3.49 billion, up 25.2 percent from the 2020 quarter. PMI reported an adjusted operating income margin of 46 percent in the first quarter of 2021.
The company shipped 167.25 billion cigarettes and heated-tobacco units in the first quarter of 2021, down 3.7 percent from the volume shipped in the first quarter of 2021. Heated-tobacco unit shipments increased 29.9 percent to 21.73 billion from quarter to quarter, while cigarette shipments declined 7.3 percent to 145.51 billion between the reporting periods.

We are pleased to have delivered a very strong start to the year, with top- and bottom-line results coming in well ahead of our expectations.
Andre Calantzopoulos, CEO, PMI
“We are pleased to have delivered a very strong start to the year, with top- and bottom-line results coming in well ahead of our expectations for the first quarter despite the ongoing challenges of the pandemic,” said PMI CEO Andre Calantzopoulos in a statement.
“This performance was driven by the continued strength of IQOS, in particular, reflecting excellent user, volume and market share momentum as well as further progress with manufacturing and operating cost efficiencies. Our results also benefited from the timing of specific factors, notably associated with shipments in certain markets and the phasing of commercial investments, which are expected to partially reverse in the second quarter.”
“While the speed and shape of the global recovery from the pandemic remains uncertain, we are raising our full-year outlook, on an underlying basis, to reflect the strong results and positive momentum of the first quarter. Our guidance now represents organic adjusted diluted EPS growth of 11 percent to 13 percent, reflecting net revenue growth of 5 percent to 7 percent on the same basis.”
April 20, 2021
‘Asia Blocking Solutions to Tobacco Crisis’

Photo: Paop | Dreamstime.com
Knowledge-Action-Change (KAC), a company dedicated to the promotion of tobacco harm reduction (THR) to improve health, has published Tobacco Harm Reduction: A Burning Issue for Asia.
THR allows people to quit smoking or using oral smokeless tobacco by switching to safer nicotine products. Compared to smoking or smokeless tobacco, vaping devices, heated-tobacco products (HTP) and pasteurized oral products enable people to continue using nicotine at a fraction of the risk, according to KAC. The new briefing shows that Asia has been at the forefront of several key THR successes. The first vaping device was developed by a Chinese scientist. In Japan, cigarette sales have slumped by 32 percent since the introduction of HTP.
Yet many governments in Asia have limited or prohibited people’s access to safer nicotine products while deadly cigarettes and oral smokeless tobacco remain freely on sale. Tobacco Harm Reduction: A Burning Issue for Asia explores the obstacles to THR in the region, including the role of significant state involvement or ownership of tobacco companies, the misinformation campaign against safer nicotine products from apparently credible international agencies and the influence of U.S.-led philanthropic funding on domestic policymaking around tobacco and nicotine.

The report reveals the huge disparity between the number of smokers in Asia at 743 million and the number who have switched to vaping. Research carried out for the report estimates there are 19 million people using vaping products in Asia in 2021—meaning there are 39 smokers for every vaper in the region. They authors argue tobacco harm reduction must be scaled up—and fast.

Tobacco harm reduction is truly a burning issue for Asia. Many of Asia’s millions of smoking-related deaths are preventable—if only consumers had access to safer nicotine products.
Harry Shapiro, author, Tobacco Harm Reduction: A Burning Issue for Asia
“Tobacco harm reduction is truly a burning issue for Asia. Many of Asia’s millions of smoking-related deaths are preventable—if only consumers had access to safer nicotine products. Unfortunately, the failing WHO FCTC and a barrage of misinformation and anti-THR propaganda is getting in the way of public health progress in the region,” said report author Harry Shapiro ahead of the launch.
Tobacco Harm Reduction: A Burning Issue for Asia is part of KAC’s Global State of Tobacco Harm Reduction, a project established to map the development of tobacco harm reduction and the use, availability and regulatory responses to safer nicotine products around the world. The project was produced with the help of a grant from the Foundation for a Smoke-Free World.
April 19, 2021
Vape Group to Protest German Tax Plans

Photo: Nikolaus Bader from Pixabay
Germany’s planned e-cigarette tax is a health policy disaster that will destroy jobs and boost black market sales without generating significant additional revenues, according to the country’s e-cigarette trade association VdeH.
Under the plans, e-liquids will attract a tax of €4 per 10 mL bottle from July 1, 2022. On Jan. 1, 2024, the tax will increase to €8 plus VAT, i.e., €9.52 per 10 mL bottle. Based on an average sales price of about €5 per bottle, this amounts to a tripling of the retail price, says VdeH.
On April 21, the VdeH plans to protest the plans by projecting statements from scientists and consumers supporting its position on a 20 x 35 meter “hydro shield” at the Reichstag waterfront in Berlin.
“The planned excessive taxation means that the 95 percent less harmful e-cigarette will soon be more expensive than conventional cigarettes,” says Michal Dobrajc, managing chairman of the VdeH, in a press note. “With 11 million smokers still in Germany, the e-cigarette is the greatest health policy opportunity we have—we must use it. The planned tax would have exactly the opposite effect.”
The tax plans, which fail to consider the expected market slump of 50 percent when calculating tax revenue, would take the level of vapor product taxation in Germany to five times the EU average, according to the VdeH.
The law would not only shift consumption back to more harmful tobacco cigarettes but also sacrifice the entire industry to the black market, the trade group cautions.
April 19, 2021
New Tobacco-Based Vaccine Candidate

Photo: torstensimon from Pixabay
Akdeniz University in Turkey has developed an anti-Covid-19 drug and vaccine candidate using a protein produced by the tobacco plant Nicotiana Benthamiana, reports Hurriyet Daily News.
The product is based on an angiotensin-converting enzyme 2 (ACE2), an enzyme attached to the human body’s cell membranes in the lungs, arteries, heart, kidney and intestines. The Covid-19 virus blocks ACE2, which leads to significant health problems.
“With the transient plant expression system, we have achieved a high rate of production of this enzyme,” said Tarlan Mammedov, a member of the university’s faculty of agriculture and a member of the vaccine science board of the Biotechnology Institute of the Presidency of the Turkish Institutes of Health.
The treatment can be applied as an injection and as a spray, according to Mammedov.
Akdeniz University tested its vaccine candidates on mice with live viruses and found a high level of inhibition of the live virus from entering the cell.
It is now seeking funding to conduct clinical trials with humans. Mammedov said the drug could be released within four months.
Akdeniz University is not the first institution to use tobacco for vaccine development. Other tobacco-based Covid-19 vaccine candidates are being developed by British American Tobacco, Medicago and Chulalongkorn University in Bangkok.
April 19, 2021