Category: News This Week

IOTO Expands Into Hemp Sheets

IOTO will leverage its experience in tobacco to serve the hemp industry.
(Photo courtesy of IOTO)
IOTO International, a U.S. and Brazil-based manufacturer of homogenized wrapper, cut filler and binder, has expanded its Yerba Mate, Chamomile and other herbal homogenized sheet offerings to include premium reconstituted hemp sheet.
Utilizing qualified and tested hemp flower, leaf or stem supplied by customers (or directly sourced locally by IOTO), the company is now able to offer customized manufacture of hemp sheet to the specific herbal content requirements of its clients.
“Demand for hemp smoking wrappers in the USA has increased exponentially over the last two years as brand developers have brought novel hemp cigarettes, cigars, hemp wrappers and hemp cones to the market,” said Helder Tullio, director of operations at IOTO, in a statement.
“Unfortunately, the majority of the hemp wrap available today is generic and not crafted to meet the specific smoking qualities required by brand owners.
At IOTO, we are set up to run both small-scale and high-volume production, and we are able to meet the specific formulation needs of the client.
We can help make smaller brands more viable and give them real points of differentiation.
Helder Tullio, director of operations, IOTO
“Given our scaled manufacturing approach, we can work with smaller initial production runs and ultimately grow with brand owners as sales volumes expand. In effect, we can help make smaller brands more viable and give them real points of differentiation from the generic hemp wrapper offerings that are in the market today.
“The IOTO hemp wrapper is a highly durable hemp sheet, and we believe our manufacturing process gives us a distinct edge over competitors and delivers a superior quality hemp sheet for clients. In addition, IOTO’s capabilities in flavor development also help our customers meet their targeted taste profile requirements when making flavored hemp sheet.”
April 7, 2021
Menthol Market to Grow Despite Restrictions

Photo: simisi1 from Pixabay
Demand for menthol is projected to grow even as authorities restrict its use in cigarettes, according to a new report published by Transparency Market Research.
The authors of the study expect the market to reach $1.2 billion by 2030, partly because of the continuing popularity of menthol cigarettes.
Menthol is a crystalline organic compound that can be synthesized or derived naturally from plants such as peppermint, mint oil and corn mint. Menthol is utilized in an extensive variety of confectionary items, such as candies, cough drops and chewing gums, because of its high nutritional and medicinal value.
It is also utilized in pharmaceuticals, such as in inhalation items and ointments. Such extensive use of the product is estimated to foster growth of the global menthol market in the years to come. Menthol is traditionally extracted by collecting and processing mint leaves. Changes in climatic conditions, on the other hand, appear to affect the total supply of menthol and cause instability in the global menthol market in the near future.
Despite the U.S. Food and Drug Administration’s continuing scrutiny of the health quotient associated with menthol, these products have stayed free from significant regulatory bans across the globe, resulting in steady development in the global menthol market. This trend is expected to continue throughout the assessment timeframe. Another major factor anticipated to augment market growth is high demand for menthol from the food and beverage sector. There is a growing demand for sweet-tasting flavorings, especially among the young adults around the world, which is likely to foster growth of the global menthol market in the years to come.
Menthol cigarettes have a sizable market share in the combustible cigarette market. Furthermore, the menthol market is expected to expand at a steady rate as a growing number of new smokers choose menthol cigarettes over traditional cigarettes. While sales of menthol cigarettes continue to rise year after year, increasing public awareness about the adverse effects of tobacco products and tobacco is predicted to stifle demand for menthol cigarettes later during the forecast timeframe.
In May 2020, the EU banned sales of menthol cigarettes. Critics have accused the tobacco industry of sidestepping the ban with innovative products. While cigarette manufacturers have developed alternatives for former EU menthol smokers, they insist their new products comply with the law.
According to a recent article in The New York Times, the likelihood of a ban on menthol cigarettes in the United States is increasing as the impact of menthol cigarettes on Black Americans becomes clearer.
April 7, 2021
Organigram buys The Edibles & Infusions Corp

Photo: Erin Stone from Pixabay
Organigram Holdings has acquired The Edibles & Infusions Corp. (EIC) in a CAD35 million ($27.88 million) stock deal, reports Reuters.
EIC specializes in pot edibles, like gummy bears, brownies and drinks, and have been the biggest beneficiaries of increased demand for cannabis products during coronavirus lockdowns.

Edible products remain an important product category to Organigram, and EIC represents an ideal partner with which to expand our market presence in this category as well as other derivative cannabis categories.
Greg Engel, CEO, Organigram
“Edible products remain an important product category to Organigram, and EIC represents an ideal partner with which to expand our market presence in this category as well as other derivative cannabis categories,” Organigram Chief Executive Greg Engel said.
In March, British American Tobacco announced it would buy a nearly 20 percent stake in Organigram for about £126 million ($174.30 million) as it looks to diversify beyond its main tobacco business.
Organigram said it currently expects first sales of EIC-manufactured soft chews in the fourth quarter of fiscal 2021.
The Toronto Stock Exchange has approved the EIC deal, according to Organigram.
April 7, 2021
Researchers Urge Refresh of Warnings

Image: ITCPEP
While Canada’s plain tobacco packaging laws substantially reduced pack appeal, they have not made smokers take greater notice of the pictorial health warnings, according to a new report published by the International Tobacco Control Policy Evaluation Project (ITCPEP).
Canada introduced plain packaging in 2019 as part of a comprehensive suite of policies to help reduce tobacco use to 5 percent by 2035.
The regulations apply to packaging for all tobacco products, including manufactured cigarettes, roll-your-own products, cigars, pipe tobacco, smokeless tobacco and heated-tobacco products.
Vapor products are not covered under these regulations because they are not classified as tobacco products under the Canada’s Tobacco and Vaping Products Act.
In 2001, Canada became the first country to require graphic health warnings on cigarette packs. The images are periodically refreshed. The most recent switch of pictures took place eight years ago.
The ITCPEP survey showed that the share of smokers who did not like the look of their cigarette pack after the implementation of plain packaging in Canada increased from 29 percent in 2018 to 45 percent in 2020.
However, there was no significant change in the percentage of smokers who said they usually notice warning labels first when looking at a cigarette pack (35 percent in 2018 versus 36 percent in 2020).
Based on their findings, the report’s authors recommend refreshing Canada’s eight-year-old pictorial health warnings to address wear-out of health warning salience and effectiveness
As of July 2020, plain packaging has been fully implemented in 14 countries: Australia (2012); France and the United Kingdom (2017); New Zealand, Norway and Ireland (2018); Uruguay and Thailand (2019); Saudi Arabia, Turkey, Israel and Slovenia (January 2020); Canada (February 2020); and Singapore (July 2020).
By January 2022, Belgium, Hungary and the Netherlands will have fully implemented plain packaging.
April 6, 2021
Bangladesh: Smokeless Tobacco Avoiding Tax

Photo: Thouhid Pie from Pixabay
Less than half of smokeless tobacco (SLT) factories in Bangladesh pay taxes, reports the Dhaka Tribune, citing a recent study by the Campaign for Tobacco-Free Kids (CTFK). Of the 483 factories in the country, only 218 are paying taxes.
Some of these manufacturers do not have valid trade licenses: Of the 88 manufacturers surveyed over 29 districts of the country’s eight administrative divisions, who are out of the tax net, 33 percent did not have valid licenses.
The study also showed that 91 percent of manufacturers produce smokeless tobacco products manually and that they are primarily manufactured in small, unmarked factories or houses.
“SLT use should be reined in for the sake of revenues and public health,” said Zakia Sultana, National Board of Revenue member. “Reducing SLT use would also reduce health sector expenditure.”
The study identified the informal nature of smokeless tobacco production as the main impediment in ensuring tax compliance in this sector.
April 6, 2021
RELX: Widely Used Coolant Not Toxic

Photo: Tobacco Reporter archive
The WS-23 cooling agent has limited impact on the experiment animals at the tested dose, according to a study performed by RLX Technology and published in the Journal of Applied Toxicology.
The RLX Technology study showed that there were no deaths in any of WS-23 treated groups in the acute and subacute inhalation studies, with no remarkable changes occurred in body weight, organ weight, hematology and serum biochemistry and no toxic effects in the histopathologic analysis.
It was the first study published on the Science Citation Index (SCI) indexed journal conducted by the Chinese e-cigarette industry.
WS-23 is a well-known artificial synthesis cooling agent widely used in foods, medicines and tobaccos. As a common cooling agent in e-cigarette liquids, WS-23 has led to concerns about the inhalation toxicity with the proliferation of e-cigarettes in recent years. The study shows that at the tested dose level, inhalation of WS-23 will not bring toxic side effects to test animals.
“Product safety has always been RLX’s top concern, and it is also the direction and commitment in our research and development,” said Xingtao Jiang, head of RELX Lab, which is part of RLX Technology, in a statement. Before the study was published, RELX Lab conducted vitro tests to prove the aerosol-containing WS-23 is safe to use in the products.
April 6, 2021
Greek Tobacco Workers Get Wage Increase

Photo: Tobacco Reporter archive
The Federation of Greek Tobacco Industry Employees and the Hellenic Federation of Enterprises (SEV) have agreed to a 1 percent wage increase as part of a two-year collective work agreement, reports The National Herald.
The agreement covers all tobacco businesses in Greece and provides for a working group on updating skills of current employees.
“Our aim is the productive operation of businesses in every sector, the maintenance and boosting of productive and viable job positions, and the guarantee of labor peace and prosperity of workers,” said Efthymios Vidalis, president of SEV’s executive committee.
The tobacco sector in Greece employs more than 2,500 people. Its production grew by 11.5 percent in 2019–2020, according to the National Statistical Service.
April 5, 2021
Zimbabwe: New System to Pay Farmers Quickly

Photo: Taco Tuinstra
Zimbabwe’s 2021 tobacco marketing season will open on Wednesday with a new payment system that will pay farmers within minutes rather than days after selling their product, reports The Sunday Mail.
“There is no need for tobacco growers to go even one day without being paid,” said Vangelis Haritatos, deputy minister of lands, agriculture, fisheries, water and rural resettlement. “The systems are so efficient that they have guaranteed us that within 10 minutes that some form of payment will be arranged. So the farmers come in with the produce, they deliver and almost immediately the account is credited; we don’t see any challenges, the money is coming in.”
In the past, payment for tobacco deliveries could take days to be processed.
Haritatos said the ministry would not tolerate side marketing.
“We keep encouraging and telling our farmers that farming is indeed a business,” he said. “Through the TIMB [Tobacco Industry and Marketing Board], the systems are all integrated; they all talk to each other. So if [I] have been contracted to TIMB and I try and sell my product to another floor or another contractor, basically I will be blocked because the systems talk to each other.”
Last week, the Reserve Bank of Zimbabwe said it had put in place effective payment procedures to ensure merchants and farmers can retain or be paid 60 percent of their net revenue in foreign currency and 40 percent in local currency.
The TIMB has adopted a stricter and stringent regime of Covid-19 health protocols that restrict access to the floors to one person per delivery.
Under the new rules, flea markets and hawking will not be permitted around the premises of tobacco auction floors.
April 5, 2021
Egypt Postpones License Auction

Photo: Tobacco Reporter archive
Egypt has postponed a tender for a license to manufacture cigarettes and vapor products, reports Reuters, citing industry sources.
An auction for the license, which would have ended a decades-old monopoly by the state-controlled Eastern Co., was due to be held on April 6.
“What we understand … is that the postponement is for an indefinite period … Certainly, the conditions for the auction will be changed if it is held again,” one source told Reuters.
Earlier, several bidders had asked the Federation of Egyptian Industries to change the conditions of the license.
According to the companies, the conditions protect Eastern Co.’s market share by preventing the new company from producing cigarettes at the same price point as the monopoly’s mass-market Cleopatra brand, which accounts for 98 percent of Eastern Co.’s revenues.
On March 21, the tobacco manufacturer announced that the IDA has invited companies to the tobacco industry through tendering a new cigarette production license.
The monopoly reported a 14 percent year-on-year increase in its net profit in the second half of 2020, recording EGP2.54 billion ($161.52 million).
Eastern Co.’s product portfolio includes cigarettes, cigars, pipe tobacco and molasses tobacco as well as cigarette filter rods and homogenized tobacco.
April 5, 2021
Founders Invest in Charlie’s Holdings

Photo: Tobacco Reporter archive
Charlie’s Holdings has raised $3 million through the private sale of 351,669,883 shares of common stock to the company’s founders, Brandon Stump, CEO, and Ryan Stump, chief operating officer, the company announced. Charlie’s Holdings intends to use the proceeds to drive growth, facilitate product launches, increase working capital, retire outstanding debt and for other general corporate purposes.
“The extensive process required to compile and submit a comprehensive premarket tobacco product application (PMTA) to the FDA will ultimately prove a huge differentiating factor for Charlie’s, but it was also very expensive,” said Jeff Fox, a member of Charlie’s board of directors.
“Charlie’s invested nearly $5 million for its initial PMTA submission, and the company was in need of additional capital. After lengthy negotiations with numerous other potential investors did not produce acceptable terms, we are pleased that our founders, Brandon and Ryan Stump, chose to personally fund this $3 million common stock only investment.”
After lengthy negotiations with numerous other potential investors did not produce acceptable terms, we are pleased that our founders, Brandon and Ryan Stump, chose to personally fund this $3 million common stock only investment.
Jeff Fox, member of Charlie’s board of directors
Chief Financial Officer David Allen said the proceeds from the private placement will strengthen the company’s balance sheet, accelerate European growth, allow for expansion into the Middle East and facilitate the company reaching several important near-term milestones, including the FDA’s anticipated announcement of Charlie’s successful PMTA.
“Such an accomplishment will allow Charlie’s to benefit tremendously as one of only a select group of companies operating responsibly in the premium e-liquid product space,” said Allen. “Combined with our international growth, a domestic PMTA approval will dramatically increase Charlie’s sales, profits and market share. We expect 2021 will be a very exciting year for our shareholders.”
April 5, 2021