Category: News This Week

Cigarette Factories Raided in Benelux

Photo: Europol
Authorities seized 14 million cigarettes and 186 tons of cut tobacco during raids carried out in Belgium and the Netherlands this month, reports Europol. Seven workers were arrested at the illegal factory in the Netherlands. With a production area of 6,000 square meters, the illegal factory in Belgium is one of the largest dismantled to date.
This sweep followed an investigation led by Belgian customs with the support of the Polish Police Central Bureau of Investigation, the Dutch Fiscal Information and Investigation and Europol.
The confiscated cigarettes were likely destined for the U.K., which levies high rates of taxation on tobacco products.
These seizures follow those of a separate operation in Spain. On Jan. 4, the Spanish National Police and Spanish Tax Agency targeted a tobacco smuggling network operating in Cordoba and Seville. This operation was also carried with the support with the Polish Central Bureau of Investigation, the Polish National Revenue Agency and Europol.
The Spanish operation resulted in the arrest of 12 individuals, including Spanish, Ukrainian and Belarussian nationals, and the seizure of 910,000 cigarettes, 4.2 tons of filters and 10.3 tons of cut tobacco, along with various pieces of machinery and vehicles. The total value of the seized goods exceeds €1 million.
Europol’s Analysis Project Smoke within the European Economic and Financial Crime Centre supported both these investigations. This team is dedicated to investigating the unlawful manufacturing and smuggling of excise goods.
Analysis Project Smoke facilitated the international cooperation between the involved countries by providing a secure platform of communication, running cross-checks against Europol’s databases and providing analytical and operational expertise to tailor the respective investigation strategies.
Belgium customs seized 409.9 million illicit cigarettes in 2020, up 108 percent from 2019. In addition, customs seized 49 tons of hookah tobacco (up from 4.1 tons in 2019) and 73 tons of other tobacco products.
In total for the year, five illegal cigarette factories were dismantled in Belgium, along with four illegal shisha tobacco factories, one tobacco cutting site, two cigarette packaging sites and six storage sites. In all, 32 people directly connected to illicit tobacco product trade on Belgian soil were arrested.
This illicit traffic in Belgium is “a problem that concerns the entire European Union,” according to Florence Angelici, spokeswoman of the FPS Finance.
January 29, 2021
Rush Nicotine Pouch Hits U.S. Market

Photo: Crown Distributing
Rush non-tobacco oral nicotine pouches are now available in the United States through Crown Distributing, Global Tobacco and America Juice Co.
Manufactured under license through Alternative Nicotine Technologies, Rush is available in wintergreen, mint, citrus and cinnamon flavors. Consumers can pick between nicotine levels of 3 mg and 7 mg.
Mike Walters, vice president of sales at Crown Distribution, has high expectations for the new product. “Our initial consumer feedback tells us the Rush tobacco-free white nicotine pouches rate high on soft mouth feel, flavor impact and overall nicotine satisfaction when compared to other brands currently on the market,” he said in a statement.
Unlike other pouch brands that claim to be tobacco-free, Rush does not rely on tobacco-nicotine extracts or flavors, according to Crown Distribution. “We deliver on our promise that all of our ingredients are certifiable as non-tobacco,” says Walters. “This makes the Rush nicotine pouch the first true ‘tobacco-free’ nationwide brand roll-out in the modern oral nicotine pouch category.”
January 29, 2021
22nd Century Moves Headquarters

Photo: Vincent Groeneveld from Pixabay
22nd Century Group is moving its corporate headquarters to the Larkinville District in Buffalo, New York, USA.
“We have experienced tremendous positive change in our organization over the past year and this relocation will help us improve on efficiency, collaboration, and our ability to attract and retain top talent,” said James A. Mish, chief executive officer of 22nd Century Group, in a statement. “We have deep roots in Buffalo, and we are very excited to be moving to the up-and-coming Larkinville District, Buffalo’s oldest manufacturing district, to join other organizations that are revitalizing the city’s tech and business community.”
22nd Century Group’s new Buffalo office space is in a state-of-the-art, restored manufacturing facility located at 500 Seneca Street, joining other multinational technology and professional services companies. The new headquarters will accommodate all the company’s staff from its current office location in nearby Williamsville and has significant room for expansion.
The company believes that authorization of its MRTP application by the U.S. Food and Drug Administration, along with its expected growth in the hemp/cannabis space and a soon-to-be-announced third franchise, will require an expansion of resources and space. 22nd Century Group will move to its new headquarters in March 2021.
January 28, 2021
Altria Full-Year Revenues up

Photo: Altria Group
Altria Group reported net revenues of $26.15 billion in fiscal 2020, up 4.2 percent from 2019. The company attributes the increase to higher net revenues in the smokable products and oral tobacco products segments, partially offset by lower net revenues in the “all-other” category and the wine segment. Revenues net of excise taxes increased 5.3 percent to $20.84 billion.
“Altria delivered outstanding results in 2020 and managed through the challenges presented by the Covid-19 pandemic,” said Altria CEO Billy Gifford. “Our tobacco businesses were resilient, and we made steady progress toward our 10-year vision to responsibly transition adult smokers to a noncombustible future.”
“Our plans for the year ahead include accelerating investments in support of our 10-year vision, which we expect to fund through the continued financial strength of our tobacco businesses. We expect to deliver 2021 full-year adjusted diluted EPS [earnings per share] in a range of $4.49 to $4.62, representing a growth rate of 3 percent to 6 percent from an adjusted diluted EPS base of $4.36 in 2020.”
In a press note, Altria Group highlighted notable developments in key business segments over the past fiscal year.
In December, the U.S. Food and Drug Administration authorized the IQOS 3 device for sale in the U.S. The new device has a longer battery life and a faster re-charging time compared to the currently authorized 2.4 version. Altria subsidiary Philip Morris USA expects to begin selling the new device shortly and that it will be made available across all existing retail channels in Atlanta, Charlotte and Richmond.
In the fourth quarter, Altria’s Helix subsidiary expanded the distribution of On! Nicotine pouches by an additional 22,000 stores. On! is now available in approximately 78,000 stores as of the end of the fourth quarter, an increase of nearly 40 percent from the end of the third quarter and more than five times the store count from the end of 2019.
Helix reached annualized manufacturing capacity for On! of 50 million cans in the fourth quarter. Helix expects unconstrained On! manufacturing capacity for the U.S. market by mid-year 2021.
In November, Altria exercised its right to convert its nonvoting shares in Juul to voting shares. The company said it does not currently intend to exercise its additional governance rights obtained upon share conversion, including the right to elect directors to Juul’s board, or to vote its Juul shares other than as a passive investor, pending the outcome of the U.S. Federal Trade Commission litigation.
Altria said its tobacco businesses have not experienced any material adverse effects associated with governmental actions to restrict consumer movement or business operations amid the Covid-19 pandemic. Most retail stores in which their products are sold have been deemed to be essential businesses by authorities and remain open.
January 28, 2021
Liquid Market To Reach $3.3 Billion This Decade

Photo: Vaperesso
The global e-liquid market could reach $3.3 billion before the end of the decade, expanding at a compound annual growth rate of 13.4 percent from 2021 to 2027, according to a new study published by Grand View Research.
“The advent of e-cigarette products such as squonk mods and pod systems has increased its popularity and adoption in recent years. The rising demand for these products globally is expected to drive the market over the forecast period,” the researchers wrote. “In addition, the general presumption that these products can reduce the risk of lung disorders is fueling the market.”
In terms of flavor, the menthol segment is anticipated to register the highest growth rate over the forecast period owing to increasing adoption among young people, especially in students, coupled with its availability at affordable prices, according to the report.
“In terms of type, the bottled segment is expected to register growth at a significant pace from 2021 to 2027. This can be attributed to the fact that bottles allow users to make their own e-juice by adding two or more e-liquids,” the report states. “In terms of distribution channel, the online segment is anticipated to register a significant growth rate over the forecast period as it provides customers with a wide variety of e-liquids.”
Market players are focusing on mergers and acquisitions, collaborations, and partnerships in order to expand their distribution networks and build an international presence for their brands, according to the report. “For instance, in January 2018, Nicopure, a manufacturer of e-cigarette and e-liquid, announced a partnership with Vapоr Ltd., a distributor of e-cigarette and e-liquid in Bulgaria,” the authors wrote. “Nicopure appointed Vapоr Ltd. as one of its distributors in Bulgaria. The partnership allowed the former to expand its brand presence in Bulgaria.”
What’s more, key players are increasingly investing in the marketing and distribution of their products owing to rising competition in the market. For instance, in July 2019, Turning Point Brands invested $3 million in the Canadian distribution firm ReCreation Marketing, according to the report. Through the ReCreation Marketing platform, the company launched RipTide, an e-liquid vape technology, and a variety of Nu-X products in Canada.
January 28, 2021
Tobacconists Donate $50,000 For Advocacy

Photo: 13 Motortion – Dreamstime.com
The Tobacconist Association of America (TAA) will donate $50,000 to the Premium Cigar Association (PCA) to aid in the industry’s growing work in local and state legislation impacting the premium cigar and pipe industries.
“The PCA would like to thank the TAA for this outstanding show of support as our industry is facing some of the most egregious tax grabs and potential smoking bans in recent history,” said PCA Executive Director Scott Pearce. “The PCA is hard at work in over two dozen states already fighting tax increases that, at the best of times, are harmful to our small business retailers. Especially during the pandemic that could potentially put our members out of business.”
PCA President John Anderson echoed Pearce’s gratitude, urging retailers everywhere to engage in the fight. “We are at our best when we are all participating in this fight, and we need all of our retailer voices to join in to ensure we will not be steamrolled by misguided public policy,” Anderson said. “TAA’s support will help ensure that we can continue to be active and put all of our resources towards defending our retailers across the country.”
“The TAA is happy that it can support the brick-and-mortar community in these most challenging times,” said Joe Arundel, TAA president. “The TAA recognizes and appreciates the outreach that PCA gives to our retail members in their respective communities across this country. We are confident that PCA can effectively help defend our stores and businesses in the coming months.”
Founded in 1933, the PCA represents and assists retailers, manufacturers and suppliers of premium tobacco products. Established in 1968, the TAA supports its members with tools and relationship building opportunities to optimize their success in the brick-and -mortar business.

January 27, 2021
Tanzania Eyes New Tobacco Markets

Photo: Taco Tuinstra
The government of Tanzania wants to extend its tobacco market to the Middle East, Northern Africa and eastern Asia, reports All Africa.
The tobacco industry is the largest source of foreign currency in the country, and the minister for agriculture, Adolf Mkenda, has concerns about the current foreign buyers trying to monopolize the crop.
Mkenda stated that the government wanted to export its finest tobacco to China, Saudi Arabia, Indonesia, Algeria, Egypt and Sudan, among other countries. “The current system is not good,” he said. “Some buyers are skipping locally produced tobacco or demand to buy at a low price … they push farmers to sell their produce to Zambia. For no reason traders go to Zambia to buy the same crop they rejected in Tanzania and at a high price … this is unacceptable.”
Deputy Minister for Agriculture Hussein Bashe said global demand for tobacco declined by 5 percent. He noted, however, that tobacco production in Tanzania is expected to rise to 67,000 metric tons in 2020-2021 from 42,000 metric tons in 2019-2020. “This is due to the emergence of local buyers,” he said.
Of the cigarettes produced in Tanzania, 65 percent are exported to foreign countries.

January 27, 2021
PMTA Included in White House Rules Freeze

Photo: David Mark from Pixabay
The new U.S. administration has frozen all new and pending rules introduced in the last days of the Trump administration. Included in the freeze are the new finalized rules for premarket tobacco product applications (PMTA) and substantial equivalence (SE) that were announced on Jan. 19, the last full day of the Trump administration.
The Food and Drug Administration’s CBD enforcement policy draft guidance, which had been under review at White House Office of Management and Budget (OMB) since July, was also withdrawn.
Stakeholders and lawmakers have been anticipating the guidance for two years, since the 2018 Farm Bill gave the FDA authority over hemp-derived CBD. Representatives from the U.S. Hemp Roundtable and the National Industrial Hemp Council, both of which met with OMB to discuss the draft guide in late July, say the lack of regulatory clarity from FDA has led to uncertainty in the hemp and CBD industry.
A memo, issued by White House Chief of Staff Ronald Klain, calls on the heads of executive departments and agencies to “propose or issue no rule in any manner—including by sending a rule to the Office of the Federal Register [OFR]—until a department or agency head appointed or designated by the president after noon on January 20, 2021, reviews and approves the rule.” Previous administrations, including those of Trump and Barack Obama, issued similar memos to stop last-minute actions by the outgoing administration.
What this means for the nicotine business is unclear. It does not change the rules concerning the Sept. 9 deadline to submit a PMTA to be eligible to stay on the market for year. Because the rule was not formally published in the Federal Register by the U.S. FDA before the end of Trump’s presidency, the Biden administration could move forward with the rule as is, make changes to the rule or scrap the rules entirely.
An note on the Federal Register website reads,” The Food and Drug Administration withdrew this document while it was on public inspection. It will remain on public inspection until the close of business on January 27, 2021. A copy of the withdrawal request is available at the Office of the Federal Register.”
The White House memo also explains that it does not strictly apply to “rules” but also to “any substantive action by an agency (normally published in the Federal Register) that promulgates or is expected to lead to the promulgation of a final rule or regulation, including notices of inquiry, advance notices of proposed rulemaking, and any agency statement of general applicability and future effect that sets for a policy on a statutory, regulatory, or technical issue or an interpretation of a statutory or regulatory issue.”
January 27, 2021
Jose Maria Costa Joins Newco

Jose Maria Costa
Jose Maria Costa will join Newco’s global team as an advisor to management effective Feb. 1, 2021.
Over the course of his 28-year career, Costa held various managerial positions at Pyxus International and its predecessor companies. His most recent roles include executive vice president of value-added agricultural products in Lilongwe, Malawi; executive vice president of global operations and supply chain in Raleigh, North Carolina, USA; and regional director for Europe and the U.K.
In his new role, Costa will focus on growing Newco’s business through diversification and sustainability.
January 27, 2021
Higher-Nicotine Juuls May Facilitate Switching

Photo: Juul Labs
The nicotine delivery of Juul products available in the United States and Canada (59 mg/mL or 5 percent nicotine by weight) more closely resembles the nicotine delivery and experience of cigarette smoking than Juul products available in the European Union, which contain 18 mg/mL and/or 9 mg/mL of nicotine, according to a new study from Juul Labs published in Nicotine & Tobacco Research.
Researchers posited that heavier and more dependent smokers in particular may require the greater nicotine delivery of the higher nicotine concentration Juul pods (59 mg/mL) in order to successfully transition away from cigarettes.
The new study, which consisted of 24 adult smokers, assessed the nicotine delivery and subjective effects of combustible cigarettes compared to the Juul system with three nicotine concentrations: 59 mg/mL (U.S. and Canada), 18 mg/mL (U.K. and Canada) and 9 mg/mL (U.K.).
At each of five study visits, participants used one of four Juul products or smoked their usual brand of cigarette during controlled (10 puffs) and ad libitum use (5 minutes) sessions. Blood samples were collected, and levels of nicotine in the bloodstream were measured for each study product. Subjective effects, including relief of craving for cigarettes and withdrawal symptoms, were assessed 30 minutes after participants used each product.

The higher concentration (59 mg/mL) Juul product delivered significantly greater levels of nicotine and significantly reduced craving and withdrawal compared to the Juul with 18 mg/mL and 9 mg/mL nicotine concentrations. Researchers concluded that the lower nicotine delivery and craving relief from the 18 mg/mL and 9 mg/mL Juul pods available in the EU may limit the product’s ability to provide a satisfying alternative to cigarette smoking—particularly for more dependent adult smokers living in that region.
“When considering laws and regulations governing nicotine concentration in ENDS, policymakers should bear in mind that the availability of a variety of alternative nicotine products may facilitate even more smokers transitioning away from cigarettes,” said Mark Rubinstein, vice president of global scientific affairs at Juul Labs.
January 26, 2021