Australian cigarettes are 12.5 percent more expensive following a price hike on Sept. 1.
Successive tax hikes from April 2010 have made Australian cigarettes among the most expensive in the world. Following the most recent increase, a 25-stick pack of Marlboro Gold cigarettes now costs AUD48.50 ($35.63) while the average 20-pack costs around AUD35.
That means a pack-a-day smoker will spend AUD12,500 over the course of a year.
Australian tobacco taxes generate around AUS17 billion per year in tax revenue. According to Cancer Council Victoria, they also contribute to declining smoking rates.
Smoking among Australians aged 14 and over declined from 17.87 percent of the population to 13.3 percent between April 2020 and April 2017, according to the charity.
The Covid-19 crisis could drive smoking lower still. Health Minister Greg Hunt revealed that four times as many smokers have tried to quit during the pandemic amid concerns that smokers will be hit harder by the virus should they contract it.
The cigarette industry is likely to suffer disruption in 2020 with high single-digit volume declines expected and intensifying commoditization up to 2024, according to a new report.
Last year was a relatively strong year for the business. Volume decline, excluding China, of 1.9 percent was the best performance since 2016 and made 2019 the third best year in the past decade. However, 2020 is expected to be considerably worse as global cigarette sales face the impact of the coronavirus.
Average pack price growth accelerated marginally in 2019, with the global average up by 1.5 percent (versus 1.1 percent growth in 2018) to reach $2.6 ($3.30, excluding China). However, this uptick still represents the second-slowest unit price growth on record since 2008, and despite some short-term respite in 2020, year-on-year unit price expansion is expected to slow to just over 1 percent by 2024.
At 2.7 percent, cigarette value decelerated slightly in 2019, with more sluggish growth in developed markets such as Western Europe and North America balanced by quicker expansion in China, the rest of Asia-Pacific and Eastern Europe. In constant terms, revenue remains challenging for the industry to deliver—particularly in the context of the disposable income pressures that will follow the Covid-19 pandemic, according to the report’s authors.
Absolute volume growth of illicit volumes surged by almost 7 percent (excluding China) in 2019 to reach 400 billion sticks globally. This represents the largest single-year growth in illicit volumes in decades, even ahead of the upcoming Covid-19 effect and was driven by a significant shift in the Russian market, which accounted for 45 percent of the additional volumes.
Bhutan has temporarily reversed a ban on the sale of tobacco, citing the coronavirus pandemic.
The Himalayan kingdom prohibited the sale, manufacture and distribution of tobacco more than a decade ago but allowed smokers to import controlled amounts of tobacco products after paying hefty duties and taxes.
Smoking is considered a sin in the mostly Buddhist country, where a tobacco control law was first passed in 1729 and the tobacco plant is believed to have grown from the blood of a demoness.
The tobacco ban spawned a thriving black market for cigarettes smuggled over the border from India.
When Bhutan closed its frontier with India earlier this year because of the coronavirus pandemic, under-the-counter tobacco prices soared fourfold as the traffickers found it harder to get into the country.
To temper demand for the smuggled cigarettes and, in theory, lessen the risk of cross-border contagion, Bhutan decided to suspend its tobacco ban. The decision allows smokers to buy tobacco products from state-owned duty-free outlets for the duration of the pandemic.
The U.S. Patent Office has granted Sting Free AB a patent (US 15/255,163) for a technology that makes snus and other nicotine pouch products more accessible to adult consumers by eliminating the stinging sensation associated with their use.
The European Patent Organization too intends to grant a patent covering 39 nations for the technology. Sting Free AB already holds the Swedish patent rights to this invention.
The new technology, which was first covered by Tobacco Reporter in July 2017, comprises a pouch of which one side is impermeable to liquids. In addition to eliminating the stinging sensation commonly associated with many pouch products, the technology also allows manufacturers to enhance flavors, pH levels and nicotine release profiles. Products that can benefit from its technology include snus, moist snuff, tobacco-free nicotine pouches and CBD, according to Sting Free AB.
Snus is considered less risky to health than smoking, and many tobacco users, particularly in Sweden, have used the product to reduce or eliminate their exposure to the harmful byproducts of combustion.
Grand View Research expects smokeless tobacco products to generate $5.6 billion globally in 2020 and $22.2 billion by 2025. Because the stinging sensation is often cited as the No. 1 deterrent for new users of oral nicotine products, Sting Free AB believes its new technology could expand the addressable market of adult consumers considerably.
Bengt Wiberg
“We foresee that the already impressive market growth for pouched products containing nicotine will increase substantially when more manufacturers and brands adopt our sting free technology,” says Sting Free AB CEO Bengt Wiberg.
The sting-free technology has already been successfully produced in a prototype series using unmodified industrial snus packaging machines. In 2017, the innovation received a Golden Leaf Award in the “Most exciting newcomer to the industry” category at the GTNF in New York City.
Sting Free AB has a nonexclusive licensing agreement with Swedish Match, the world’s largest Swedish snus manufacturer and producer of the successful Zyn nicotine pouch. It has also signed pre-licensing agreements with several other manufacturers of snus and nicotine pouch products.
The U.K. Vaping Industry Association (UKVIA) has urged British health authorities to continue their pragmatic policies on vaping.
Last month, U.K. Health Secretary Matt Hancock announced that Public Health England (PHE) was being scrapped and merged into the new National Institute for Health Protection. PHE has supported vaping as a vital tobacco harm reduction tool.
In the nicotine business, PHE is best known for its 2015 assertion that vaping is 95 percent less harmful than smoking.
“Whenever responsibilities are transferred there is a risk that invaluable institutional knowledge and memory is lost. This would be to the detriment of the U.K.’s millions of smokers and vapers and cannot be allowed to happen in this case,” said John Dunne, director of the UKVIA.
“The UKVIA calls upon the custodians of PHE’s former responsibilities, in the event that they are indeed reallocated, to continue their positive approach towards harm reduction technologies. Independent reviews, studies and statements, all focused on facts rather than hearsay, have been a cornerstone of a successful British vaping industry which supports adult consumers to make a positive change for their health,” Dunne said.
A Thai Covid-19 vaccine produced with proteins from tobacco leaves has proved successful in animal tests, reports The Bangkok Post.
Thiravat Hemachudha, head of the Thai Red Cross Emerging Infectious Disease Health Science Center, said the latest vaccine had been tested on mice and monkeys with satisfactory results and will now go through a purification process before it is tested in human trials.
Developed Baiyaphytopharm, the vaccine is produced by integrating the virus’ DNA into tobacco leaves. The plant responds to the DNA and produces the desired proteins about a week later. Hemachudha said the vaccine not only produces antibodies but can also stimulate T cells to produce antibodies themselves when meeting the virus.
Bai Ya is reportedly in talks with the National Vaccine Institute (NVI) to see if it is ready to collaborate in the purification process of the vaccine candidate. If the NVI agrees to take part, the vaccine will be ready for human trials in three months.
If not, a new plant will have to be built, delaying human trials by nine months.
After human trials, the vaccine’s manufacturing at an industrial scale would take place quickly, according to Hemachudha. He added that the tobacco leaves can grow to produce more than 10 million doses of the vaccine in one month.
A parliamentary panel in India has proposed foreign direct investment (FDI) in tobacco cultivation and cigarette manufacturing for exports
Tobacco-related FDI is currently restricted in India.
Headed by V. Vijaysai Reddy, the Upper House’s standing committee on commerce recommended 100 percent FDI in tobacco cultivation on the lines of tea, coffee and rubber with the safeguard that tobacco produced with the help of foreign capital should be marketed at auction.
In case of cigarette manufacturing, the panel has backed overseas investment on the condition that it takes place only in special economic zones and that the products are sold outside of India.
Lawmakers are also mulling proposals to set up “export only” tobacco farms to generate revenue.
The U.S. Food and Drug Administration (FDA) plans to publicly list all e-cigarette manufacturers that want permission to sell their products in the U.S., reports Bloomberg, citing a blog post published on Monday by Mitch Zeller, director of the FDA’s Center for Tobacco Products.
The move could help consumers and retailers spot illegal products.
Vapor product manufacturers who want to keep their products on the U.S. market will have to file requests for marketing authorization with the FDA by Sept. 9.
The FDA has received applications for about 2,000 e-cigarettes and other newly regulated tobacco products already. There are more than 400 million eligible items that would need to apply to stay on the market, according to Zeller.
Products whose applications were filed on time will have a one-year grace period to stay on the market while the FDA reviews them, unless the agency rejects the request. Large manufacturers, retailers who could be liable for selling illegal products and public-health groups had pushed the FDA to make the process more transparent.
In a letter to the FDA, several retail associations had asked the agency to release a list of manufacturers that have PMTAs on file so retailers can know what electronic nicotine delivery system (ENDS) brands can remain on store shelves.
Swisher International will change its corporate identity to Swisher, signifying the expansion of Swisher’s vision, offerings and focus on adult consumer lifestyle.
“While Swisher has always been anchored around its loyal adult consumers, partners and employees, the company is working to build a bold future centered on creativity and innovation,” the company wrote in a press note.
John Miller
“We have truly seen an evolution in the tastes of adult consumers, including the preference for lifestyle products within the tobacco category and beyond,” said John Miller, president of Swisher. “We are poised to explore and innovate in new categories while also preserving the legacies and strengths of our existing product portfolios.”
Best known for its Swisher Sweets cigars and classic tobacco brands such as Optimo, Goodies, King Edward and Mail Pouch, Swisher has in recent years expanded its offerings with Drew Estate’s premium cigars, Hempire hemp rolling papers and Rogue’s portfolio of nicotine-on-demand products.
This strategic approach expands Swisher’s capability to address shifting adult consumer preferences while continuing to focus on success in its core businesses, according to the company.
“Swisher’s five strategic businesses—Swisher Sweets Cigar Company (Large & Little/Filtered Cigars); Fat Lip Brands (Smokeless); Drew Estate (Premium Cigars); Hempire (Hemp Products); and Rogue Holdings (Modern Oral Nicotine)—provide category expertise, product knowledge and a focused approach under a renewed purpose for the company,” the company stated.
Several medical and health organizations have urged Indonesia’s Health Ministry to accelerate its cigarette package graphic health warning revisions to Government Regulation No 109/2012. The groups noted that the draft revision began in May 2018 and should have been completed in a year’s time. The Coordinating Human Development and Cultural Affairs Ministry has also asked the ministry to review the regulations on online cigarette advertising and controlling vapor product consumption.
Tubagus Haryo Karbyanto of the National Commission on Tobacco Control (NCTC) said, “The slow revision process shows the government’s lack of awareness about the urgency of controlling high cigarette consumption in Indonesia. The Health Minister should immediately complete his homework.”
Aru Sudoyo of the Indonesian Cancer Foundation noted the nation’s high incidence of lung cancer among men (at 19.4 cases per 100,000), whole Indonesian Teachers Association chairman Unifah Rosidi said, “The Health Ministry does not seem to take the situation seriously while our children have very [poor knowledge] on the dangers of smoking.” Indonesian Heart Foundation chairman Esti Nurjadin said that the foundation had sent a letter urging President Joko Widodo to push for the revised regulation.
