Category: Covid-19

Leaf Sales Commence in Malawi

Photo: Taco Tuinstra
Maximum prices for contract tobacco reached $2.30 per kg while noncontract leaf fetched $1.20 on the first day of the tobacco selling season in Malawi.
Minister of Agriculture and Irrigation Francis Kasaila on Monday officially opened the 2020 marketing season at Lilongwe Auction Floors with a secret price-bidding exercise.
With the social distancing measures to combat the coronavirus, only about 3,000 tobacco bales will be put up for sale daily. In past years, about 10,000 bales would be put up for sale per day.
In his remarks, minister Kasaila urged the stakeholders to work with farmers to make sure that they produce high-quality leaf.
He expressed his optimism that this year’s marketing season will be good and satisfactory despite the Covid-19 pandemic.
The minister further commended the Tobacco Commission, Auction Holding Limited (AHL) and the tobacco-buying companies for taking proactive measures against the virus pandemic as evident in the availability of sanitizing and hand-washing materials at the floors and around the AHL premises.

April 21, 2020
Zimbabwe: Tobacco Sales to Be Decentralized

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Zimbabwe will decentralize its tobacco sales this year to avoid concentrations of people and prevent the spread of the coronavirus, according to President Emmerson Mnangagwa.
“With regards to the tobacco sector, the Tobacco Industry and Marketing Board has been sitting and consulting our Covid-19 Inter-Ministerial Taskforce, and they have come to an arrangement where the tobacco auction floors are going to be decentralized countrywide to minimize crowding,” said Mnangagwa.
“In the process, they are going to observe the measures, that is, social distancing, and also the question of accommodation will be regulated as to who comes and on which day because the areas of concentration will be limited in terms of the centralization.”
The tobacco marketing season, which normally starts mid-March, was put on hold because of the health threat posed by Covid-19.
Farmers are expected to get half their earnings in U.S. dollars, with the rest in local currency at the prevailing interbank rate.
The date for the opening of the auction floors is yet to be announced.

April 21, 2020
South Africa Cigarette Ban Challenged

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The Fair-trade Independent Tobacco Association (FITA) plans to mount a legal challenge against South Africa’s temporary ban on cigarette sales, which was implemented to help prevent spread of the coronavirus.
“The simple truth is that the current situation cannot be endured for much longer by the various role-players along the tobacco industry value chain without severe consequences for all,” said FITA Chairman Sinenhlanhla Mnguni.
“Allowing the current situation to continue indefinitely will in all likelihood lead to job losses and/or loss of income for many along the tobacco industry value chain,” he added.
Mnguni pointed out that people had started being assaulted and murdered for cigarettes. “We are also seeing the illicit trade flourish whilst the legitimate tobacco industry is prevented from participating,” he said, adding that the government is missing out on some ZAR1.5 billion ($79.01 million) a month in excise tax revenue alone.
“This at a time when we are already dealing with huge deficits as far as our tax collections are concerned with the recent announcement that the South Africa Revenue Service collected ZAR66.2 billion less than estimated for the last financial year,” said Mnguni.

April 21, 2020
Imperial Brands Delays Release of its Half-Year Earnings

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Imperial Brands will delay the release of its half-year earnings for fiscal year 2020 by two weeks due to the coronavirus outbreak. The company will now release its report on May 19 instead of May 5.
The two-week delay is intended to give auditors more time to prepare and review statements. “With an already tight reporting timetable and with newly appointed auditors, we have therefore agreed with Ernst & Young that the steps both businesses are taking in relation to Covid‐19 mean it will take longer to prepare and review Imperial Brands’ interim financial results,” the company said in a statement.
April 20, 2020
Morgan Stanley: Tobacco Holding Its Own During Crisis
Living up to its reputation for recession resilience, the cigarette industry appears to offer a safe haven in the current uncertain business environment too.
Morgan Stanley analysts Pamela Kaufman and Christine Yang expect cigarette fundamentals to be relatively strong against the current challenging consumer and economic backdrop, reflecting consumer pantry loading, greater ease of smoking while at home and greater consumption from the anxiety brought on by the coronavirus pandemic.
Smoker behaviors and attitudes toward cigarettes do not appear to have been altered by the pandemic, according to Morgan Stanley’s weekly AlphaWise survey of 2,000 consumers.
Nonetheless, Kaufman and Yang expect Philip Morris International (PMI) and the Altria Group to reduce their 2020 guidance along with their first-quarter results
PMI must cope with unfavorable currency exchange rates and moderating IQOS growth in Italy and Russia while Altria must deal with a higher minimum age for tobacco purchases in the United States. While lower gasoline prices may boost cigarette purchases at gas stations, Altria also faces the prospect of consumer downtrading to less profitable cigarette brands due to high U.S. unemployment.

April 20, 2020
Lilongwe Tobacco Market to Open April 20

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The Kanengo tobacco market in Lilongwe will open on April 20 despite the coronavirus lockdown that takes effect in Malawi on at midnight on Saturday, reports The Nyasa Times, citing the Tobacco Commission.
According to the commission’s corporate and business development manager, Hellings Nasolo, Health Minister Jappie Mhango exempted the tobacco market when he announced the lockdown.
“We will go ahead to open the tobacco market as scheduled. However, we have put in place strict measures to ensure that our farmers and buyers are not infected by the disease,” he said.
Most of the tobacco buying companies’ staff members are operating from home in view of the coronavirus.
The Tobacco Commission is yet to announce dates for the opening of the tobacco markets at Chinkhoma, Limbe and Mzuzu.
April 17, 2020
Following Consumer Stockpiling, U.S. Cigarette Sales Plunge

U.S. cigarette sales dropped significantly following initial stockpiling related to the Covid-19 pandemic.
According to Nielsen convenience store data, traditional cigarette volumes fell 8.4 percent for the week that ended April 4.
By comparison, traditional cigarettes sales volume rose 1.1 percent for the week that ended March 22, after states started ordering people to stay home.
Goldman Sachs analyst Bonnie Herzog wrote Tuesday that the sharp decline occurred “as consumers likely depleted their previous pantry-loading.”
Health advocates fear that consumption could rise as smokers spend more time at home during quarantine, away from public places with smoking bans.
“Consumption levels also tend to increase during times of personal stress. Lower gas prices and consumer wages—and/or unemployment benefits—are also key variables for 2020 volumes,” Piper Sandler analyst Michael Lavery was quoted as saying.
Meanwhile, value sales of mainstream vapor products decreased 10.7 percent for the four-week period, but remained up 22 percent over the year.
The decline in demand for closed-pod cartridges, was driven largely by recent federal regulatory changes.
April 17, 2020
India Leaf Exports Expected to Dip by One-Fifth

The current social and economic lockdown due to the Covid-19 crisis in India will cause tobacco product consumption and exports to decline by 20 percent this year, according to the Tobacco Board. The board added that it may ask tobacco growers to reduce its production due to the drop in demand.
A member of India Tobacco Association (ITA) said, “Like any other industry, the tobacco industry also came to standstill due to lockdown. Tobacco auction in AP, which began earlier, was also suspended. It is expected to begin after April 20. Due to delay in supplies and also health advisories on Covid-19, there may be muted demand this year. Tobacco Board expects about 20 percent dip in demand this year.”
Last year, leaf production in Andhra Pradesh and Karnataka totaled 124 million kilograms and 103 million kilograms, respectively. About 65 percent of the total amount of tobacco leaf grown in India is exported.
The ITA spokesperson added, “The foreign buyers are yet to come to India and physically inspect the product and place orders, though initial discussions on requirement and quality parameters are over. They changed their travel plans as there is complete lockdown in most of the countries.”
April 17, 2020
Claims About Smoking and Covid-19 Examined

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Francois Balloux, an infectious disease expert at University College London, says there is “bizarrely strong” evidence for the suggestion, made by artist David Hockney and others, that smoking could protect people against the coronavirus.
According to an article in The Daily Mail, data from multiple Chinese studies shows that Covid-19 hospital patients contained a smaller proportion of smokers than the general population (6.5 percent compared to 26.6 percent), suggesting they were less likely to end up in the hospital.
Another study, by America’s Centers for Disease Control (CDC) of more 7,000 people who tested positive for the coronavirus, found that just 1.3 percent of them were smokers—against the 14 percent of all Americans that the CDC says smoke.
Critics, however, attribute the counterintuitive findings to improper recording.
“It’s really difficult to assess how well smoking status has been recorded in an emerging epidemic and a lot of these people have been too sick to answer or may not have replied totally honestly,” said Jamie Brown, a tobacco and public health expert at University College London.
“We know, generally, smokers tend to come from lower income groups, which have poorer access to healthcare and may be more likely to die in the community.”
Both Public Health England and the CDC have urged people to stop smoking to protect their health.
“It is abundantly clear from the research into previous coronaviruses that smoking makes the impact of a coronavirus worse,” British Health Secretary Matt Hancock said last month.
His chief medical adviser, Chris Whitty, added: “If you are going to give up smoking, this is a very good moment to do it.”

April 16, 2020
Zambia to Protect Farmers Against Virus

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The Tobacco Board of Zambia (TBZ) says measures have been put in place to protect farmers from contracting Covid-19 during the marketing season.
Chief Executive Officer James Kasongo said the booking of tobacco for sale during the marketing season will be done electronically—through email or text messaging.
The TBZ bright leaf system will book tobacco at Lusaka main sales floor and will be linked to the organization’s regional offices, according to Kasongo.
April 16, 2020