Category: Print Edition

  • Passing the Torch

    Passing the Torch

    SPI Development’s new building the has enabled the company to bring together people working on similar aspects of the company’s business within discrete areas, while facilitating communications and increasing comfort. | Photo: SPI Development

    Danielle Roxborough takes the helm from Henry Tuck as SPI Developments enjoys a period of steady growth.

    By George Gay

    Danielle Roxborough

    Talk to a lot of people, especially those not working within the tobacco industry, and they will tell you the industry is in decline. They will tell you that smoking rates are falling in many markets and plummeting in some others. And there is truth in this, though it raises a question about how, for instance, the U.K.-based fluids control company, SPI Developments, which is heavily involved in the industry, has been expanding and is expecting to continue to expand. But SPI’s managing director, Danielle Roxborough, has a rather neat explanation for this apparent enigma. The tobacco industry had not declined, she told me in April; it had been shaken up, and, consequently, a lot of new opportunities had been exposed to the light.

    I was speaking on the telephone with Roxborough and Henry Tuck during a management transition period when she was still business development manager and managing director designate and he was preparing to stand down as MD on May 31.

    In his own way, Tuck endorsed Roxborough’s view of what had happened, saying that since joining BAT and starting what was to become a 40-year career in engineering, mostly in the tobacco industry, he had seen the consolidation of the industry’s manufacturing base but an expansion of its products. What had been an industry concentrated on producing traditional tobacco cigarettes that were largely unchanged over decades was now also producing a range of new generation products that were being frequently updated and replaced. The life spans of these new products were short, Tuck noted, and every new iteration came with potential opportunities for SPI.

    While SPI has always had a good foothold in flavor application equipment, this year has seen a major increase in orders.

    Vote of Confidence

    That SPI, which is part of the Tembo group of companies, has confidence in the future was underlined about six months ago when it moved within its hometown of Rotherham, Yorkshire, into a new building that Roxborough described as being “expansion proof.” The new facility has allowed the coming together of SPI and its subsidiary A1, which is responsible for machining components for SPI’s equipment. The two companies used to operate from premises on opposite sides of the road on which they were sited but are now housed together in a single unit that provides more space for all aspects of the company’s operations.

    To give an idea of the size of the new premises and what the move means, Roxborough explained that whereas previously, space limitations had meant that engineers had struggled to build even a single RWM, the company’s biggest machine that applies menthol to the tissue side of foil bobbins, earlier this year, they had built three simultaneously. In addition, the new space had allowed what Tuck described as significant investments to be made in new turning and milling machinery, which space limitations would not have allowed previously. All in all, what these developments added up to was an increase in productivity and a reduction in lead times.

    The move has also allowed the bringing together of people working on similar aspects of the company’s business within discrete areas but also an improvement in communications between those areas, a general increase in comfort and a consequent boost in morale. And, of course, there are the intangibles. Tuck said that the building had given the company a bigger, more professional feel while Roxborough reflected on how the new building’s glass frontage provided much natural light, saying, “it is amazing what it can do for your day.”

    Cross-Fertilizations

    As well as operating out of a new facility under a new MD, SPI has a relatively new designation as a fluid control company, something that stems from its status as the fluids expert within the Tembo group, from the business cross-fertilizations provided through cooperating with other members of the group and from the need to keep abreast of the expanded requirements and horizons thrown up by the arrival on the market of modified cigarettes and new generation tobacco and nicotine products. Roxborough said that whereas most of SPI’s equipment was concerned with the application of adhesives and flavors to cigarettes, filters and heat-not-burn (HnB) products, the company now found itself involved in projects and R&D efforts involving different fluids, either within or without the tobacco industry.

    An example of the way in which the cross-fertilization of ideas can be exploited occurred some time ago when it was realized that a spiral-wound and glued paper tube being developed for an HnB project had basically produced a prototype paper drinking straw at a time when the EU was looking to ban single-use plastic drinking straws. And a bigger project has seen SPI involved with a sister Tembo company in detergent dosing systems for detergent pod manufacturing machines.

    Drivers of Demand

    But the focus is nevertheless on the tobacco industry, where a major driver of demand has been the need in some markets to replace cellulose acetate filters because of regulatory requirements and/or environmental concerns. Whereas the technology governing the production of cellulose filters has been largely standardized for some time, that for the current major alternative, crimped-paper filters, is still evolving, so SPI finds itself working with customers on different methods of applying various fluids to paper filters to help reproduce the taste generated through cellulose filters, to which smokers have become accustomed. In the future, such projects will likely widen to take in materials other than paper.

    Another driver is being provided by HnB products and the fact that increasing numbers of companies are producing their own versions. Tuck said that while traditional cigarettes were fairly standard and so the technology used to manufacture them was standard, in the case of HnB products, companies were being innovative and including different materials. Product lifetimes could be as short as three years or four years, after which it was a matter of working with the customer on the next iteration as part of an ongoing process. This manner of working represented a fundamental change from that which had guided the traditional tobacco product industry.

    But while the need to work in new ways with new materials is driving additional demand, the fundamentals of SPI’s business keep going. Roxborough said that while SPI had always had a good foothold in flavor application equipment, this year had seen a major increase in orders. And there had been solid demand, too, for upgrades of glue application systems.

    Manageable Growth

    Roxborough, who studied communications but who has filled commercial roles since graduating from university, has spent her 22-year career working with engineering companies, almost entirely those serving the tobacco industry. She has been with SPI for more than nine years and admits to being passionate about the company—a passion that tips over into confidence about the future. Joining the Tembo group had been hugely positive for the company, providing it with the opportunity to grow at a manageable pace, she said. And looking to the future, SPI and A1 had a great team of about 30 U.K.-based employees, including designers and engineers who could react quickly to new challenges emerging in the field of fluid control. At the same time, it could call on the resources of other Tembo group companies around the world.

    Although Tuck has now left the business after 18 years, Roxborough is not short of experienced support. Paul Leverick, who Tuck described as a “fantastic engineer” and who is the founder and chairman of SPI, is still in place, ready to mentor the younger engineers and the management team. It was Leverick and Tuck, the shareholders of SPI, who realized that the long-term future of SPI lay with ITM, later to become the Tembo group, and who sold it when that opportunity arose in 2018.

    Taking Hurdles in Stride

    They also helped steer the company through Brexit and the Covid pandemic. Tuck was reluctant to spend much time talking about Brexit, but it was clear from what he did say that he was not a fan. Brexit, he said, had cost SPI time and administrative effort, but the company had nevertheless taken these hurdles in its stride and would continue to do so—because EU legislative changes would be ongoing and would continue to have an impact on any company such as SPI that exported to the EU.

    In respect of the pandemic, the decision was taken early on that it was not viable for everybody to go home, so the company kept going while taking measures to keep its people safe, including by allowing those who were able to do so to work from home. In the end, the pandemic had little impact on the business, apart from the adjustments that had to be made to introduce the remote installation of equipment.

    With the sale of SPI to the Tembo group, the Covid pandemic, Brexit and the move to the new building, the past six years have been busy, but then so were the previous 12 years. When Tuck joined SPI as MD in 2006, the company had only four other employees, and it offered only PVA glue systems and a simple flavor application system. Now it has 30 employees, a much-expanded equipment offering and is part of a multinational group.

    Looking back, Tuck described working in the tobacco industry as being very interesting. As an engineer, he had found it “technically amazing” while the opportunity to travel the world had been mind-expanding. He would remember the industry as comprising a group of people who were open and welcoming.

    Finally, Tuck said that one of his more recent goals had been to move the company into a new building, and now that had happened. “I’m very happy with the management team; they are doing very well, and we have a good order book, so now is a good time to go,” he said.

    Leading the Livery

    Henri Tuck

    Although the accompanying story implies that Henry Tuck, until May 31 the managing director of SPI Developments, has left the tobacco industry, this is not strictly true. From June 5, he was due to have been elected and installed for one year as the master of the U.K.’s Worshipful Company of Tobacco Pipe Makers and Tobacco Blenders, of which he has been a member for about 10 years.

    Tuck, who used to have a long commute between his home and SPI’s premises, said that, since the Covid pandemic had struck, he had spent increasing amounts of time working from home, relying on the company’s management team for SPI’s day-to-day running. Basically, he added, he had been working himself out of a job and that, though he was shy of normal retirement age, it had made sense to leave in time to take on his new role, which would comprise a full-on year, chairing and running the livery company, and attending internal and external events in the city of London.

    The livery company has its foundations in the craft of clay pipe making, a craft that it is trying to keep going. There are two or three people left in the U.K. who make clay pipes for a small market comprising mainly those working in period films and dramas and those running reenactment societies. The company has a benevolent fund that helps various charities that fit its criteria, and within which is a welfare fund for former tobacco workers in the U.K. who have fallen on hard times.

    The company, which has close to 200 members, is one of 111 such companies in London that together donate about £75 million ($93.91 million) a year to charitable causes. Education, too, is a big part of the livery movement, and some companies have maintained traditional functions, such as supporting apprenticeships.

    It is worth noting that Tuck was introduced to the livery company by the person who preceded him as master, Elise Rasmussen, the founder and chief director of the GTNF (Global Tobacco and Nicotine Forum) Trust and vice president of sales and marketing at the U.S. Tobacco Manufacturers’ Association, which owns Tobacco Reporter. Tuck said that Rasmussen had been a great success in the role and that it would be hard to fill her shoes. She was known by everybody in the city and the livery movement. “Once met, never forgotten,” he said. —G.G.

    George Gay is Tobacco Reporter’s European editor, but his territory spans the globe. Based in London, George has covered the tobacco industry since 1982, initially for a U.K.-based publication and since 2004 for Tobacco Reporter. George’s understanding of industry issues, combined with his keen sense of observation and dry wit, have earned him a loyal following among Tobacco Reporter’s readers.
  • Pulling its Punches

    Pulling its Punches

    Photo: Christoph Burgstedt

    China, the world’s largest supplier of e-cigarettes, has failed to take full advantage of the risk reduction opportunities offered by vapes.

    By George Gay

    An Aug. 27 heading on a story in Singapore’s The Straits Times proclaimed, “300 million and counting: Why China just can’t kick the cigarette habit.” Newspaper headings are normally not written by the writers of stories and are aimed at grabbing the reader’s attention, but they should accurately reflect the story. In this case, however, there is a disconnect because whereas the story credits China with having an estimated 300 million smokers, nowhere does it say that number is rising, which I would expect given that the heading adds “and counting.” Indeed, the story does not claim that volume consumption is heading up, saying rather that such figures are not published.

    Another thing that immediately struck me about the heading was the use of the word “habit” rather than “addiction,” which seemed to suggest two things. One was that the story was not going to follow the course of many stories in other countries where the failure to end or significantly curtail cigarette smoking is put down to an inability on the part of authorities to force/encourage smokers to break their addiction despite their using methods that include everything from making cigarettes unaffordable through requiring manufacturers to degrade these products and insulting smokers in respect of their personal hygiene, to, if those smokers are lucky, encouraging the use of reduced-risk products in place of cigarettes. This story, the heading promised, was going to be about other issues.

    At the same time, the heading seems to question whether kicking smoking is a goal worth pursuing. After all, while the usual definition of addiction involves a compulsion that causes harm to the person indulging in the addictive activity, that is not the case in respect of a habit. After all, somebody might be in the habit of repeatedly looking at their mobile phone while supposedly out enjoying the company of a friend over coffee, which, of itself, is unlikely to cause them direct harm, though they might be in danger from the reaction of a sensitive but increasingly irritated friend sitting across the table, at least in polite societies.

    But hang on, the mood changes in the first sentence of the story, which reports that 20 years after adopting the World Health Organization Framework Convention on Tobacco Control [FCTC], “China is still addicted [my emphasis] to cigarettes.” Overall, the word “habit” occurs four times in the story and the word “addicted” twice. This might seem like a small point, but when the subject is what many people believe is the most preventable cause of disease and death worldwide, a reader should be able to expect that basic issues have been properly considered before going to print. English and, I guess, most other languages have what I would call vague words such as “habit” and “addiction,” which can be useful but which need to be used with caution, and clearly not where such vagueness can lead to confusion.

    I am not saying that it is not valid to use “habit” and “addiction” in reference to the same activity, but at least some attempt should be made to explain the distinction and to use the words, not as simple synonyms, but appropriately each time. I might be happy, for instance, to entertain the idea that for some people, smoking is an addiction that is difficult to break while for others it is a habit they can pick up now and again without becoming addicted, but I cannot accept that for the same individual, smoking can be both a habit and an addiction. 

    Muddled Thinking

    I worry that such issues are not considered properly, not only in the case of the The Straits Times but in stories published around the world every day of the week, something that leads to misunderstandings and pressure being put on politicians to enact unhelpful legislation. The public is served up stories that are beset with muddled thinking. We are told, for instance, in The Straits Times story that despite years of anti-smoking campaigning in China, people continue to smoke partly because cigarettes are cheap, there is a lack of public education, and Big Tobacco—presumably meaning the State Tobacco Monopoly Administration (STMA) and the China National Tobacco Corporation—is protected. But how is it possible to reconcile the claims that there have been years of anti-smoking campaigning when cigarettes are still cheap? The WHO and most other tobacco control bodies say that tax-induced cigarette price increases comprise the most important factor in getting smokers to quit. And there surely cannot have been years of anti-smoking campaigning without public education. I ask you, to whom was this campaigning directed?

    I am not saying that the claims are irreconcilable, but they do require some explanation. Is the reason that the extensive anti-tobacco campaigning has been unsuccessful down to the fact that China has followed FCTC policies that, overall, do not work, or that do not work in China, or is it the case that China, either intentionally or unintentionally, has not applied them properly?

    In fact, the story suggests that a major reason why anti-tobacco campaigning has had limited success is down to the power of the STMA and the pushback that it employs when anti-smoking policies are put forward, at least outside the biggest cities. I am happy to accept that this happens, but it does raise a question: Why did China sign up to the FCTC when it must have been aware that implementation of its policies was going to be resisted by a powerful state organization? The answer to the first part of the question, why did it sign up to the FCTC, probably comes within the wide-ranging category of “it seemed like a good idea at the time”—perhaps because at that time, China wanted to be seen as part of the international order, or maybe it was for some other, less obvious reason.

    The answer to the second part of the question is possibly more interesting. Could it be that China does not buy into all the negative publicity that surrounds tobacco? In many other parts of the world, the perceived wisdom is that tobacco is overall economically negative, but is this the case in China? Isn’t China, along, perhaps, to a lesser extent, with Brazil, something of a special case because its tobacco industry is highly economically active, from the tobacco fields, through manufacturing, to retail stores and throughout all the supporting industries and businesses that these activities imply? Frankly, it would be odd if China took the same attitude to tobacco as, for instance, the U.K., where there is no commercial tobacco growing and virtually no tobacco manufacturing. Differences in the healthcare systems of the two nations might also mean that economic calculations come up with different results.

    Could it be, also, that China does not buy into the tobacco health debate in the same way that many other countries do? In a world plagued by pollution, perhaps it finds it hard to accept the death toll normally attributed to tobacco smoking alone, as I do. I can think of other reasons why China might take a different view of cigarette consumption to that taken by some other countries, but I don’t want to encourage a sack full of letters of outrage, so I shall keep them to myself.

    A Missed Opportunity

    I am not saying that such thinking comes into play in China. In fact, I would be surprised if it does because, strangely, China seems to forge a tobacco path that is not that much different to the paths forged elsewhere and one where, certainly in places, it is aligned with the WHO’s de facto policies.

    Take reduced-risk products, for instance. One would have thought that in China, vapes would have comprised a powerful tool for allowing smokers to transition away from cigarettes—perhaps a more powerful tool even than it is in many other countries. I say this because The Straits Times story makes the point that smoking plugs into long-established social mores in China, one of which means that cigarettes are considered appropriate business gifts. Elegantly designed vapes would surely make acceptable—perhaps even better—alternatives in this regard and could be made to reflect the often-elegant, iconic branding of cigarettes.

    But China seems not to have taken full advantage of what vapes could offer it, which is especially odd given that, I assume, it is the world’s leading supplier of vaping devices. Rather, it seems to have fallen for the idea that flavored vapes, the vapes most effective in encouraging smokers to switch away from cigarettes, should be banned because they are attractive to young people.

    To me, this is the same sort of muddled thinking that crops up time and again in other countries. But at least it possibly provides an answer to the question implied by The Straits Times. Perhaps China will be able one day to break its cigarette “habit,” but, with one hand tied behind its back, it is going to take an awfully long time.

    But then the reporter from Singapore should understand this. Singapore, I think, once proclaimed that it would quit smoking by 2000, and that was in the days when “quit” meant just that, not reduce the smoking rate to 5 percent or thereabouts. Did it make that deadline? No; a quarter of a century later, it is still a work in progress, and it is likely to be so for many years to come. It likes to operate with two hands tied behind its back—it bans vaping outright.

    George Gay is Tobacco Reporter’s European editor, but his territory spans the globe. Based in London, George has covered the tobacco industry since 1982, initially for a U.K.-based publication and since 2004 for Tobacco Reporter. George’s understanding of industry issues, combined with his keen sense of observation and dry wit, have earned him a loyal following among Tobacco Reporter’s readers.
  • Realists and Idealists

    Realists and Idealists

    Image: M-SUR

    We should celebrate ‘realists’ and beware of ‘idealists.’ Idealists do well in the rhetorical world of goal setting, aspirations and optics while realists do better in the real world. The problem is that the idealists obstruct the realists.

    By Clive Bates

    On April 22, the British Medical Journal and a new investigative publication, The Examination, funded by billionaire activist Michael Bloomberg, declared a victory. Their “investigation” had shut down a new continuing medical education program in smoking, tobacco and nicotine offered by the respected medical information provider Medscape. The course had been running for a few weeks and had proved popular with participants. It had been designed to address an essential unmet educational need: the widespread confusion among healthcare practitioners about the causes of disease, the nature of nicotine use and the options available to reduce the harms. It’s hard to imagine more valuable and actionable public health and preventative insights for practitioners. So why close it down? Simple: The initiative had been funded at arms-length by a tobacco company, Phillip Morris International, which played no role in developing the content.

    It’s worth pausing to examine what has been achieved here. The objection to tobacco company funding in the case is essentially aesthetic. To some activists, it just doesn’t look right. Tobacco companies involved in ending smoking? Weird! No one has presented material objections to the course content. I have no doubt that it was a sincere effort to raise the lamentable standard of medical knowledge in this area delivered by experienced professionals. The idealists were successful in burning this initiative to the ground. But here’s the point: Like arsonists, they didn’t build anything. They have left nothing where there was previously something useful. The activists have made their impassioned denunciations, expressed their righteous anger and moved on. But it’s an empty victory because the confusion and misinformation remain, and the opportunity to do better for the public and patients has been squandered. 

    I chose this recent example because it illustrates a more general problem with activism. The pursuit of idealistic goals is not necessarily heroic and may not be benign. It can make matters worse with real-world costs for people and the environment. Let’s take three examples from outside the nicotine field to illustrate the point, then return to nicotine. 

    First, the green opposition to nuclear power. In their quest for an idealist vision of a 100 percent renewable system based mainly on solar and wind power, greens have opposed a proven, reliable, low-carbon form of electricity generation. By creating fear and foreboding about nuclear risks, activists and regulators have made the technology exceedingly expensive and difficult to deploy, making fossil fuels relatively more attractive. The French experience from the 1960s shows successful large-scale nuclear deployment, but idealistic opposition has driven the costs upward since then. Finally, idealists are starting to feel the heat from the climate realists.

    Second, activists with an in-principle opposition to genetic engineering recently stopped the deployment of genetically modified golden rice, which is rich in Vitamin A, in the Philippines. Vitamin A deficiency is implicated in up to 500,000 cases of blindness in young children annually in Asia and Africa each year. Maybe it would be better to lift poverty and improve nutrition more systematically, but how long would that take, and how many people would be harmed waiting for the idealists’ more prosperous and just society? Like adding fluoride to water to protect dental health, golden rice would have added Vitamin A to the food supply system, creating widespread health benefits. Now, people will suffer instead.

    Third, local and international nonprofit organizations lobbied tenaciously for Sri Lanka to switch its agricultural system to become exclusively organic, backed up by a ban on the use of agrichemicals. They got their way, but it did not go well. The food supply crashed, the people went hungry and rioted, and the government fell.

    In each case, a noble aspiration, an eye-catching slogan or a grand commitment has stood in the way of making more mundane but pragmatic progress at the expense of human well-being. Some further characteristics are evident:

    • Idealists evade the messy and distinctly realist business of trade-offs, waving away the concerns of realists as a lack of ambition or “industry talking points.”
    • The idealists rarely accept accountability for the unintended consequences of their positions—the fault is with others for not trying hard enough or spending enough to match the idealists’ aspirations.
    • The idealists often receive an easy ride in the media, especially when they evoke youth to make their case. Did anyone ever put hard questions to Greta Thunberg?

    Turning now to the battle between idealists and realists in the world of tobacco and nicotine.

    First, the nicotine-free society. The idealists in tobacco control would like to rid us of this relatively benign recreational drug. Sorry, but that will not happen, and there is no reason why it should. People use nicotine because it makes them feel better, for its pleasurable, functional and therapeutic attributes. However, demonizing nicotine and treating all nicotine products as if they are equally harmful will obstruct the realists’ efforts to address the significant harm caused by smoking. The idealists take each ban and blockage of any nicotine product as progress to their larger goal. How else can we explain the sustained ban on snus in the European Union?

    Second, defending the purity of youth. Though all idealists have been teenagers at some point, few seem to understand them. Some young people have a propensity for risk-taking with drugs, alcohol, sex and other reckless behaviors, and yes, to use nicotine. But the idealists have adopted variants on the mantra “no teen should use nicotine.” Fine, that might be good advice. But what if they go further and try to make that a reality with various forms of prohibition, restrictions and misinformation? The trouble is that the much larger adult market will be bent out of shape by misguided efforts to protect youth. There will be more smoking, more illicit trade and more risky workarounds, including among youth. The realist goal of providing a lawful, acceptably safe, proportionally regulated nicotine market is undermined by the fervor of the idealists, with worse results for everyone.

    Third, the knockout blow. Collectively known as “endgame” measures, these grandiose schemes would abolish cigarettes as we know them, close nearly all retail outlets, impose shrinking production and import quotas, or ban sales to anyone born after a specific date. They have this in common: They won’t be implemented, they won’t work as expected, or they will have little useful effect. But they will obstruct the realists because these ideas divert political, regulatory, scientific capital and creativity into unworkable schemes and away from pragmatic, if humble, measures that will work. Worse, they occupy the imaginary sunlit uplands with a fake utopia, creating a mirage where there should be an achievable destination—a stable, lawful, well-regulated market for a popular drug.

    Fourth, the pursuit of paper tigers. I recently submitted evidence to an inquiry into new legislation in South Africa. The new law had been drafted as model anti-vaping legislation with extreme restrictions and penalties and tell-tale fingerprints of American activists. The contrast between the precision control, on paper, of the new law and the chaotic reality of South Africa’s giant illicit market is matched only by that of Australia’s new legislation that tries to ban vapes even harder, even though over 90 percent of the Australian vape market is already illegal. When the idealists declare a prohibition in law on paper, actual or de facto, it doesn’t make the banned products disappear. However, it does mean that more modest regulation becomes impossible because most of the market is unregulated and illicit.

    Fifth, why don’t they stop making cigarettes? A common idealist theme is that if tobacco companies are serious about health, they should just stop making cigarettes. It sounds superficially plausible and inspiring. In reality, these companies have a legal duty not to destroy their shareholders’ money. If they tried, three things would happen: The management would be fired, the company would be taken over, or the productive assets and brands would be sold as a going concern. All to no effect. The realists recognize the need for a transformation, moving the market to noncombustible nicotine products and diversifying the business into non-nicotine activities in which they have an advantage, keeping their shareholders on board throughout.

    Finally, conflicts of interest (COI). Idealists divide the world into independent and industry science. They see industry conflicts of interest as disqualifying from scholarly societies and journals. Yet, conflicts arise from every funding source or institution with policy preferences. An industry COI may be no more than a sign of having valuable marketable capabilities. The realists want to engage with anyone with specialized knowledge and, with due skepticism, to learn from their insights. The idealists prefer to erase them from the discourse and pursue purity at the expense of knowledge.

    To summarize, the idealists will resist the realists, and everything will be worse.

    Clive Bates is the director of Counterfactual Consulting and the former director of Action on Smoking and Health (U.K.).
  • Quitting Camel Country

    Quitting Camel Country

    Photo: Medwakh

    Dokha, shisha, vapes: THR in the Middle East region

    By Cheryl K. Olson

    Tobacco has been part of daily life in the Middle East since the 1600s. An archeology journal describes excavations in Istanbul uncovering “massive numbers” of broken clay tobacco pipes from the centuries before the rise of cigarettes. Some of the highest smoking rates in the world are found in Middle East nations. Over half of men in Jordan smoke, for example.

    “The Middle East has got an extremely long culture in terms of smoking. That’s going to be really hard to turn round,” says Harry Shapiro, a U.K.-based educator who reports on global tobacco harm reduction. Based on data from the World Health Organization, smoking was projected to decrease among men in the region by less than 2 percentage points, from 33.1 percent in 2010 to 31.2 percent in 2025.

    Most of the top causes of death in countries in the region are either caused or worsened by smoking. New approaches are urgently needed. Yet there is a frustrating lack of information on where and how to start. A 2024 WHO report on global tobacco use trends notes that data in the Eastern Mediterranean region “are the least robust,” i.e., limited or outdated.

    What’s different about the Middle East when it comes to tobacco use? What’s the need for tobacco harm reduction? And what factors might support or block the uptake of reduced-risk products?

    Shisha, Dokha, Shammah

    A U.S. university professor who has studied tobacco use trends in the region (and asked to remain anonymous) shared his local experiences and findings with me. One issue he faced was collecting information on reduced-harm products not yet authorized by regulators. Given Middle East government policies, researchers can’t ask questions about illegal behaviors. “I could be compelled to give individual-level data regardless of what people signed about confidentiality,” he said.

    After the United Arab Emirates legalized e-cigarettes, his surveys found that vapes were widely used. “People shifted back and forth between cigarettes, e-cigarettes and a local tobacco called dokha, which means “dizzy.” Because you can inhale the equivalent of one cigarette’s worth in one or two quick puffs,” he said (see “Old School, Modern Market,” Tobacco Reporter, August 2014.)

    Tobacco use in the Middle East has largely centered on three products. Cigarettes currently dominate, with use rates hovering around 30 percent for men. In most of the region, smoking is culturally unacceptable for women. Given the reluctance to admit to smoking, reported female use rates of about 2 percent may in reality be several times higher. In Lebanon, the professor noted, women can openly smoke. There, use rates are around 30 percent for both genders. Concerningly, his colleagues in that country feel that Lebanon is the tobacco use trendsetter for the region.

    A second popular regional product is shisha tobacco, smoked through a water pipe or hookah. Use reportedly increased in the 1990s when flavored products emerged. “Previously, it was mostly grizzled old men in coffee shops,” the professor noted, “but the new products weren’t harsh or unpleasant in taste and became trendy among young people.” A 2020 review of research found “alarmingly high” use among university students in the region, including by women.

    Hookah smoking is a social activity. A college student in Abu Dhabi might go out with friends and smoke hookah once or twice a week or once per month. However, some users are addicted and will smoke daily.

    What sets shisha apart is the communal pipe. “There might be multiple hoses, but you’re still breathing through the same water and sharing germs,” the U.S. professor noted. “A session might go on for an hour and generate the same volume of smoke as five packs of cigarettes.” This means exposure to a huge quantity of smoke, even at the secondhand level. Even worse? Inhaling toxins and carbon monoxide from the charcoal burned to heat the waterpipe.

    Finally, there is dokha. This powdered tobacco comes in different varieties and strengths and is often mixed with herbs, spices and other substances. Dokha is smoked in a small pipe (usually wooden) called a midwakh. Some users perceive it as a safer alternative to smoking, but the limited research suggests that dokha may give off more toxins than cigarettes. Despite dokha being as common as cigarettes in countries such as the UAE, published studies on dokha use, effects and cessation have been rare.

    A regional oral tobacco product also merits mention and more study. Shammah is reportedly common in Saudi Arabia and Yemen. Locally made by mixing ground tobacco leaf with flavorings (including lime, ash, black pepper and oils), shammah contains a variety of potential carcinogens, including nitrosamines.

    Reducing Risk

    Several countries in the Middle East (such as Iran, Oman and Qatar) still ban e-cigarettes, and others (e.g., Saudi Arabia) ban snus. But in general, the region has bucked the global trend, loosening regulations on vaping and heated-tobacco products. Nicotine pouches are largely unregulated. (See the Global State of Tobacco Harm Reduction website, GSTHR.org, for country-by-country information.)

    More research is critically needed to help channel information and support to those Middle Eastern subgroups most endangered by their tobacco use behaviors. University students who occasionally smoke shisha, for example, likely face minimal risk.

    Most evidence on vaping originates from North America and Europe. As a recent paper on e-cigarettes in the Middle East points out, studies within the region suffer from “overreliance on university-based samples, the overuse of non-user samples, a lack of studies on behavior change, high variance in existing data and a lack of uniform instruments to measure e-cigarette use.”

    Shisha is a good example of the need for cultural sensitivity in promoting smoking cessation or a switch to less risky alternatives. “For hookah, people smoke very much for the social reason. It’s a social construct, not an addiction construct,” said the U.S. professor. “Most cessation interventions have not really worked because most have thought about hookah like cigarettes, with nicotine-replacement therapy and counseling.”

    As one college student in the UAE told him, “People don’t drink alcohol here. There are no drugs. We need a way to hang out with our friends.” Effective reduced-risk substitutes for waterpipe smoking must deliver that.

    Companies have begun creating reduced-harm products specifically for Middle East countries.

    For example, Dubai-based ANDS (short for alternative nicotine-delivery solutions) makes vaping and heated-tobacco products. A company called OOKA has developed a charcoal-free shisha device. Philip Morris International recently acquired a stake in Eastern Co., Egypt’s largest tobacco producer, with a stated goal of providing alternatives to cigarettes for adults who smoke.

    New technologies can make an attractive contrast to smelly old-fashioned cigarettes. “A lot of the vaping devices are really quite geeky—like a fancy electronic gadget that happens to deliver nicotine,” notes Shapiro. “They have touch-screens, and you can chart use on your laptop. So that’s likely to appeal to the younger generation of more wealthy urban groups” in the region. However, such products are likely to reach few lower income or rural people who smoke.

    Shapiro notes that two things are necessary for reduced-harm nicotine to gain a foothold and start displacing cigarettes. First, “Governments have got to be prepared to get tough on smoking: banning smoking in public areas and such.” Second, there needs to be proportionate promotion of novel products, including lower taxes versus cigarettes, and education that supports the option of harm reduction alongside cessation. As a recent Lancet commentary (by former WHO leadership) notes, “In some countries, substantial reductions in smoking prevalence have coincided with novel nicotine products.”

    “If a country does ban safer nicotine products, look at how much it relies on the tobacco industry—in terms of revenue from taxation or whether the country grows tobacco or exports it,” says Shapiro. “If state regulation is sympathetic, then these products will find a way into the shops.”

    The presence of the World Vape Show in Dubai, starting in 2021, sent a message that these alternatives could be acceptable. I will be part of two panels at the 2024 Global Vape Forum, which accompanies this year’s Dubai vape expo. We will stress the need to save lives by moving people off combustible tobacco, whether through cessation or switching to reduced-risk products.

    Getting doctors on board with harm reduction is another important step. Like their colleagues around the globe, Middle Eastern physicians frequently misperceive nicotine as the cause of cancer and other health risks of tobacco. Region-specific studies of doctors’ perceptions and needs are essential. I could locate only one small study. A 2019 Egyptian survey found that doctors were aware of e-cigarettes but viewed them less positively than their patients.

    Cheryl K. Olson is a California-based public health researcher who specializes in behavioral health issues and consults on tobacco product behaviors via McKinney Regulatory Science Advisors. She spent 15 years on the faculty of Harvard Medical School.

    References

    Al-Hamdani M, Hopkins DB (2023). E-cigarettes in the Middle East: The known, unknown, and what needs to be known next. Preventive Medicine Reports. https://doi.org/10.1016/j.pmedr.2022.102089

    Beaglehole R, Bonita R (2024). Harnessing tobacco harm reduction. The Lancet. https://doi.org/10.1016/S0140-6736(24)00140-5

    Fouad H, Commar A, Hamadeh RR et al. Smoking prevalence in the Eastern Mediterranean region. Eastern Mediterranean Health Journal. 2020;26:1. www.emro.who.int/emhj-volume-26-2020/volume-26-issue-1/smoking-prevalence-in-the-eastern-mediterranean-region.html

    Nasser AMA, Geng Y, Al-Wesabi SA (2020). The prevalence of smoking (cigarette and waterpipe) among university students in some Arab countries: A systematic review. Asian Pacific Journal of Cancer Prevention. https://journal.waocp.org/article_88992.html

    Samara F, Alam IA, ElSayed Y (2021). Midwakh: Assessment of levels of carcinogenic polycyclic aromatic hydrocarbons and nicotine in dokha tobacco smoke. Journal of Analytical Toxicology. https://doi.org/10.1093/jat/bkab012

    Raj AT et al (2019). Systematic reviews and meta-analyses of smokeless tobacco products should include shammah. Nicotine and Tobacco Research. https://doi.org/10.1093/ntr/nty144

  • Thoughtful Reflection

    Thoughtful Reflection

    Photo: Tobacco Reporter archive

    Speakers and panelists discussed the nicotine value chain during the InFocus virtual conference.

    TR Staff Report

    Participants in the May 22 InFocus virtual conference took a close look at the nicotine value chain, covering agriculture, synthetic nicotine products and innovation in tobacco harm reduction, among other topics. Below are some of the highlights of the event, which was sponsored by BAT, FEELM, Smoore, Alliance One International and Universal Leaf.

    Michael Strupp, professor of neurology at the Ludwig Maximilian University of Munich, addressed misconceptions about nicotine, stressing that it is not a nitrosamine and does not cause cancer. He emphasized the importance of distinguishing between the nicotine molecule and the substances produced by the combustion of tobacco. Strupp highlighted nicotine’s non-toxic nature and clarified that it is not a pesticide. He further explained that nicotine has potential therapeutic benefits, particularly in the treatment of neurodegenerative diseases such as Alzheimer’s and Parkinson’s as well as certain psychiatric disorders like schizophrenia.

    Strupp pointed out that nicotine can enhance attention and memory, improve mood by inducing euphoria and relaxation and indirectly influence body functions such as heart rate and blood pressure. Strupp discussed how nicotine’s mechanism of action has been well understood for decades, acting on nicotinic acetylcholine receptors in the brain. He explained that nicotine mimics acetylcholine, a neurotransmitter, and its interaction with these receptors can enhance learning, memory and attention.

    Concluding his keynote, Strupp emphasized the significance of understanding nicotine’s effects from a scientific perspective. He illustrated how the dopamine reward pathway is involved in nicotine addiction, with nicotine mimicking the effects of neurotransmitters like acetylcholine and dopamine.

    James Murphy, director of research and science at BAT, reflected on the remarkable transformation within the tobacco industry over his career, particularly with the development of three distinct noncombustible tobacco and nicotine product categories: heated products, vapor products and oral pouches.

    As a model for tobacco harm reduction, Murphy highlighted Sweden, where the widespread adoption of snus has led to a dramatic decline in smoking rates to just 5 percent. This shift has resulted in significantly better health outcomes compared to any other country in Europe, demonstrating the potential impact of noncombustible products on public health.

    Unfortunately, the promise of noncombustible combustible products is not reflected in consumer perceptions. Research findings indicated that a record percentage of consumers (90 percent in one survey) now believe that the risks associated with noncombustible products are equivalent to those of smoking.

    This misperception extends to medical practitioners as well, with a majority surveyed incorrectly attributing nicotine as a direct cause of cardiovascular disease, chronic obstructive pulmonary disease (COPD) and cancer. Murphy emphasized the need for education to correct these misconceptions and overcome barriers preventing adult smokers from switching to lower risk products.

    Murphy concluded by underscoring the importance of basing public health guidance on clear, rigorous science. He called for a unified commitment from all stakeholders to prioritize research and harm reduction strategies. A smokeless world, Murphy argued, is achievable through collaborative efforts focused on the well-being of millions worldwide. By dispelling myths and promoting evidence-based understanding of nicotine and noncombustible products, the industry can make significant strides in reducing smoking-related harm.

    Participants in the “Misperception of Nicotine” panel stressed the need for accurate information and education regarding nicotine, calling for global efforts to correct misconceptions and promote harm reduction strategies effectively. The panelists collectively highlighted the importance of engaging respectfully with all sides of the debate, basing policies on scientific evidence and ensuring transparency in public health communications.

    Moderator Jasjit S. Ahluwalia, professor of behavioral and social sciences and professor of medicine at the Center for Alcohol and Addiction Studies at the Brown University School of Public Health and Alpert School of Medicine, opened the panel by emphasizing the need to shift the narrative around nicotine. He pointed out that nicotine is often demonized despite scientific evidence suggesting that it is not the primary cause of smoking-related diseases.

    Ahluwalia highlighted a troubling public misconception that marijuana is safer than nicotine, which is not supported by science. He stressed that while nicotine will continue to be used, the focus should be on eliminating combustible tobacco products, which pose the greatest health risks. Ahluwalia also noted that e-cigarettes, though not without risk, are significantly safer than combustible cigarettes and do not cause cancer or COPD.

    Ahluwalia called for policies guided by science, advocating for accurate information to be provided to smokers about the benefits of switching to reduced-risk products (RRPs). Engaging with those who disagree is crucial, Ahluwalia argued, as there is much common ground and a shared purpose in harm reduction efforts. He also debunked the myth that nicotine use lowers IQs, stating that such misinformation undermines harm reduction efforts and that governments must play a role in correcting these misconceptions.

    Dave Dobbins, former chief operating officer at the American Legacy Foundation/Truth Initiative and consultant to Altria, underscored the importance of listening to all perspectives in the nicotine debate with kindness. He criticized the current tobacco control efforts, which he believes are often led by individuals who are not directly affected by nicotine use.

    Dobbins highlighted the severe health consequences of smoking, noting that cigarettes can reduce life expectancy by a decade and kill half of their users. He emphasized that nicotine delivery through RRPs is significantly safer than smoking.

    Dobbins called for clear, consistent communication with adult smokers, stressing the need to treat them with respect and provide accurate information about the benefits of vapes and pouches. He asserted that it is the duty of everyone, including cigarette companies, to disseminate accurate information about nicotine. Transparency in the origins and funding of scientific research is crucial to ensure trust and clarity in public health messaging.

    Delon Human, a specialist family physician and president of Health Diplomats, began by identifying himself as both a doctor and a consumer, emphasizing the human aspect of smokers. He expressed concern that a significant proportion of doctors (70 percent to 80 percent) incorrectly conflate smoking with nicotine consumption.

    Human criticized the World Health Organization for its inconsistent and unclear stance on nicotine, which also conflates tobacco use with nicotine use. He stressed the importance of the WHO and related agencies following scientific evidence. Human highlighted Sweden as an example of a country providing accurate information about nicotine use, resulting in significantly fewer cancer deaths due to the use of snus instead of cigarettes. He argued that scare stories about e-cigarettes need to be countered with scientific facts.

    Human pointed out that there is substantial opposition to nicotine within the WHO, which will take time to change. He also criticized Article 5.3 of the WHO Framework Convention on Tobacco Control (FCTC), which excludes the tobacco industry from discussions, arguing that this exclusion damages scientific progress and policy development and ultimately costs lives.

    Sudhanshu Patwardhan, nicotine expert and health tech entrepreneur, highlighted a study from the U.K. showing that 44 percent of doctors incorrectly believe nicotine causes cancer—a misconception common worldwide. He pointed out a significant gap between policy and medical understanding, which he said has real-world implications for smokers seeking healthier alternatives.

    Patwardhan called for a global nicotine literacy project to educate doctors and align public policies with scientific evidence. He emphasized the importance of making doctors champions of reason to communicate safer alternatives to cigarettes effectively.

    Patwardhan also stressed the need for sensible regulation that is supported by and encourages industry involvement. He concluded that educating healthcare providers around the world is key to promoting harm reduction.

    David Jones, a member of the U.K. All-Party Parliamentary Group for Responsible Vaping and deputy chair of the European Research Group, emphasized the critical role of tobacco harm reduction in public health policy, highlighting the U.K.’s pioneering “swap to stop” strategy, which provides vape starter kits to smokers to help them quit. He praised the U.K.’s evidence-based approach, which has significantly reduced smoking rates, but warned against recent proposals that could undermine these achievements.

    Jones argued against banning disposable vapes and flavored products, explaining that such measures could drive consumers to the black market and hinder smoking cessation efforts.

    Jones criticized the WHO for its opposition to RRPs, stating that its stance is not supported by scientific evidence. He called for greater accountability and transparency in international regulatory discussions, advocating for public and parliamentary scrutiny of decisions made by the FCTC.

    Highlighting the importance of flavors in vaping products for adult smokers, Jones cited research showing that nontobacco flavors are popular across all age groups. He argued that banning these flavors would be counterproductive and could lead to increased smoking rates as consumers turn to unregulated alternatives.

    Jones also addressed the potential of heat-not-burn products and nicotine pouches, urging the government to reconsider its stance on these alternatives and commission further research into their benefits. He emphasized that public health policies should provide smokers with accurate information about all nicotine products to support informed decision-making.

    In conclusion, Jones called for a continued focus on tobacco harm reduction, advocating for evidence-based regulations that support smokers in their efforts to quit. He stressed the need for the U.K. to maintain its leadership in this area and to hold international organizations accountable for their policies and decisions.

    Ramsey S. Lewis, Charles and Marilyn Stuber distinguished professor of plant breeding at North Carolina State University, delivered a detailed keynote on the complexities and challenges of developing low-nicotine tobacco varieties. He highlighted the increasing interest in these due to potential regulatory mandates that could require more than a 35-fold reduction in nicotine levels in conventional cigarettes. He emphasized that nicotine accumulation in tobacco plants results from complex interactions between environmental and genetic factors and asserted that genetic modification is the only viable method to achieve the stringent targets suggested by regulatory authorities.

    Lewis outlined the significant difficulties in achieving lower nicotine levels without negatively impacting other critical aspects of tobacco cultivation. He noted that reducing nicotine content often leads to undesirable reductions in yield, increased production costs and severe effects on leaf quality and other chemical properties of the tobacco. He warned against underestimating the complexity of biochemical pathways in living organisms, explaining that modifications in one area can lead to unexpected consequences in another.

    Furthermore, Lewis enumerated the numerous obstacles facing the development of low-nicotine tobacco. These include the feasibility of such projects, the limited availability of suitable varieties, susceptibility to diseases and insects, lower yields and higher production costs. Additionally, he highlighted the challenge of global acceptance of gene-editing techniques and the potential impact this may have on exports. Lewis underscored the need for extensive research and development to overcome these barriers and meet future regulatory requirements effectively.

    Participants in the “Nicotine – An Agricultural Approach” panel provided a comprehensive overview of the agricultural challenges and considerations associated with nicotine regulation. The discussions emphasized the need for continued research and development, thoughtful regulatory approaches and the importance of supporting both farmers and consumers in navigating these changes.

    Moderator Miranda Kinney, senior vice president of global communications and sustainability at Pyxus International, began the panel by delving into the agricultural aspects behind the tobacco products on today’s shelves, likening their personalized production journey to that of food products in supermarkets. She highlighted the importance of tobacco leaf, noting that it is the essential ingredient in most nicotine products and plays a critical role in supporting consumer satisfaction.

    Kinney emphasized that the tobacco industry supports millions of jobs globally, from farmers and processors to manufacturers, exporters, distributors and retailers, thereby enhancing livelihoods and supporting the economic viability of many developing countries.

    Kinney guided the discussion toward the intricate journey of the tobacco leaf, from the speck of a seed to a substantial industry contributor. She explained that the genetics and breeding of the seed, agricultural production practices, environmental factors and regulatory landscapes all impact the industry today and shape its future. She highlighted recent scientific advancements in genetics, cultivation practices and mechanization, noting their significant impact on farmers, particularly in developing countries where tobacco for novel nicotine products is often grown.

    Addressing regulatory challenges, Kinney pointed out that regulations, such as those proposed by the U.S. Food and Drug Administration on menthol and low-nicotine mandates, present key concerns for the industry. She discussed how potential regulations, particularly from influential regions like the EU and the U.S., could set trends globally. Kinney emphasized the importance of industry collaboration to anticipate and adapt to potential changes, ensuring that all parts of the supply chain are considered. She concluded by stressing the need for collective industry expertise to navigate the future, underlining that the agricultural aspects of tobacco production are intricately tied to the overall industry.

    George Cassels-Smith, chief executive of Tobacco Technology Inc., addressed the potential complications of mixed-crop standards, where only some plants meet lower alkaloid levels. He questioned the practicality and extensive testing required to manage such standards, particularly for plants that do not meet the set criteria.

    Cassels-Smith noted that synthetic nicotine gained a foothold in the U.S. market due to the stringent regulations on tobacco plants, although the regulations on synthetic nicotine have since been tightened. He pointed out that vaping products predominantly use synthetic nicotine, highlighting a significant shift in the industry toward these alternatives.

    He underscored the need for clear and feasible regulatory frameworks that consider the practical implications for producers and the broader industry.

    Lewis opened his remarks by clarifying that his expertise lies in plant breeding rather than addiction or behavior. He highlighted the significant challenges associated with modifying the nicotine content in tobacco plants without causing negative effects on the plants themselves.

    Lewis pointed out that if a regulatory mandate for low-nicotine tobacco were imposed today, the industry would struggle to comply due to the limited availability of viable low-nicotine varieties, which currently number around five and are associated with lower yields.

    He emphasized the complexity of biochemical pathways and the unintended consequences that can arise from genetic modifications, underscoring the need for extensive research and development to meet potential regulatory requirements.

    Carlos Pulcinelli, global project manager at Alliance One International, elaborated on the critical role of alkaloids in plant metabolism, with nicotine being the most significant alkaloid in tobacco. He asserted that it is currently impossible to control or modulate nicotine expression through agronomic practices alone, necessitating substantial investment in research and development.

    Pulcinelli stressed the increasing regulatory pressures facing the industry and the importance of developing the right plant varieties that meet the needs of farmers, regulators and consumers. He also highlighted environmental challenges such as extreme weather, droughts and floods, which complicate efforts to reduce nicotine levels.

    Despite potential changes in product formulations, he argued that the importance of plant alkaloids would remain paramount, calling for a balanced approach to meet these diverse challenges.

    Lea Scott, senior vice president of agronomy and agricultural sustainability for Universal Leaf Tobacco Co., discussed various agronomic practices, such as topping, used to manage alkaloid levels in tobacco plants. He emphasized the economic significance of tobacco farming, which generates approximately $944 million in revenue for the U.S. annually.

    Scott raised concerns about whether low-nicotine mandates might inadvertently encourage the growth of illicit trade, which already accounts for around 11 percent of the global tobacco market. He highlighted the substantial improvements in technology and the development of disease-resistant, high-yielding plant varieties. However, Scott noted that the transition to RRPs, such as heat-not-burn tobacco, would impact farmers by requiring less raw tobacco.

    He questioned whether lower nicotine levels might lead to increased consumption if consumers use more product to achieve their desired effect. Scott stressed that any shift to lower nicotine tobacco must be gradual and carefully managed, given its profound impact on farmers and communities worldwide. He also pointed out the trend of growing tobacco specifically for nicotine extraction into liquid forms, underscoring the importance of supporting both consumers and farmers.

    David Newns, entrepreneur and investor, chairperson and co-founder of Plxsur, highlighted the transformative potential of RRPs in global health outcomes. He noted that RRPs have evolved from a virtually unknown category to one now embraced by mainstream populations. This shift presents a significant opportunity to improve health outcomes worldwide by reducing the risks associated with traditional smoking. Newns emphasized that innovation cycles have been instrumental in driving the growth of the RRP category, transitioning vaping from a niche product to a globally recognized tool for harm reduction.

    Newns acknowledged the challenges associated with disposable vaping products but highlighted their crucial role in helping a large number of smokers switch to safer alternatives. These products have made it easier for smokers to incorporate vaping into their daily routines, facilitating a widespread transition from combustible tobacco. He also pointed out the collaborative efforts between academics and creatives in the vaping industry, dedicated to the mission of harm reduction. He reaffirmed that there is no one-size-fits-all solution, as different consumers have varying needs.

    Focusing on these needs, Newns explained that the universal demand from RRPs is for “more”—more convenience, flexibility, flavor, nicotine and personalization. This desire for “more” drives the continuous innovation within the industry. Looking ahead to GTNF 2024 in Athens this September, Newns expressed his enthusiasm over participating in “The Big Pitch” panel, which will invite innovators to present new and exciting nicotine products to industry leaders, fostering dialogue and shaping the future of RRPs.

  • The Forgotten Frontier

    The Forgotten Frontier

    Photo: fontriel

    Is tobacco harm reduction reaching the Global South?

    By Pieter Vorster and Sudhanshu Patwardhan

    Eighty percent of the current users of risky tobacco products live in the “Global South,” the geopolitical clubbing of low-income and middle-income countries (LMICs) that includes not only Southern Hemisphere nations such as Fiji but also nations that are firmly in the Northern Hemisphere, geographically, like China, India, Russia and Bhutan, along with countries that straddle both segments, such as Uganda.

    A world free of smoked and smokeless forms of risky tobacco products such as cigarettes, bidis, gutkha, mishri, zarda and toombak can prevent a billion premature deaths this century. This can potentially reduce the social, economic and health inequity within and between countries, thus delivering on many U.N. Sustainable Development Goals and taking a step closer to the World Health Organization’s “health for all” ambition. Do manufacturers of tobacco products, as well as businesses delivering cessation products and services, have a role in this?

    Sudhanshu Patwardhan is a medical doctor, nicotine expert and health tech entrepreneur. Pieter Vorster is managing director of Idwala Research, a consultancy aiming to accelerate global tobacco transformation and harm reduction. Both have roots in the Global South and are motivated by the goal of reducing the harms from tobacco, as seen in the Global North. Below, they discuss the challenges and opportunities related to global health equity in a freewheeling dialogue, interchangeably playing the role of interviewer, respondent, expert and devil’s advocate.

    Background

    In June 2023, at the Global Forum on Nicotine in Warsaw, Sudhanshu Patwardhan convened and chaired a workshop of international experts representing diverse stakeholder groups—tobacco control, industry and management consulting. The session was titled “Tobacco Industry Transformation—Is It Really Reaching LMICs?” The panel and the audience, including Pieter Vorster, brought deep and wide expertise in public health, consumer advocacy, regulatory affairs, nicotine supply chains and capital markets. As the first anniversary of the session approaches, it is timely to discuss the developments that have occurred since and what needs to be done going forward to achieve a world free from risky tobacco products.

    Pieter Vorster: Sud, let us summarize the session before we leap forward into what has happened since and what is next. So, in the workshop, you brought up the role of a range of stakeholders in the ecosystem: regulators, industry, consumers and healthcare professionals, to name a few. What are the regulatory challenges in the Global South that significantly impact tobacco cessation and prevention of initiation?

    Sudhanshu Patwardhan: Pieter, smoked and smokeless forms of risky tobacco products are a leading cause of noncommunicable diseases (NCDs) globally and increasingly in the Global South. However, when it comes to tobacco control, there is a serious regulatory capacity gap in the Global South. Most of these countries are still developing locally relevant systems and policies that can best meet their populations’ needs for healthier, happier and longer lives. All these countries are going through a dramatic epidemiological shift—with NCDs overtaking infectious diseases as a leading cause of disease and death. Most of these countries are signatories to the WHO’s Framework Convention on Tobacco Control [FCTC], but the implementation of the FCTC articles is still very selective. For example, most emphasis is on taxation (a proven tool for reducing demand and increasing treasury earnings), advertising restrictions, and campaigns for public awareness and prevention of initiation. Although this is having an impact, progress has been slow. The principle of harm reduction, although explicitly stated as a component of tobacco control in Article 1(d) of the FCTC, has largely been ignored by the WHO to the extent that its guidance on tobacco policy favors a prohibitionist approach toward safer nicotine alternatives and that is being adopted by many countries in the Global South that look to the WHO for leadership on health policy.

    Vorster: Please explain how that is also a regulatory issue.

    Patwardhan: This came up during our workshop. The tobacco industry is innovating into “reduced-risk products” at a breakneck speed, catching up with product innovation from outside the industry (e.g., e-cigarettes) or launching products they have developed through years of R&D (e.g., nicotine pouches and heated-but-not-burned tobacco products). Their ability to launch these products is stymied by local prohibitions in many countries globally. If regulated strictly enough and marketed only to current tobacco users, these products have the potential to reduce tobacco-related harms significantly. Evidence from the U.K., Japan and Sweden is a case in point.

    In an interlinked issue, there is hardly any capacity built for tobacco cessation in the Global South. Most of the pharmaceutical industry or health tech entrepreneurs there are equally unenthused about innovation into tobacco cessation and the massive public health opportunity. They fail to recognize the financial dividend by serving the “base of the pyramid.” So, effectively, nearly a billion people in the Global South—current tobacco users—are consigned to struggle by themselves in their attempts to quit, and most fail.

     An important aspect of “demand reduction” in tobacco control, i.e., enabling access to appealing nicotine-replacement products that can enable and sustain cessation among current adult tobacco users, is therefore not available in most of the Global South.

    Vorster: So, bans on newer “safer” nicotine alternatives in many countries are causing a strange situation: Risky forms of tobacco are still available everywhere, legally, while reduced-risk products are not? One would have thought that the science underpinning the tobacco harm reduction principle is universal. If it is clearly understood by U.K. policymakers and enshrined in the U.S. Food and Drug Administration’s “modified-risk tobacco product” authorization, why is it not accepted in the Global South?

    Patwardhan: It is important to bear in mind that sound policymaking and regulations cannot be a simple copy-paste from the Global North. Yes, global good practices can be adapted—but there is no substitute for local science to ensure relevance and sustainability. Local research capacity not only helps build the scientific evidence base but also helps society interpret it objectively. That is currently missing in most of the Global South. A glaring example is from my recent attendance at the biannual global meeting of the Society for Research in Nicotine and Tobacco, held in Edinburgh. Out of the over 1,000 delegates there, in my estimation, less than 5 percent of those attending were working on the ground in tobacco cessation and harm reduction in the Global South. The fact that these conferences happen mainly in Europe and the USA also points to systemic bias in funding and research, all skewed to the affluent Western nations. Even conventional tobacco cessation treatments are hardly, if at all, studied and available in the Global South.

    Vorster: Do you mean nicotine-replacement therapy products (NRT)?

    Patwardhan: Yes, that’s a good example. NRT are on the model essential medicines list of the WHO for tobacco dependence treatment. They have also made it to the National Essential Medicines lists of member countries. But the reality on the ground is vastly different and quite frustrating. Little or no local research data on the use of NRT for tobacco dependence treatment exist in most of the Global South. NRT gums, patches and lozenges are much costlier than the tobacco products they are meant to replace during a quit attempt. They are either available at limited points of sale or not at all, and healthcare practitioners are not equipped to advise patients on using these products.

    Vorster: You often talk about nicotine misperceptions among healthcare professionals, and you led the first published research study on this topic in 2013. More recently, the Foundation for a Smoke-Free World-funded SERMO study of over 15,000 doctors from 11 countries also showed that of those interviewed, over 70 percent believed (wrongly) that nicotine in tobacco products causes cancer. How does that impact cessation?

    Patwardhan: From personal experience interacting with numerous frontline clinicians worldwide over the years, I can see how nicotine misperceptions influence their advice to tobacco-user patients. Smoked tobacco and most smokeless tobacco products are harmful due to a wide range of chemicals, including carcinogens, either produced during combustion or added during manufacturing. Nicotine is not a carcinogen; it is, however, the dependence-causing chemical in tobacco products for sure! The misperception about nicotine regarding cancer is a likely cause of hesitance among clinicians to recommend adequate NRT treatment for long enough, alongside behavioral counseling. Cravings for nicotine and withdrawal symptoms can last from weeks to months. Not supporting the quit attempt with adequate dosing of clean forms of nicotine (e.g., NRT) for long enough is very likely to lead to a failed quit attempt or relapse. Countries such as the U.K. have strong regulatory expertise in tobacco control and expertise in nicotine science and have therefore embraced a tobacco harm reduction indication for NRT—i.e., deemed it safer for smokers to consume NRT as long as necessary, for quitting smoking altogether and to prevent relapse.

    Vorster: You make the role of regulators in tobacco cessation loud and clear. What about the industry?

    Patwardhan: The industry is not a monolith. Nor is it just the tobacco industry we are talking about here. The nicotine supply chain has never been so exciting! A significant proportion of the world’s pharmaceutical-grade nicotine comes from companies extracting nicotine from tobacco in India. Many of those companies also supply the increasing demand for nicotine for e-cigarettes and nicotine pouches. Then there is synthetic nicotine, made to pharmaceutical standards, also poised to disrupt the supply chain and potentially free up thousands of hectares of arable land to address food security issues. Some of the large multinational tobacco companies have invested in medically licensed NRT, e.g., BAT and Philip Morris International, blurring the lines between tobacco and NRT companies, potentially expanding the choices available for enabling quit attempts among current tobacco users. However, given the history of the industry, any efforts by the tobacco industry to conduct tobacco cessation training among healthcare professionals would be viewed with suspicion and likely to evoke a reaction from those in public health. There is a clear role and an unmet need for independent organizations to take the lead on this in the interest of public health. Tobacco companies can better focus their resources on conducting locally relevant tobacco cessation and harm reduction research in the Global South. That could potentially better inform regulation and an understanding of harm reduction principles among key stakeholders.

    Now, this is where I get to ask you questions! Given your deep expertise in the tobacco industry transformation process, what do you make of the tobacco companies’ innovation and launches in the context of the Global South?

    Vorster: Although there have been valuable attempts to gauge overall industry transformation, notably the Tobacco Transformation Index, no independent research has been conducted that tracks transformation progress specifically in the Global South.

    Having said that, there have been encouraging, albeit nascent, trends here. During the early years of reduced-risk tobacco product (RRP) launches, multinational tobacco companies focused on countries such as the U.S., Japan, Korea and Europe. More recently, companies like BAT have launched nicotine pouches in Kenya, Pakistan and South Africa and PMI in the Philippines, Pakistan and South Africa. Furthermore, PMI sells heated-tobacco products in a considerable number of Global South markets, including Indonesia in select cities, while BAT has a significant geographical footprint there with vaping products.

    Apart from regulatory measures that prohibit the sale of RRPs in a substantial proportion of these countries, one of the most significant barriers to harm reduction is the cost of these products relative to cigarettes, which is a function of both low cigarette prices and excise tax and relatively high production costs for RRPs. For example, the PKR120 ($0.43) per can, at which BAT and PMI sell nicotine pouches in Pakistan to compete with low-end cigarette prices, is below current production costs of about $0.50 to $0.60 per can. For RRPs to make meaningful inroads in the Global South, it is imperative that costs are reduced significantly and the price differential with all forms of risky tobacco products available locally is decreased substantially. Within this context, it is significant that BAT (followed by PMI) chose to introduce nicotine pouches in Pakistan, which has the second-highest incidence of smokeless tobacco use in the world.

    Patwardhan: Where do large national tobacco companies come into this?

    Vorster: The transformation picture is markedly different beyond the listed multinational tobacco companies. Sadly, this is also where the majority of the world’s consumers of harmful tobacco products resides.

    There exists clear potential for conflicts of interest where state monopolies control the tobacco industry, but these potential conflicts exist well beyond state ownership of tobacco companies through the tax revenues earned from tobacco products. For countries with a significant reliance on tobacco tax revenues, the WHO’s prohibitionist stance on nicotine consumer products has helped justify the banning of less risky forms of tobacco and nicotine.

    In China, the government receives the equivalent of circa 10 percent of General Government Final Consumption Expenditure from tobacco taxes in addition to the substantial revenue it earns from its ownership of the CNTC [China National Tobacco Corp.]. It was, perhaps, no surprise that, in 2022, the burgeoning independent Chinese vape industry was brought under the purview of the State Tobacco Monopoly Administration, leading to its near collapse owing to significant regulatory restraints.

    Indonesia is the second-largest cigarette market in the world after China, and whilst the tobacco industry is privately owned, the government receives some 13 percent of General Government Final Consumption Expenditure from tobacco taxes. RRPs are not banned in Indonesia, but with average cigarette prices around $1.50 per pack, they are not competitive and will likely only appeal to high-end consumers.

    Patwardhan: From the looks of it, the odds are stacked against tobacco users in the Global South: knee-jerk regulation against safer nicotine products, a local versus multinational tobacco companies’ turf war, nicotine misperceptions among healthcare professionals and a lack of locally conducted scientific research in tobacco control and harm reduction. Conducting high-quality, independent research in tobacco control and harm reduction, which can be peer-reviewed and used to inform regulatory and clinical decisions, can change this situation for the better.

    Vorster: Furthermore, despite initiatives such as the Tobacco Transformation Index that assess the overall shift in the industry, a considerable gap persists in independent research focused on monitoring transformation progress specifically in the Global South.

    Patwardhan: Agreed. There is an urgent need for industry transformation, not just in products but also in organizational attitudes toward public health, research and social responsibility in the Global South. It is quite clear to me that the industry must prioritize public health outcomes alongside business interests. It was mentioned in our panel how crucial it is for companies to engage with communities transparently to foster an environment conducive to harm reduction. This includes investing in local communities, conducting local research to global standards and responsibly supporting educational campaigns that accurately inform adult consumers about the risks of consuming tobacco and the evidence-based aids available locally for quitting tobacco use.

    Conclusion

    Eliminating harm from tobacco products is a lofty social, public health, economic and political goal. It needs to be a global goal too. The rapid pace of innovation into safer nicotine alternatives for tobacco cessation is likely to be available and affordable only to the adult tobacco consumers in wealthier “Global North” nations in a well-regulated environment, and this threatens to worsen the inequity already imposed on current tobacco users of the Global South. The industries—not just tobacco but also pharmaceutical as well as new disruptive digital and health tech companies, have much to gain commercially by innovating in the Global South. There are nearly a billion current adult tobacco consumers there waiting for just that!

    Pieter Vorster is managing director of Idwala Research, a consultancy aiming to accelerate global tobacco transformation and harm reduction.
    Sudhanshu Patwardhan is a medical doctor, nicotine expert and health tech entrepreneur from India, based in the U.K. He works on projects around the world to reduce harm from tobacco, especially among the most disadvantaged tobacco user populations.
  • Not Lost Yet

    Not Lost Yet

    Photo: JTI Poland

    While struggling with rising cost and mounting regulations, Polish tobacco companies can cheer the retreat of the illicit market.

    By Vladislav Vorotnikov

    In the next few years, Poland may lose a part of its competitive edge as a regional tobacco superpower owing to controversial European Commission policy. This will happen unless common sense prevails or the government finds the courage to stand up to Brussels, according to market players.

    Poland is one of 12 countries in the EU that grows tobacco. For eight, including Poland, this is a strategic economic sector. Poland is also the largest exporter of tobacco products in the EU, with nearly 10 percent of the country’s agricultural and food exports, 80 percent of which goes to the EU market.

    The last few years have been rough for Polish tobacco growers, primarily owing to surging operating costs in Europe, according to Lukasz Szymanski, owner of Solidus Tobacco, a trading company.

    “Unfortunately, in recent years, we have observed a systematic shrinking of the tobacco-growing sector in Poland. This was caused by systematically rising energy and labor costs, which were the main obstacle for many growers,” Szymanski said.

    Szymanski, who has been in the tobacco business since 2015, selling mostly green tobacco and tobacco in the form of strips primarily to European customers, last year moved to expand activities and open an additional branch in the port of Trieste, Italy, eyeing markets outside the EU, specifically in the Middle East.

    Weak demand in the European market might be a key rationale for Polish tobacco businesses to seek opportunities overseas.

    “For many years, market tobacco purchase prices remained at the same level, which effectively discouraged many farmers from further cultivation,” Szymanski said, adding that since he stepped into the market, he saw a gradual decline in the sales volumes, which, he calculated, nearly halved between 2016 and 2022.

    In the coming years, the lives of Polish tobacco growers could become even more challenging. Market players are increasingly concerned about the fallout of the November summit of the World Health Organization in Panama. This summit, in the opinion of some Polish tobacco businesses, has been perceived as a public declaration of war on the industry.

    “We are afraid that the Polish tobacco industry will be killed by [the] Panama [summit]. The threat of unemployment hangs over us. We do not understand why employees of legitimate businesses should fall victim to international interference in Polish affairs,” said Marcin Klimczyk, chairman of the National Section of Tobacco Industry Workers.

    Polish leaf producction has steadily declined in recent years. (Photo: Solidus Tobacco)

    Bracing for Impact

    At the end of 2023, Polish businesses, united in their concerns, appealed to the government, seeking protection. Among other things, the National Chamber of Commerce, a prominent business union, has questioned the rationale behind participating in the WHO tobacco convention, voluntarily accepting constraints on tobacco business. The organization indicated that the countries not taking part in the initiative, specifically the United States and Great Britain, are more successful in fighting tobacco addiction.

    Accepting new rules will have a heavy impact, not only in Poland but also in the entire EU, players believe.

    “I am surprised that Europe is moving in this direction,” Marek Kowalski, chairman of the Federation of Polish Entrepreneurs, told Rzech Pospolita. “There will come a time when the EU will no longer be competitive on the tobacco market with countries outside it, which will willingly fill this gap.”

    Poland is the world’s largest manufacturer of nicotine sachets, noted Zbigniew Jankowski, a spokesperson from Swedish Match.

    “We are convinced that the implementation of the WHO recommendations by the EC after Panama may lead to a ban on their sale in Europe and, in fact, to the destruction of this fledgling market. Companies will go bankrupt; people will go out of business,” Jankowski said.

    On top of that, many people who have given up cigarettes in favor of less harmful alternative products, such as nicotine sachets, will be deprived of them if the WHO recommendations are implemented. This could have a significant impact on public health and the industry’s revenue.

    Polish tobacco companies are increasingly looking for opportunities overseas.

    Flourishing Industry

    In the long run, new regulations can undermine the investment attractiveness of the Polish tobacco industry, which secures roughly 8 percent of taxes for the national budget.

    In the past few years, the general mood in the Polish tobacco industry was predominantly positive.

    Cigarette volume sales declined by less than 1 percent in 2023 while the value grew due to increased prices, Euromonitor International, a think tank, calculated.

    “In 2022, the influx of refugees from Ukraine strongly revived cigarette sales, but the impact of this factor weakened in 2023. This factor also resulted in lower volume sales of fine-cut tobacco. Meanwhile, novelty nicotine and tobacco products, such as e-vapor products, heated-tobacco products and nicotine pouches, continued to show a significant increase in demand,” said Lina Sidorenke, an analyst with Euromonitor International.

    “Closed-system disposable devices emerged as the big winner with the strongest growth in 2023. Demand for cigars remained stable; however, high demand in Asian markets and the USA has led to fewer cigars being imported to Poland. Despite regular excise duty increases, Poland still stands out in the region for low prices of tobacco products,” Sidorenke said.

    Moreover, Poland has recently achieved drastic progress in fighting against illicit trade in the tobacco market.

    In recent years, the illegal sales of cigarettes in Poland have declined dramatically, Sidorenke claimed.

    “As of 2023, the gray market comprised less than 5 percent of all cigarette volume sales. Poland has demonstrated significant success in combating illicit trade, thanks to a united effort by the police, Border Guard and National [Revenue] Administration,” Sidorenke indicated, adding that in the past, a significant portion of contraband previously originated from Belarus and Ukraine, but the imposition of sanctions on Belarus and the war in Ukraine has led to stricter border controls, resulting in a significant decrease in illegal inflows to Poland.

    JTI Poland has invested heavily in reduced risk product manufacturing.

    Emerging Niches

    The positive developments encourage international giants to pump more money into their Polish operations, primarily eyeing the segment of heated-tobacco products.

    “While sales of traditional tobacco products in Poland are relatively stable, the heated-tobacco products category has been constantly growing in the last five years, accounting for about 11 percent of the entire nicotine market in the country today,” commented Adrian Jablonski, corporate affairs and communications director of Japan Tobacco International Poland.

    “In response to these evolving consumer trends, we introduced Ploom X—JTI’s third-generation heated-tobacco product—to the Polish market in September last year. Our heated-tobacco sticks [HTS] are produced at the state-of-the-art factory in Stary Gostkow, where we have already invested over $200 million in the reduced-risk products factory,” he added.

    Jablonski added that JTI plans to continue to develop the HTS category in Poland, though the company cannot reveal details for competitive reasons.

    However, the segment may also feel the sting of the tightening regulations in the foreseeable future.

    In February 2024, Polish Health Minister Izabela Leszczyna announced that the government was considering a ban on the sale of disposable electronic cigarettes, as reported by the local newspaper Business Insider.

    Leszczyna added that she would like to pursue the fastest possible legislative path to such a measure, given that as many as 64 percent of young people in Poland had “contact” with the product.

    “Single-use e-cigarettes currently dominate the e-vapor product market in Poland. This trend has surged over the past three years. If Poland were to follow the U.K.’s lead and implement a ban on disposable e-cigarettes, it could significantly impact the entire e-vapor market,” Sidorenke said.

    Sidorenke added that while some consumers may transition to other alternatives within the sector, a decline in overall e-vapor market demand is likely.

    Heated-tobacco products in Poland currently face fewer regulatory restrictions compared to combustible cigarettes, with lower taxation and continued availability of flavored products. Despite calls from the European Commission for Poland to adhere to EU regulations prohibiting flavored heated-tobacco products, they remain on sale as of April 2024.

    “However, it’s anticipated that new regulations will be implemented rather soon. It’s worth noting that the market has historically adapted to regulatory changes, as seen after the ban on flavors in traditional cigarettes. Thus, even with a potential flavor ban, the market is expected to adjust accordingly,” Sidorenke indicated.

    In the next five years, the tobacco and nicotine market is expected to advance toward the development of next-generation novelty products, partially at the expense of traditional cigarettes and smoking tobacco, Euromonitor International analysts forecast.

    A negative or uncertain forecast is anticipated for cigars, cigarillos, snuff and pipe tobacco. Beginning May 20, 2024, all tobacco products in Poland will be subject to the track-and-trace system. Previously, the EU track-and-trace system only covered cigarettes and fine-cut tobacco. However, as of May 2024, cigars, cigarillos, snuff and pipe tobacco will also fall under this system.

    “This expansion will impose additional burdens on manufacturers and retailers due to the costs, complexity and compliance requirements. In anticipation, some distributors have already indicated plans to withdraw these items from their offerings after the system comes into effect,” Sidorenke said.

  • Diluted Diligence

    Diluted Diligence

    Photo: kittyfly

    Even in its watered-down version, the recently approved EU supply chain law will impact tobacco companies.

    By Stefanie Rossel

    Good things come to those who wait, but sometimes they come only as a compromise. On March 15, the European Council finally approved the EU Corporate Sustainability Due Diligence Directive (CSDDD), which was scheduled to be adopted by the European Parliament on April 24, thereby passing it into EU law.

    Commonly referred to as the EU Supply Chain Law, this directive, which was first proposed in February 2022, is meant to establish a common baseline across the trade bloc’s member states. As binding EU law, it requires companies to identify, prevent and mitigate adverse impacts on human rights and the environment throughout their supply chains. If implemented as anticipated, the CSDDD would impose substantial responsibilities on companies, including those operating in the tobacco business.

    The version the European Council agreed upon this March, though, is a significantly watered-down version of the original draft, reducing the number of affected companies in Europe by 70 percent and allowing for several exceptions. The amendments include:

    • Reduced scope of application: Instead of companies with 500 employees and a turnover of €150 million ($162 million) as initially envisaged, the directive in its current form would be applicable to enterprises with 1,000 employees and a turnover of at least €450 million.
    • Deletion of the high-risk approach: The plan to gradually integrate companies that don’t meet the criteria of the scope of application but operate in a high-risk sector has been eliminated from the draft law.
    • Introduction of a staggered implementation of the directive: Depending on their size and turnover, companies now have between three years and five years to make their firms compliant with the CSDDD.
    • Civil liability: The liability clause included in the CSDDD will be marginally adjusted to allow member states more flexibility in transposing the directive into national law. Generally speaking, however, the CSDDD will still enable injured parties to sue European companies for breaches alleged to have occurred across their supply chains.

    “The overall EU objectives of addressing global human rights issues, environmental concerns and, more recently, climate change can certainly not be criticized,” says Abrie du Plessis, an associate at the South African Trade Law Center in Cape Town and a close observer of EU regulation who during previous work in the tobacco industry followed the development of the World Health Organization Framework Convention on Tobacco Control (FCTC) and the development of the 2014 EU Tobacco Products Directive.

    “As always, however, real challenges and obstacles can emerge from the details, and it seems fair to say that major companies operating in the EU already face what may be described as a flood of legislative initiatives on the issues now also covered by the CSDDD,” says du Plessis. “The task which lies ahead, which is to comply with a range of general, specific and sometimes overlapping legislative initiatives, is formidable.”

    Building on Other Laws

    Even in its weakened form, the CSDDD will likely affect all the major tobacco manufacturers operating in the EU in some way due to their turnover and number of employees. Du Plessis thinks that they are well placed even though, as always, the specifics of the tobacco industry must be considered.

    The CSDDD comes on the heels of the EU Corporate Sustainability Reporting Directive (CSRD), which was adopted in December 2022 and entered into force on Jan. 5, 2023. This directive requires all large companies and all listed companies, except listed micro-enterprises, to disclose information on what they see as the risks and opportunities arising from social and environmental issues and on the impact of their activities on people and the environment. This is supposed to help investors, civil society organizations, consumers and other stakeholders to evaluate the sustainability performance of companies, as part of the European Green Deal, which is intended to transform the EU into a climate-neutral regional integration organization by 2050.

    “These two directives are closely related, and some of the steps already being taken by companies to ensure CSRD compliance are also required by the CSDDD,” says du Plessis. “Some progress toward CSDDD compliance is therefore already being made.”

    In some instances, he adds, there are also other EU laws that already address—or will in due course address—specific environmental issues. “Relevant examples are those on the sustainable use of plant protection agents, on single-use plastics and on deforestation,” says du Plessis. “Such EU legislation can either be directly applicable to tobacco products or can provide useful guidance even if it is not directly applicable. Already complying with measures clearly prescribed in other EU legislation may reduce the CSDDD compliance burden.”

    One challenge for manufacturers is that they may be held liable for circumstances that are outside their immediate control. (Photo: Taco Tuinstra)

    News Tasks

    Nevertheless, the upcoming directive will bring about a range of challenges for tobacco companies. Among other things, manufacturers may be held liable for circumstances that are out of their immediate control and which, experts argue, are probably better handled by policymakers in the respective countries covered by the supply chain in question.

    “The CSDDD requires companies to identify potential and real adverse environmental and human rights impacts arising from their own operations, subsidiaries and business relationships,” says du Plessis. “They must take measures to prevent or mitigate any potential impacts they identify as well as end or minimize any real impacts. Failure to comply and resultant may lead to liability and financial penalties.

    “An example could be the issue of child labor, and it has become an established view that the purchasers of commodities do in fact have some ability to influence the behavior of their suppliers. The tobacco industry has certainly done a lot of work in this area, but the question going forward will of course be whether this meets expectations or will need to be revisited. It is quite correct to observe that national policymakers also have a key role to play in this debate.”

    According to du Plessis, the expectation that manufacturers assume responsibility for the behavior of their suppliers has become a fact of life. “The basis for this approach is the real or perceived control which manufacturers exercise over players in their supply chains,” he says. “There are of course debates to be had as to what is in fact possible and workable, and the issues will hopefully be addressed through having constructive debates about CSDDD during its transposition and implementation phases.”

    “Some corporate social responsibility activities for which tobacco companies were often criticized in the past are now actually required by law.”

    Abrie du Plessis, associate, South African Trade Law Center

    Isn’t It Ironic?

    The CSDDD will also require companies to adopt a transition plan. Under the new law, companies will be required to adopt transition plans for climate change mitigation and ensure that their business model and strategy are compatible with the transition to a sustainable economy. These transition plans should be reviewed every 12 months and describe in detail the progress the company has made toward achieving its targets.

    For the tobacco industry, this represents a complicated part of the curing and deforestation debate, according to du Plessis. “The interesting angle here is that burning of wood biomass is generally regarded as carbon neutral and in many instances as sustainable.”

    Du Plessis says there are more bits of irony in the EU laws prioritizing sustainability. “The first is that some corporate social responsibility activities for which tobacco companies were often criticized in the past are now actually required by law,” he points out. “The second is the false narrative that Article 5.3 of the FCTC should apply to regulatory processes such as these. Neither the text of the FCTC nor that of its nonbinding guidelines support this view, and both the CSRD and the CSDDD make interaction with the industry involved a necessity rather than an option.”

    “Leading cigarette companies have a long history of proactively addressing many of the issues potentially covered by the CSDDD on a voluntary basis,” says du Plessis. “Participating in both the CSRD and the CSDDD processes will certainly put what they have achieved so far to the test. If done properly, CSRD and CSDDD can certainly contribute to progress in the areas identified, but given significant legal uncertainties, the preferred point of departure should be constructive dialogue rather than penalties and sanctions.”

    Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.
  • The Great Scramble

    The Great Scramble

    Buyers have been paying record prices to secure their shares of Brazil’s smaller-than-expected tobacco crop.

    By Taco Tuinstra

    On March 21, a ferocious storm tore through Brazil’s southernmost state, Rio Grande do Sul. The wind flattened numerous outdoor pavilions at the Expoagro exhibition in Rio Pardo, forcing its organizer, tobacco growers’ association Afubra, to close the event for a day and repair the damaged stands. In a more welcome development, the tempest brought relief from the heat wave that had been making life tough for those toiling in the region’s numerous fields and leaf processing facilities.

    But while Expoagro reopened to large crowds and the temperature dropped to more tolerable levels in the wake of the storm, other pressures on the industry continued unabated throughout the selling season. Alliance One Brazil Leaf Production Director Samuel Streck, who has worked in the business for two decades, described this year’s crop as the most challenging in his career, and his view was echoed by many other industry veterans throughout the Brazilian tobacco sector during Tobacco Reporter’s visit to the region in March.

    A significantly smaller-than-expected crop, acute labor shortages and record-high prices, along with heightened scrutiny of tobacco farming in the wake of the 10th Conference of the Parties (COP10) to the Framework Convention on Tobacco Control (FCTC), have kept the Brazilian leaf sector on its toes this year.

    Having been forced to temporarily cease operations due to storm, Afubra’s Expoagro reopened to large crowds. (Photos and videos: Taco Tuinstra)

    Low Yields, High Quality

    It wasn’t supposed to be that way. When planting for the 2023-2024 crop started in May last year, the industry predicted a volume increase of about 10 percent over the previous season, when the country’s growers harvested some 605.7 million kg of all tobacco types, according to Afubra.

    At first, the weather conditions appeared to validate that assessment, but then El Nino hit. The recurring weather phenomenon, which typically boosts precipitation in South America, had been anticipated but turned out much more intense than normal. From mid-July until the end of November, El Nino dumped unprecedented volumes of rain on southern Brazil, leading to flooding in lower lying areas. Accompanied by many sunless days, the wet conditions depressed yields not only in Rio Grande do Sul but also in Santa Catarina and Parana, the three southern states that together account for 98 percent of Brazil’s tobacco production. (The remaining volumes grow primarily in Bahia and are used to make cigars.)

    Crop

    Hectares planted

    Production (million kg)

    Leaf export earnings

    2023

    261,740

    605.7

    $2.66 billion

    2022

    246,590

    560.18

    $2.24 billion

    2021

    273,356

    628.49

    $1.31 billion

    2020

    290,397

    633.02

    $1.47 billion

    2019

    297,310

    664.36

    $1.99 billion

    2018

    297,460

    685.98

    $1.85 billion

    2017

    298,530

    705.93

    $1.96 billion

    2016

    271,070

    525.22

    $2.01 billion

    2015

    308,260

    697.65

    $2.06 billion

    2014

    323,700

    731.39

    $2.35 billion

    2013

    313,575

    712.75

    $3.09 billion

    Sources: Afubra/SindiTabaco

    Instead of a 10 percent boost, the industry was now looking at a 20 percent drop in volume from 2023. By late March, Afubra was expecting about 470 million kg of flue-cured Virginia (FCV) and roughly 40 million kg of burley.

    But even as the excessive rainfall slashed yields, it worked wonders for leaf quality. Brazil’s 2024 crop boasts good color, uniformity and smoking properties, according to buyers. High oil levels give this year’s leaf a better visual appearance than in 2023. What in the previous year was predominantly light orange to orange is this year orange to deep orange, observed Kohltrade in a recent crop report. “It’s perfect, in my opinion,” said Kohltrade Account Executive Simone Velasques.

    And it’s not just looks that set this crop apart; the tobacco smokes exceptionally well, according to Eduardo Renner, president and CEO of CTA-Continental. “That’s also the feedback we are getting from customers,” he said. On the flipside, the rain also suppressed nicotine levels in this year’s tobacco. According to Jay Barker of YTL, the excess rainfall has resulted in below-average chemistries across the board. Because the wet season followed three consecutive dry ones, the gap in nicotine levels between the current crop and the previous one is greater than normal, which may challenge some customers in creating their desired blends.

    Andie Spies of Hail and Cotton (left), and Eduardo Renner at CTA’s Venancio Aires headquarters

    Chasing Tobacco

    The combination of low volume and high quality, along with a persisting post-Covid-19 tobacco shortage at the global level, sparked a scramble among tobacco companies in Brazil to secure their requirements. As a producer of sought-after flavor tobacco, Brazil has only two true competitors on the world market—Zimbabwe and the United States. Zimbabwe, where El Nino brought drought instead of rain, is also looking at a smaller crop this year (albeit from a record volume in 2023), according to that country’s Tobacco Industry and Marketing Board. United States FCV production, meanwhile, has been stable for three years at just below 140 million kg, TMA figures suggest.

    The shortage has been aggravated by the fact that last year some customers didn’t buy everything they needed because they were expecting cheaper tobacco this year. Coming out of the pandemic, many customers adopted a wait-and-see approach, carefully managing their stocks to avoid buying at high prices. Now, with inventories running out, those who didn’t buy last year had to buy this year.

    According to local traders, Brazil’s leading tobacco buyers alone needed more leaf than the entire volume that was expected to come to the country’s market in 2024. Throughout the season, the vertically integrated companies—BAT, Philip Morris International, Japan Tobacco International and China Tobacco—were buying far above list prices, paying top rates for all grades and leaving independent traders with no choice but to follow their lead.

    Simone Velasquez (center)

    The result has been an unprecedented escalation of leaf prices and an acceleration of deliveries. In mid-March, farmers were receiving up to $5.50 per kilogram of green tobacco, according to Kohltrade. For processed leaf, customers were paying up to $9.50 for grades that cost perhaps $5 only three years ago. “Prices are up, up, up,” observed Afubra President Marcilio Drescher.

    Daison A. Kohl, who grows 2.7 hectares of tobacco in Vale do Sol, said he has never in his time on the farm witnessed such high prices and such fierce competition. Unlike many of his neighbors, Kohl contracts only with one buyer. Yet throughout the buying season, his phone rang nearly daily with representatives from other companies asking him to sell his leaf to them instead.

    Kohl had to disappoint them all. “It doesn’t matter how much they offer; the tobacco is just not there,” he said. Merchants have been telling their customers a similar story. Whereas in a more typical year, they may exaggerate and say, “there is no tobacco” as a price negotiation tactic, this season it is simply a statement of fact.

    The scramble for tobacco has also greatly accelerated the purchasing process, leaving some receiving stations struggling to keep up with the influx of leaf. At the time of Tobacco Reporter’s visit, leaf merchants were expecting farmers to run out of tobacco by the end of April—two months earlier than in 2023. “Customers who come late to Brazil may not find what they are looking for,” warned Velasques.

    Leaf tobacco exports have earned Brazil an average of more than $2 billion annually over the past decade.

    Labor Scarcity

    For the growers, the 2024 marketing season has been a mixed bag. Even with record per-kilo prices, the additional income may not make up for the reduced weight that they are bringing to market, according to Afubra. Kohl, who suffered a 26 percent drop in yield from last year, said that as long as the companies continue paying above list prices, his operation will remain profitable this year. “But if they resort to paying list prices, it will be a problem,” he said.

    While the cost of inputs such as fertilizer have been coming down from their Covid-19-induced and Ukraine war-induced spikes, a long-running shortage of labor has worsened in recent years, impacting both farmers and tobacco factories. But whereas tobacco buyers can mechanize operations such as rack loading and stripping, farmers have fewer options. With an average property size of 10.5 ha and an average area devoted to tobacco of only 3.29 ha, according to Afubra, the typical tobacco farm in southern Brazil is simply too small to justify the investment in equipment. What’s more, many of the tobacco growing activities lend themselves poorly to mechanization. There are no machines for delicate tasks such as sucker control and topping, for example.

    Meanwhile, aware of their growing scarcity, farmhands have started driving harder bargains. In Vale do Sol, they have organized themselves in collectives, forcing farmers to negotiate with groups instead of individuals, according to Kohl. To guarantee a group’s labor throughout the growing season, he must pay a premium on top of the already inflated salaries.

    Determined to control their cost of production, Kohl and his wife, Solange, carry out many of the tobacco farm activities, including land preparation, themselves. They hire labor for the first, second and third reapings, when the leaves are still thin and easily damaged and speed is of the essence. “If we don’t harvest quickly during that time, we will lose quality,” said Kohl. From the fourth reaping onward, the tobacco is thicker and less fragile, allowing the Kohls to harvest by themselves and save money on labor.

    Their workload has been lightened a bit by a recent switch from bundles to loose leaf. In the past, growers in Brazil would classify their tobacco according to quality and color and then tie the leaf into bundles—a laborious process that could take up to two months. As demand increased, some buyers told farmers to skip this step and deliver the tobacco in loose form instead. The practice spread rapidly and has now been adopted by all merchants. After drying the tobacco, the farmer can take his tobacco directly from the barn to the bale and put it on a truck, not only saving time and labor but also greatly accelerating the speed of delivery.

    While some buyers at first worried about how the new practice would impact processing, those concerns turned out to be manageable. “Loose leaf is not necessarily the best way to receive tobacco in terms of the feeding table and the presentation of each grade, but we quickly realized it’s possible,” said Streck. According to Renner, the process remains the same. “You can still tip and thresh the leaf because it is straight laid.”

    Farmer Succession

    The Kohls are happy with the change to loose leaf, as it allows them to focus on other farm activities. As they work their fields, they are occasionally joined by their oldest son of 34, who has no interest in farming but feels a duty to help on some evenings after he’s done with his day job. Their middle son (25) by contrast “does not even want to see the tobacco,” according to Kohl, while their youngest (8) is too little to work on the farm. (Brazilian law requires tobacco workers to be at least 18 years of age, and following intense industry-led awareness campaigns, the country’s sector today is considered a role model in in eradicating child labor.)

    The Kohls’ family dynamics hint at another challenge facing Brazil’s tobacco business: farmer succession. Like their counterparts around the world, many rural youngsters in Brazil aspire to work in the city, which has led to an exodus of skills and talent from the countryside. “Keiner will die Finger mehr dreckig machen”—nobody wants to soil their fingers anymore—observes Solange, who, like many people in southern Brazil, is more conversant in German than English as a foreign language.

    A 2023 survey conducted by the Federal University of Rio Grande do Sul at the request of the Interstate Tobacco Industry Union (SindiTabaco), revealed that with an average monthly income of BRL11,755.30 ($2,234.75), tobacco farming families in southern Brazil are relatively well off, earning considerably more than the average Brazilian family. The Kohls, for example, live in a spacious, well-built home equipped with plenty of conveniences and some luxuries, including a small swimming pool. Within agriculture, too, the golden leaf continues to generate the best returns, according to industry sources, contradicting the narrative pushed by certain nongovernmental organizations that tobacco leaves growers in poverty.

    Nadia Fengler Solf

    But while the earnings from tobacco farming exceed those of other crops, the golden leaf is also more demanding. Unlike some other agricultural products, the farmer cannot just plant it and watch it grow. A good tobacco farmer, notes Kohl, must constantly keep an eye on the plants. “The weather can change things very quickly,” he said. “If rain comes, it puts the leaves on the plants and—boom—they become big overnight. And if you don’t go in and take the flowers off and the wind comes, it can topple the plants.”

    With no one lined up to take over the farm, the Kohls’ tobacco volumes will disappear from Afubra’s production statistics after they retire. “We have another 10 years, and then we’ll be gone,” said Kohl. Unfortunately for tobacco buyers, their situation is not exceptional. According to the University of Rio Grande do Sul study, 27 percent of the growers in southern Brazil have no succession plan.

    Acutely aware of the demographic drain, the tobacco industry has been looking for ways to keep young adults in the countryside. Originally set up by SindiTabaco and its associate companies to help combat child labor in rural Brazil, the Growing Up Right Institute (also see “Alternatives for Adolescents,” Tobacco Reporter, April 2021) now also runs programs educating young people on the verge of adulthood about the opportunities on the farm. By teaching youngsters how to optimize farm operations through technology and professional management, the institute hopes to convince them that they can live good lives in the countryside.

    According to program manager Nadia Fengler Solf, the initiative has had some success. Upon graduation from the program, she said, many students have a completely new perspective on the possibilities in the countryside. Some decide to develop their family properties, investing in new technologies and diversifying their business, while others elect to pursue degrees in agriculture.

    Solagne Kohl (left) and Daison A. Kohl grow 2.7 hectares of tobacco near their home in Vale do Sol. According to a study commissioned by SindiTabaco, tobacco growers are considerably better off financially than the average Brazilian.

    COP Fallout

    But even as the industry is working to keep farmers interested in tobacco, others are campaigning to steer them away. At COP10 in Panama, delegates vowed to step up action on Articles 17 and 18 of the treaty, which call for the promotion of economic alternatives for tobacco workers and the protection of the environment and health of tobacco workers, respectively. According to a speaker at this year’s Americas Regional meeting of International Tobacco Growers’ Association in Santa Cruz do Sol, the Panama COP could be the first to have a direct impact on the farm.

    SindiTabaco President Iro Schunke dismisses the talk about alternative crops in Southern Brazil as unrealistic. “If we had another crop that generates the same income, farmers would have switched long ago on their own accord,” he said. Part of the problem, he explains, is the small average size of farm properties. “To replace the money from one hectare of tobacco, you need to grow 7 hectares of soybeans or 10 hectares of maize.” The pressure for diversification, meanwhile, is unnecessary, according to Schunke. “Tobacco farmers in Brazil are diversified already,” he said. While generating between 60 percent and 70 percent of the average grower’s income, tobacco claims only 20 percent of their property, according to SindiTabaco. Part of the money earned from tobacco is used to plant supplemental crops.

    “If we had another crop that generates the same Income, farmers would have swItched long ago on theIr own accord.”

    Iro Schunke, president, SindiTabaco

    Brazil was one of the most vocal proponents of stricter tobacco controls at COP10, a position that Schunke considers odd, given that leaf tobacco accounts for 11 percent of Rio Grande do Sul’s exports, employs more than half a million farmworkers and earned Brazil an average of more than $2 billion annually through exports over the past 10 years (see chart). Schunke attributes the government’s tough stand to pressure from nongovernmental organizations and the exclusion of tobacco stakeholders from health policy debates along with an ideological aversion to capitalism.

    Some suspect the government’s position is driven partially by ignorance, with bureaucrats in faraway Brasilia unaware of how much rural communities in the south of the country depend on the golden leaf. “Although hostility against tobacco from agencies all over the globe is the new status quo and the path of least resistance, the fact is, the economic impact to the communities where tobacco is prevalent is very significant,” says Barker.

    Santa Cruz do Sul Mayor Helena Hermany believes that Brazil’s national health surveillance agency, Anvisa, grossly underestimates and misrepresents the industry’s economic significance. More than 50 percent of the city’s revenue comes from tobacco, she told participants in the ITGA Americas meeting. “If tobacco does well, we all do well,” she said.

    If tobacco does well, we all do well.

    Helena Hermany, mayor of Santa Cruz do Sul, Rio Grande do Sul, Brazil

    It terms of sustainability, the tobacco industry is also performing much better than it is given credit for. “We are doing quite well in terms of soil protection, reforestation and the prevention of child labor,” said Drescher. For example, Brazilian farmers are self-sufficient in curing energy, sourcing wood from dedicated plantations rather than indigenous trees.

    According to Renner, sustainability is already an integrated part of everything the tobacco industry does. “Whatever we supply must cover these three capital letters,” he said, referring to the environmental, social and governance considerations that the abbreviation stands for. “What we do for our people, our clients, in our operations and in the communities we work with … our suppliers need to do for us.”

    As they prepare for next season in the wake of this year’s short crop, industry stakeholders are keen to avoid a wild swing in the other direction. Emboldened by the high prices and keen to recover their lost volumes, many growers are likely to increase their plantings for the 2024–2025 season. Kohl, by contrast, is cautious, worrying that a surplus next year will depress prices, and he plans to plant the same hectarage as last year.

    Others predict that the era of cheap Brazilian tobacco is over, not only due to demand-and-supply factors but also as a result of the considerable investments the local industry has made in sustainability. These investments should serve Brazil well as it moves into the new era, giving the country a competitive advantage against origins with less robust practices. At the same time, leaf merchants insist that the effort should be supported throughout the supply chain. ESG initiatives, after all, come at a cost that should be reflected in leaf prices. “It must be sustainable for all parties,” insisted Renner.

    Taco Tuinstra is Tobacco Reporter’s editorial director.Based in Raleigh, North Carolina, USA, he coordinates the work of staff writers and contributors.On his watch, Tobacco Reporter has won several awards for editorial excellence.Since joining the magazine in 1997, Taco has visited more than 75 countries to meet industry representatives in their markets and to report tobacco news firsthand.
  • A Perfect Storm

    A Perfect Storm

    Image: StockImageFactory

    How India came to deny consumers legal access to safer ways of consuming nicotine.

    By Samrat Chowdhery

    India’s ban on commercialization of electronic nicotine-delivery systems (ENDS) in 2019 was the blunt political end to a meandering administrative and legal process that began after the World Health Organization Framework Convention on Tobacco Control (FCTC) stated of ENDS in a report presented at its sixth general body meeting held in Moscow in 2014: “while medicinal use of nicotine is a public health option under the treaty, recreational use is not.”

    This early denial of harm reduction principles and mistaking product evolution and substitution for market expansion by the tobacco industry led many developing nations to begin formulating policies to ban e-cigarettes even as they were undergoing rapid development by small-scale Chinese producers—becoming safer, affordable and more effective in helping smokers switch.

    In India, the then Union health minister, Harsh Vardhan, who was well-steeped in the WHO mindset through his earlier work in establishing smoke-free public spaces policies in the 1990s as a state health minister, formed committees soon after the FCTC meeting to evaluate the impact of e-cigarettes. Staffed with experts from the same WHO-linked tobacco control ecosystem, the committees recommended a complete ban. Notably, another panel formed by the commerce ministry to study ENDS favored the regulatory approach but was overlooked.

    In an unexpected twist, the health minister was thereafter reshuffled to another ministry in late 2014, and the issue remained on the backburner until 2019 under the incumbent, although a slow-paced administrative and legal battle continued. The health ministry, through various regulatory bodies, tried to outlaw e-cigarettes, first by claiming they contain nicotine, which requires these products to gain medical approval, and thereafter by stating nicotine is governed by the Poisons Act, which forbids its sale as a consumer product. Both claims were shot down by courts that consistently indicated favor toward the regulatory pathway.

    This deadlock continued until Vardhan was reappointed health minister when his party swept back to power in mid-2019 with an absolute majority. Strengthening his hand was a perfect storm. A major push to ban vaping was being led by tobacco control nonprofits linked to funding from Bloomberg Philanthropies. Among them were The Union, the Campaign for Tobacco-Free Kids (CTFK) and Vital Strategies, which had been lobbying state governments to ban e-cigarettes. With the central government now on board, the wave became a tsunami, and soon, over 15 Indian states had declared a ban on vapor products.

    An underlying economic factor could also be that U.S. e-cigarette maker Juul, which had captured 70 percent of U.S. market share in under two years, announced its entry into India earlier that year, spooking the Indian tobacco industry, which until then had made little effort to develop vapor products, perhaps because the regulatory cloud cast on them since 2014 made long-term investment a risky proposition. Data revealed recently through a Supreme Court directive shows that India’s dominant tobacco company, ITC, donated upward of $11 million to the ruling dispensation a few months before the vape ban. However, it is unclear if this was to influence the ban, to favor or oppose it, or if it was part of election-time funding corporations often provide.

    Nevertheless, the insistence by Juul, which publicly led the pro-vaping side, on relying on foreign experts who did not well understand the complex and opaque Indian tobacco ecosystem; lack of homegrown research and tobacco cessation researchers who could have countered the anti-vaping narrative from the local network developed by Bloomberg-funded nonprofits; as well as the absence of the local tobacco industry from the debate were all contributing factors.

    What followed in rapid succession was to counter the opposition from courts by first banning research into e-cigarettes, followed by a “white paper” by the country’s top government-controlled research body, which cherry-picked research to make a case for a complete ban. This became the basis for an executive order prohibiting the sale of e-cigarettes and heated-tobacco devices, which, breaking from tradition, was announced by the finance minister. Stocks of Indian tobacco companies spiked after the news.

    The bill was debated in Parliament a few months later, where after a lengthy but low-quality debate as many politicians admitted they had not seen these devices and despite allegations of favoring the local tobacco industry and over 60 specific objections to the law, it was passed by brute majority. Vardhan was honored by the WHO with its top award for implementing the e-cigarette ban while The Union and the CTFK congratulated the Indian government along with claiming credit for the legislation. It was win-win for all, those selling tobacco and the ones opposing them, except the over 100 million smokers who had been denied legal access to safer ways of consuming nicotine, as well as the independent e-cigarette vendors, most of whom moved shop to Dubai when a Juul-led court challenge to the ban failed to bring relief.

    The Fallout

    After a year or two of realignment, which saw the vapor market change hands from rule-conscious vendors to black market operators who added e-cigarettes to their portfolio along with smuggled cigarettes (which constitute over a quarter of the market), mobile phones, gold and other prohibited or tax-evaded goods, the full scale of untended consequences some parliamentarians, policymakers and international experts had warned about started becoming apparent.

    The first was a product shift from mod-based devices to much cheaper disposables, which had lower barriers to entry and could be stocked by streetside vendors who have become accustomed to and adept at violating tobacco control laws such as the bar on selling loose cigarette sticks and the ban on gutka and pan masala. It did not take long for these substandard and untested, though affordable, single-use devices from becoming available in small towns across the country, growing the illicit vape market into an industry worth billions as smokers voted for their health by trying to switch while teens had a lot freer and cheaper access to them, the key rationale for the ban. The constituents that suffered were older and women smokers, for whom risk reduction could be most beneficial but who are least likely to engage with the black market. Many of them who had switched went back to smoking.

    A public health opportunity to convert over 100 million smokers and save lives with minimal stress on state resources while earning tax revenue and creating jobs, especially when unemployment rates are soaring, was lost and replaced by increased criminality, lost revenue, heightened risk for adult switchers as these products have not undergone quality checks, and easier access for teens and unintended users.

    The ban led to a short-term windfall for the local cigarette industry with most companies witnessing steady rise in valuations—ITC’s market cap recently overtook BAT’s—especially with the additional sop of the government not raising taxes on cigarettes and other tobacco products for three consecutive years. Yet, despite these remarkable industry concessions for a country hailed as the leader in tobacco control among developing nations, the picture is beginning to look less rosy by the day for local tobacco companies as these switchers are their lost customers who, given the high quit rates for smokers who try vaping, will likely never be back nor will those who are being introduced to recreational nicotine through e-cigarettes as there is little empirical evidence for the gateway theory.

    Failure to preempt shifting consumer behavior and the ensuing black market explosion, that too in a competing future category in which they are now prohibited from participating, could have significant implications for the Indian cigarette industry as no amount of protections and launching sticks in new flavors, which is partly responsible for sustaining cigarette sales, can compete with the users’ desire to safeguard their health and consume nicotine in less harmful ways.

    The Challenges Ahead

    Despite the central government’s ban on e-cigarette research and the media gag on publishing anything pro-vaping, despite the ban on carrying vapes through flights even though their use is not prohibited and despite Bloomberg Philanthropies pumping in a large tranche of funds for anti-vaping efforts, it is hard to miss the rapid transformation taking place in Indian towns and cities as smokers switch en masse to vapor devices.

    An additional pain point for the legacy industry could be the South African experience of the difficulty in shaking off the black market once it takes hold. Even if vaping was legalized in the near term, the legitimate taxed products will find it hard to compete with the cheaper illicit ones, more so when the consumers have been introduced to vaping through the black market.

    The challenge also lies in re-educating the medical fraternity on nicotine—eight of 10 doctors in India believe nicotine causes cancer—such that they understand the role risk reduction can play in reducing tobacco-related mortality and morbidity and sign on to help people struggling to quit toxic forms of nicotine use, or those who do not want to, lower risks by switching to much less harmful alternatives. This will be a tough barrier to cross because high nicotine illiteracy has led to proposals to overturn even the 2014 Moscow statement by restricting access to medical nicotine by making nicotine-replacement therapy (gums and patches) available only through prescription.   

    But it is never too late to course correct, and there appears to be some signaling from the ruling dispensation, which, if opinion polls hold, is set to return to power in the ongoing national elections (the opposition already favors regulation over a ban). The home ministry recently restricted the funding of the CTFK, a significant anti-vaping voice in the country, along with its key local partner while pro-government media is beginning to publish in favor of tobacco harm reduction again. It must not be hard to see the health and economic rationale for ending the ban on safer nicotine alternatives when it is not working anyway.

    Samrat Chowdhery is a journalist and tobacco harm reduction expert based in India.