Category: Featured

  • Campaign Launched Against Menthol Ban

    Campaign Launched Against Menthol Ban

    Photo: Karen Roach

    A conservative advocacy group has launched a campaign opposing a proposed ban on menthol cigarettes in the United States, reports Fox News.

    In its campaign, Building America’s Future contends that restricting menthol cigarette sales would jeopardize hundreds of millions of dollars in state revenue nationwide. According to a Tax Foundation analysis conducted in 2022, the measure would cost the federal government $1.9 billion and state governments a total of $4.7 billion in lost tax revenues.

    The average pack of cigarettes in the U.S. attracts $1.91 in state taxes and $1.01 in federal taxes. Additionally, every state continues to receive funds from the 1998 Master Settlement Agreement, which, translates to about $0.75 per pack in 2022, according to the Tax Foundation.

    In April 2022, the FDA issued product standards to prohibit menthol as a characterizing flavor in cigarettes and prohibit all characterizing flavors other than tobacco in cigars.

    Last month, the FDA sent the proposed regulations to the White House Office of Management and Budget for review, a final step in finalizing and eventually implementing the menthol cigarette ban.

    In related news, the convenience and fuel retailing group NACS has been urging its members to urge the White House to stop the menthol ban from moving forward, using the organization’s grassroots portal. Rather than reducing smoking, the group believes that a menthol ban would fuel illicit cigarette sales.

    For convenience stores, menthol cigarettes account for 34 percent of cigarette sales and flavored cigars account for 51 percent of cigar sales. Removing them from shelves means that current users who cannot quit or switch to other tobacco products will search for the products from illegal sources, according to the organization.

  • Revenues Down, Loss Up for 22nd Century

    Revenues Down, Loss Up for 22nd Century

    Image: Tobacco Reporter archive

    22nd Century Group reported net revenues of $17.81 million in the three months that ended Sept. 30, 2023, down from $19.38 million in the comparable 2022 quarter. Net loss was $72.72 million against a net loss of $13.1 million in the third quarter of 2022.

    “In the third quarter, our VLN footprint expanded from approximately 1,100 stores in 14 states as of June 30, 2023, to over 4,550 stores spanning 19 states. This includes the recent expansion of more than 400 stores in Florida with a leading national convenience store chain that has prior experience in VLN sales across other states,” said 22nd Century Group CEO John Miller in a statement.

    “We also initiated sales in our first nationwide drug store chain, thereby conducting sales trials in five states and diversifying the range of channels through which our products are accessible. However, our dynamic store count growth did not translate into immediate revenue. Sales of VLN were modest in the quarter as the brand is still largely unknown to our target market, and our marketing capabilities are limited given our current financial condition.”

    On Sept. 5, 2023, the company announced its intent to explore strategic alternatives in an effort to maximize shareholder value. While the initial focus was primarily on 22nd Century’s tobacco portfolio, the company subsequently received indications of interest regarding its other assets in addition to tobacco.

    In October, the company reduced the outstanding principal of its senior secured credit facility from approximately $22.1 million to approximately $14 million.

  • KT&G Boosts NGP Capacity

    KT&G Boosts NGP Capacity

    Photo: KT&G

    KT&G has expanded its Sin Tanjin next-generation product (NGP) factory.

    During a ceremony attended by CEO Baek Bok-in and over 40 employees, the company pledged to grow its NGP segment into a leading business.

    KT&G has installed three additional electronic cigarette stick production lines this year, bringing the total number to eight. It also established an automated warehouse capable of storing up to 360,000 boxes.

    KT&G plans to further expand its production innovation hubs, focusing on domestic manufacturing facilities such as Sin Tanjin and Gwangju, to ensure a smooth response to the rapidly growing demand for its NGP products.

    The expansion of the Sin Tanjin NGP factory is part of KT&G’s investment plan, which was presented during the company’s “Future Vision Proclamation” event in January.

    During that event, KT&G announced its strategy would focus on e-cigarettes, heated tobacco and the international expansion of its combustible cigarette business. The company intends to increase the revenue share of its noncombustible products to more than 60 percent by 2027 through investments and innovation.

    The Sin Tanjin NGP factory will play a role as a growth engine that enhances the essential competitiveness of the NGP business, which is strengthening its market leadership.

    Baek Bok-in , CEO, KT&G

    In September, KT&G announced the construction of a new factory in Indonesia, which will be manufacturing for exports. In October, it broke ground for a new factory in Kazakhstan, establishing a foothold in Eurasia.

    “The Sin Tanjin NGP factory will play a role as a growth engine that enhances the essential competitiveness of the NGP business, which is strengthening its market leadership,” said Baek in a statement.

    “In the future, we will lead the growth of the NGP business based on innovative technology and advanced global partnerships and will leap to the ‘global top-tier’ through domestic innovative growth investments, including expanding production infrastructure.”

  • Habanos Announces Habano Festival Dates

    Habanos Announces Habano Festival Dates

    Credit: Timothy S Donahue

    The dates for the XXIV Edition of the Habano Festival, have been announced. The exclusive cigar event is to be held in Havana from Feb. 26 – to March 1, 2024.

    Habanos, S.A., the state-run distributor of global Cuban cigars, said in a release that its annual event is “in an international and exclusive atmosphere,” and it will include a wide-ranging program of activities combining the knowledge of the Habano and the exciting culture, including the ending final evening gala dinner and famed humidor auction.

    “In this XXIV Edition, the best specialists, distributors and aficionados will enjoy all the activities that along with the best gastronomy and music have made this famous event: visits to renowned Habanos factories, plantations, seminars with interesting lectures, exclusives pairings, contests and three very special nights where they will get a sneak preview of the latest Habanos, S.A. novelties,” the release states. 

    Habanos, S.A. is already “working to make this event memorable for the expectations of aficionados with the passion and magic that they have come to expect from each new edition.”

    More details on the Habano Festival will be announced soon and registration will be open to the public.

  • Meeting Fails to Ease Growers’ COP Fears

    Meeting Fails to Ease Growers’ COP Fears

    Photo: SindiTabaco

    Tobacco growers representatives are unlikely to be admitted to the November meeting of the Conference of the Parties (COP10) to the Framework Convention on Tobacco Control (FCTC) in Panama, according to Vera Luiza da Costa e Silva, who leads Brazil’s National Commission on the Implementation of the FCTC.

    Speaking during a round table in Brasília promoted by the House of Representatives. Costa e Silva said the COP has a strict policy of denying access to those who have a conflict of interest. “The secretariat, based at the WHO headquarters, has the credentials to deny participation if some kind of relationship with the industry is at stake,” she explained.

    Costa e Silva also insisted that the FCTC does not mention actions that will directly impact the supply chain, but industry representatives participating in the Brasilia meeting weren’t buying it. “Today were told […] that there has never been any attempt to endanger the production of tobacco, but we know that this is not true,” said Iro Schunke, president of the Interstate Tobacco Industry Union, in a statement.

    He pointed to actions in what he described as a methodical battle against the production of tobacco in Brazil. “They accuse the sector of deforestation, but it is the segment that has the biggest forest areas,” said Schunke. He also countered allegations of tobacco farmer vulnerability, pointing to recent research suggesting that tobacco farmers earn up to twice the national average income.  

    Despite concerns about global demand, Brazilian tobacco production and exports have been stable, Schunke noted. Farmers in southern Brazil have planted enough tobacco to harvest 604.73 million kg in 2023—7.95 percent more than in 2022, according to the country’s tobacco growers’ association, Afubra.

  • Study Confirms Minimal Carcinogenic Effects

    Study Confirms Minimal Carcinogenic Effects

    Photos: CoEHAR

    The aerosol from e-cigarettes induced slight to no cytotoxic, mutagenic and genotoxic effects during tests conducted by the Replica research team of the Center of Excellence for the acceleration of Harm Reduction (CoEHAR) that compared these effects to those induced by cigarette smoke.

    According to CoEHAR, science has been suffering from a “replicability crisis” in recent years. The use of different research methodologies usually leads to different data, resulting in flawed results that misinform policies and impact on health and social care practices, as well as smokers who are seeking a complete cessation.

    Replica researchers aim to fill this methodological gap by replicating  international in vitro studies on the toxicity of cigarette smoke and e-cigarette aerosol by an independent and multicentric approach, adding experiments or conditions where necessary, in order to verify the robustness and replicability of the data and results.

    The most recent study replicated by the team was published by Rudd and colleagues in 2020. The study aimed to establish the cytotoxicity, mutagenesis and genotoxicity of cigarette smoke or e-cigarette aerosol on cells .

    Replica researchers performed a standard toxicology battery of three assays used for product assessment and regulatory applications. Their results, published by Springer Nature’s Scientific Reports,  indicated that e-cigarette aerosol was low cytotoxic and it did not show any mutagenic or genotoxic activity unlike the cigarette smoke, which showed high cytotoxic, mutagenic and genotoxic activity. Moreover, the Replica study covered some methodological gaps and limitations in the original work, by adding some conditions with the aim of covering all the possible ways of inducing genotoxicity and mutagenesis on cells.

    Our findings not only confirmed the results obtained by our colleagues but also addressed some methodological gaps and limitations in the original work.

    First author Rosalia Emma

    “Our findings not only confirmed the results obtained by our colleagues but also addressed some methodological gaps and limitations in the original work,” said Rosalia Emma, first author of the Replica study, in a statement. “However, it’s important to highlight that, despite using different machinery and the variations in the exposure methodology, in the case of cytotoxicity (NRU assay), the toxicity of the e-cigarette is significantly lower than that of traditional cigarettes”.

    In the Replica study, the team performed the NRU assay to assess cytotoxicity, the bacterial reverse mutation (Ames) assay to evaluate mutagenicity and the in vitro micronucleus assay to measure genotoxicity. Despite some different methodologic aspects, the researchers obtained results similar to those obtained by Rudd and colleagues.

    “Although we have added experimental conditions neglected by the authors of the first paper, the results obtained previously are confirmed and even strengthened, confirming the electronic cigarette as a useful tool for reducing smoking damage in healthy smoking subjects” said Massimo Caruso, co-project leader of the Replica project and corresponding author.

  • Azerbaijan Prepares Exports for Italy

    Azerbaijan Prepares Exports for Italy

    Photo: Taco Tuinstra

    Azerbaijan tobacco processing factory “Azertertun” has begun production of cured tobacco with principal products for export to Italy, according to 2Firsts.

    The factory reportedly uses advanced production equipment from the United States, Italy and Germany. This year, 620.1 hectares of tobacco were cultivated in Balakan, Zagatala, Gakh, Sheki, Oguz and other areas, according to the factory’s general manager.

    An estimated 470 tons of processed fine-cut tobacco will come from the cultivated leaf. 

  • Universal’s Income Jumps 30 Percent

    Universal’s Income Jumps 30 Percent

    Photo: Tobacco Reporter archive

    Universal reported sales and other operating revenue of $1.16 billion for the six months that ended Sept. 30, up 7 percent over that posted for the comparable 2022 period. Operating income jumped 30 percent to $66.3 million.

    Universal Chairman, President and CEO George C. Freeman III expressed satisfaction with the results. “Our Tobacco Operations segment delivered strong performance in the first half of fiscal year 2024,” he said in a statement.

    According to Freeman, Universal benefited from robust demand for leaf tobacco and a favorable tobacco product mix. Leaf tobacco margins improved in the first half of fiscal year 2024, despite lower leaf tobacco sales volumes, as the company had fewer shipments of lower margin tobacco compared to the first half of fiscal year 2023.

    Segment operating income for Universal’s tobacco operations segment was up 46 percent compared with the previous year’s six-month period. Uncommitted tobacco inventory levels of 12 percent at Sept. 30, 2023, remained low, and global leaf tobacco supply continues to be tight for all types of tobacco, according to Freeman.

    “Looking ahead, we continue to expect that, similar to fiscal year 2023, our tobacco shipments will be strongly weighted to the second half of the fiscal year 2024,” he said. “We also believe our uncommitted tobacco inventory levels will remain low for the rest of fiscal year 2024.”

  • BAT Appoints CFO

    BAT Appoints CFO

    Image: tonsnoei

    Soraya Benchikh has been appointed to the role of chief financial officer and executive director at BAT. She will join the boards from May 1, 2024, succeeding Javed Iqbal, who will continue to serve as interim finance director until April 30, 2024.

    Benchikh has been president of Europe at Diageo since January 2023, having joined Diageo in July 2020 as managing director for Northern Europe. Benchikh previously spent 20 years at BAT, where she served as president of BAT France, area director for East and Southern Africa and regional finance director for Europe. Earlier in her career, Benchikh worked in finance roles at General Electric and Gillette.

    “I am pleased to welcome Soraya as chief financial officer and to the board,” said BAT chair Luc Jobin in a statement. “She brings a wealth of leadership experience and commercial acumen from across both finance and commercial roles. Soraya’s excellent track record in different geographies and in-depth understanding of the sector make her ideally suited for the role.”

    “I am delighted to welcome Soraya to the management board as our new chief financial officer,” said BAT CEO Tadeu Marroco. “Her extensive senior leadership and financial experience from a range of international fast-moving consumer goods companies represents a great addition to our leadership team. I am grateful to Javed for his continued contribution as interim finance director in addition to his ongoing role as director, digital and information.

    “Following the recent appointment of Dr. Cora Koppe-Stahrenberg as chief people officer, Soraya’s appointment is also a further important step toward building a modern organization. I very much look forward to working with Soraya as we continue our transformation.”

    “I am excited to rejoin the leadership of BAT as chief financial officer and executive director and share their passion for the transformation strategy,” said Benchikh. “I am looking forward to working with my new colleagues, the leadership team, Tadeu and the board and leverage my recent experience within broader FMCG to provide an external lens and support their efforts to accelerate BAT’s strategy to build ‘A Better Tomorrow.’”

  • Vaping Down Among U.S. Youth

    Vaping Down Among U.S. Youth

    Photo: Daisy Daisy

    One in 10 U.S. middle and high school students reported using of any type of tobacco, according to data from the 2023 National Youth Tobacco Survey (NYST) that were collected between March and June 2023 and released today.

    Among U.S. high school students, current overall tobacco product use declined during 2022-2023 from 16.5 percent to 12.6 percent, a development attributed primarily to reduced e-cigarette use, which dropped from 14.1 percent to 10 percent. Among high school students, declines in current use were also observed during 2022-2023 for cigars and overall combustible tobacco smoking, representing all-time lows.  

    “It’s encouraging to see this substantial decline in e-cigarette use among high schoolers within the past year, which is a win for public health,” said Brian King, director of the U.S. Food and Drug Administration’s Center for Tobacco Products, in a statement. “But we can’t rest on our laurels. There’s more work to be done to build on this progress.”

    Among middle school students there was an increase in current overall tobacco product use (4.5 percent to 6.6 percent) and multiple tobacco product use (1.5 percent to 2.5 percent). However, among middle school students overall, no significant change was observed during 2022-2023 for current use of any individual tobacco product type, including e-cigarettes.

    It’s encouraging to see this substantial decline in e-cigarette use among high schoolers within the past year, which is a win for public health. But we can’t rest on our laurels.

    Brian King, Director, CTP

    E-cigarettes remained the most commonly used tobacco product among both high school and middle school students for the 10th year in a row. Among youth who reported current e-cigarette use, approximately one-quarter reported using e-cigarettes every day. Disposable e-cigarette products were the most common product type used by youth who reported e-cigarette use. However, the most popular brands included both disposable and cartridge-based products. Among current youth e-cigarette users, the most commonly reported brands were Elf Bar (56.7 percent), Esco Bars (21.6 percent), Vuse (20.7 percent), Juul (16.5 percent) and Mr. Fog (13.6 percent).  

    Among youth who reported current e-cigarette use, nearly all used flavored products (89.4 percent), with fruit, candy, mint and menthol being the most commonly used flavors. For the first time in NYTS, the 2023 questionnaire asked about use of flavors that included the word “ice” or “iced” in their name, along with other concept flavor names—that is, names that imply flavor but do not explicitly indicate any particular flavor, such as “island bash.”

    R.J. Reynolds Tobacco Co. said it welcomed the decline in overall youth tobacco use. “This is good news, and we agree with Dr. King that more needs to be done,” the company wrote in an e-mailed statement.  “Future progress requires regulators—especially FDA—to seriously address the influx of irresponsibly marketed, illegal flavored disposable vapor products.”

    In October, Reynolds filed a complaint with the International Trade Commission charging multiple manufacturers, distributors and retailers of disposable vaping devices with unfair importation.