Category: Featured

Zimbabwe: Growers Start Land Preparations

Photo: YanaKho
Tobacco growers in Zimbabwe have started preparing land to plant their irrigated tobacco crop in early September, reports The Herald.
Sept. 1 is the earliest legislative date for transplanting tobacco from the seedbed to the field. The bulk of the rain-fed crop will be planted from October to early December, depending on the region. To prevent the carryover of diseases, tobacco farmers are required to destroy tobacco stalks and regrowths, which can host pest and pathogens, by May 1 each year.
Industry representatives expressed concern about the cost of agricultural inputs this year.
“The major challenge on the ground is that input prices are very high, hence the majority of farmers are finding it difficult to continue with tobacco farming,” said Edward Dune, vice president of the Zimbabwe National Farmers’ Union, urging authorities to improve the conditions of payment.
This season, tobacco farmers were paid three quarters of their proceeds in foreign currency and the balance in local currency, converted at the prevailing auction exchange rate on the day of sale.
According to the Tobacco Industry and Marketing Board, prices at the auction floors, at US$3.04, were firm because of low volumes. In 2022, tobacco growers pocketed more than US$620 million from their leaf sales.
August 15, 2022
Tobacco Packaging Innovations Under Fire

Image: Tobacco Reporter archive
The tobacco industry has been developing innovative packaging to minimize the impact of regulatory requirements such as graphic health warnings, particularly in low- and middle-income countries, according to a study published in BMJ Innovations.
Mounting restrictions on tobacco advertising have made the tobacco pack an increasingly important tool for the industry to communicate with its customers. Cigarette packs in effect act as miniature billboards for the product.
Confronted with requirements to print large health warning labels that leave less space for branding, tobacco companies have found ways to maximize and even increase the space available for marketing on packs, according to the study’s authors. Examples include inserts, sliding flip tops and butterfly panels exposing additional surfaces upon opening.
These surfaces often feature bright colors and patterns, intricate imagery, shiny and textured surfaces, and holograms to appeal to customers, according to the authors. The extra “real estate” can be used to include information about contests or marketing appeals and QR codes that lead current and potential smokers to websites that include engagement strategies.
In addition to examples of packaging innovations—which are generally legal—the authors also cite evidence of explicit manipulation of health warnings. Smokeless tobacco packs purchased in India in 2017, for example, featured blurred, stretched and tinted labels. Health warning labels on cigarette packs purchased in Pakistan in 2019 and 2020 were tinted, faded, blurred. In some instances, the background color was changed and the size of throat cancer included in the image was reduced.
The authors did not consider the possibility that some distortions might be a result of poor printing quality rather than deliberate manipulation.
To prevent the industry from developing packaging that reduces the impact of health warnings, the researchers urged lawmakers to require standardized tobacco packs in their jurisdictions.
August 14, 2022
Graphic Warnings Date Postponed Again

Image: FDA
The implementation date for graphic health warnings in the United States has been pushed back by another three months, to Oct. 6, 2023, reports the Winston-Salem Journal.
On Aug. 10, a U.S. District Court Judge in Texas approved the most recent launch date postponement for cigarette manufacturers. It is at least the ninth judge-ordered delay.
The FDA released its final rule requiring new graphic warnings for cigarettes in March 2020. The rule calls for labels that feature some of the lesser known health risks of smoking, such as diabetes. The graphic warnings must cover the top 50 percent of the front and rear panels of packages as well as at least 20 percent of the top of advertisements.
In April and May 2020, cigarette manufacturers and retailers sued the FDA, arguing that the graphic warning requirements amount to governmental anti-smoking advocacy because the government has never forced makers of a legal product to use their own advertising to spread an emotionally charged message urging adults not to use their products.
In a more recent challenge, tobacco companies argued that the deadline was too onerous due to the impact of the Covid-19 pandemic. They also pointed to the risk that they would lose their investments in new packaging if the graphic health warning requirement were to be thrown out in court.
In March 2021, the Texas District Court granted a motion by the plaintiffs to postpone the effective date of the final rule to April 14, 2022. The move was followed by additional postponements.
August 14, 2022
Pyxus Reports First Quarter Results

Photo: Pyxus International
Pyxus International reported sales and other operating revenues of $343.9 million for the fiscal quarter that ended June 30, 2022, up 3.2 percent over the comparable 2021 quarter. Net loss increased 27.8 percent to $14.7 million, primarily due to a $7.6 million decrease in income tax benefit. Adjusted EBITDA increased 17.1 percent to $17.3 million.
“As expected, our first quarter was consistent with the prior fiscal year, with increased demand and more normalized timing of shipments from Asia, partially offset by the timing of shipments from Africa and South America,” said Pyxus President and CEO Pieter Sikkel in a statement.
“As of June 30, 2022, our inventory increased $126 million compared to the prior year primarily due to higher new crop green tobacco prices and processing costs in South America, and accelerated new crop buying activities in certain key markets. In addition, our processed tobacco inventory continues to be more than 90 percent committed to specific customers.
“The overall increase in inventory and our committed inventory levels for processed tobacco position us to meet near-term demand and we expect to see stronger shipments in subsequent quarters in fiscal 2023, consistent with historical trends. Despite higher green tobacco prices and processing costs in South America, we were able to effectively manage our working capital to meet our purchasing goals for the current crop cycle.
“Crop sizes in certain markets in Africa, Asia and South America are below expectations due to the adverse impacts of prevailing La Nina weather patterns during the growing season, which has exacerbated supply shortages. We continue to engage with customers in transparent dialogue regarding the impacts of La Nina and inflation on our business. In response to these and other market dynamics, we accelerated buying activities in certain key markets, and continue to invest in research trials, local programs, and additional training for our global agronomy team to further support our efforts to maximize grower efficiencies and yield despite unpredictable weather patterns.
“We continue to expect fiscal 2023 sales to be between $1.75 billion and $1.95 billion and adjusted EBITDA to be between $130 million and $160 million. Moving forward, we are committed to recovering crop sizes, and aligning volumes in future years with customer expectations, as we work to deliver stakeholder value, and together, grow a better world.”
August 12, 2022
‘FDA Took Shortcuts in Reviewing PMTAs’

Image: smolaw11
In establishing whether a nicotine product is appropriate for the protection of public health, the U.S. Food and Drug Administration held its Center for Tobacco Products (CTP) reviewers to a lower standard than the companies submitting premarket tobacco product applications, according to Alex Norcia writing in Filter.
Citing documents obtained through the Freedom of Information Act, Filter describes procedures such as batching and bracketing, which allowed the CTP to apply conclusions to categories of products rather than evaluating them separately. “Despite imposing extremely onerous bureaucratic requirements on applicants, the agency was happy to find ways to cut through its own paperwork,” writes Norcia.
“It’s clear that FDA allows itself efficient shortcuts that it has denied to applicants,” Clive Bates, director of The Counterfactual, told Filter.
“The problem has always been that FDA’s extraordinarily burdensome process was obviously tremendously wasteful for applicants, but of course it was always going to be unmanageable for the assessors in FDA. Without this sort of shortcut, the PMTA process would have become a human resources nightmare. So FDA has allowed itself the kind of efficiencies it should have offered to the applicants—batching and bracketing thousands of near-identical products.”
August 11, 2022
Mativ Reports Second-Quarter Results

Photo: SWM
Mativ Holdings, the company that was recently created out of the merger between Schweitzer-Mauduit International (SWM) and Neenah, reported earnings results for the three months ending June 30, 2022.
Including SWM legacy results, sales increased 13 percent to $426.4 million. Organically, sales grew 11 percent with strong demand and pricing actions across the business, driving top-line gains and offsetting cost increases.
“With the completion of our merger in early July to form Mativ and the close of a strong second quarter for the legacy SWM and Neenah businesses, we are poised to carry our momentum into the rest of 2022 as a unified and more scaled global leader in specialty materials,” said Mativ Holdings CEO Julie Schertell in a statement.
The company’s Engineered Papers segment sales were up 10 percent, to $138.3 million, driven by volume growth and price increases. Volumes benefited from broad-based gains across the portfolio, highlighted by continued rapid growth in heat-not-burn reduced-risk products.
GAAP operating profit was $22.4 million, down 7 percent. Adjusted operating profit was $21.5 million, down 19 percent. While contractual and market price increases and negotiated volume gains more than offset higher pulp and other material costs, operating profit and margin percentage reductions resulted mainly from rapidly escalating energy costs, particularly in Europe.
Mativ Holdings expects semi-annual contractual price increases, additional market price increase and surcharges to mitigate the impacts of escalating pulp and energy costs during the second half of the year.
August 11, 2022
FDA Starts Reviewing Menthol and Flavored Cigar Feedback

Photo: Bits and Splits
The U.S. Food and Drug Administration has received nearly 175,000 comments on its proposed Tobacco Product Standard for Menthol in Cigarettes and approximately 71,000 comments on its proposed Tobacco Product Standard for Characterizing Flavors in Cigars.
On May 4, 2022, the FDA published the proposed tobacco product standards in the Federal Register. Initially, the FDA provided a 60-day comment period for the rules, but the FDA later extended the comment period to a total of 90 days. On Aug. 2, the comment period closed.
In addition to accepting written public comments, the agency convened public listening sessions on June 13 and June 15.
The agency stressed that it would take a while to review the submitted comments, scientific data, expert opinions and facts. “FDA is committed to completing the rulemaking process as quickly as possible; however, the agency will need ample time to comprehensively review and analyze all of the comments,” wrote FDA Public Health Analyst Beaza Yeheyes in an email.
August 11, 2022
World Tobacco Asia: The Countdown is on!
Photo courtesy of Quartz Business Media
World Tobacco Asia is returning Sept. 7-8, 2022, to Surabaya, Indonesia, co-located with the award-winning World Vape Show. The first major tobacco event to take place in the region for over three years, WT Asia is a unique opportunity for professionals to see the next generation of innovative products, ingredients, materials and insight for the tobacco industry all in one place.
Registration for the event is free for all industry-related personnel and includes the following:
Exclusive show-only offers and deals from 60+ leading suppliers, including Evergrowing, Mcairlaids, Prestige Leaf, Indesso, Aiger, Truewell Filter, Focke & Co, Voedsel, BMJ, Miquel Y Costas and Aroma King.
Access to a large and growing market at one of the most prestigious events for the industry
The chance to improve and gain new industry insights by getting hands on with machinery and equipment that is designed for the next generation of smokers
Face-to-face networking with influential business leaders and senior decision makers within the tobacco industry, as well as friends – old and new
Better your understanding of available alternative tobacco and nicotine products. As this sector of the industry continues to grow, learn what sourcing and procurement options are available to help you create and build your own range of products
Insight into what the future holds for leaf tobacco-associated businesses: machinery, services, communities, and more
Access to the co-located World Vape Show, which provides free insight to exhibitors and the vaping industry
Trusted by the industry’s biggest brands and manufacturers, Quartz Business Media now delivers the world’s largest network of smoking-related B2B events in the world. In the last 12 months alone, World Tobacco, World Vape Show and World Shisha events have gathered more than 17,000 professionals in Dubai, London, Sofia and now Surabaya.
WT Asia will take place on the Ground Floor of the Grand City Convex Convention Hall in Surabaya. For more information and free registration, visit http://www.wtprocessandmachinery.com/asia.
August 11, 2022
Avanti Cigar Moves to the Dominican Republic

Photo: sezerozger
The Avanti Cigar Co. is moving its production from the United States to the Dominican Republic, citing high labor cost and difficulty in finding employees as reasons for the decision, according to a report in the Standard-Speaker.
After manufacturing premium cigars for more than 90 years in Dunmore, Pennsylvania, Avanti will shut down its U.S. factory on Aug. 31.
“The last two years have been difficult due to the Covid-19 pandemic; it is getting harder and harder to hire skilled people, able to learn and manage production activities and to guarantee business sustainability in the medium [term] and long term,” the company wrote in a statement.
Founded in 1912 in New York City as Suraci Brothers, the company moved to Scranton, Pennsylvania, around 1930, then to Dunmore in 2013.
David Ozgo, president of the Cigar Association of America, said Avanti’s move overseas fits a trend.
“This is a trend that’s been going on for decades,” Ozgo said. “In the U.S., we make a lot of premium tobacco. There is a real issue in hiring employees that probably makes it more attractive for them to move to the Dominican Republic.”
August 10, 2022
22nd Century Reports Second-Quarter Results

Photo: 22nd Century Group
22nd Century Group reported net revenue of $14.48 million for the three months ended June 30, 2022, up 73 percent over the comparable 2021 quarter. Gross profit was $892,000 for the quarter compared with $449,000 for the second quarter of 2021.
The increase in net revenue was due to increased contract manufacturing volumes as well as the addition of GVB Biopharma revenue for approximately half of the second quarter. 22nd Century Group acquired GVB Biopharma on May 13.
Revenue from tobacco-related products was $10 million, an increase of 19 percent from 2021. Revenue from hemp/cannabis-related products was $4.5 million compared to zero in the prior year, reflecting a partial quarter of GVB revenues.
22nd Century Group said it will step up the rollout of its VLN King and VLN Menthol King reduced-nicotine content cigarettes. After receiving permission from the Food and Drug Administration in December to market its VLN brands as modified-risk tobacco products (MRTPs), 22nd Century started a pilot program to sell the product at select Chicagoland Circle K stores.
“Our VLN pilot in Chicago is exceeding expectations, driving us to accelerate and expand our launch plans,” said 22nd Century Group CEO James A. Mish in a statement. “The pilot and consumer studies have made clear that our approach focusing on awareness, education and trial is working with adult smokers. We are now testing specific offers designed to increase trial and repeat purchase among existing smokers looking to smoke less/reduce their nicotine consumption while also expanding our presence in Chicago and the state of Illinois.
“We are also expanding our VLN launch to the state of Colorado ahead of plan. Colorado offers a reduced taxation rate for MRTP-authorized products, providing a favorable cost structure for our VLN products in that state as compared to traditional premium cigarettes.
“Additionally, and more importantly, we are working closely with a major consumer packaged goods distributor and a longstanding specialty distributor covering convenience, grocery and drug stores across the state, giving us full access to a broad range of more than 3,000 targeted statewide potential points of sale.”
August 10, 2022