Category: Sustainability

Be afraid, be very afraid
The UK Government is moving the country on to a no-deal Brexit footing even though it says it believes a no-deal ‘scenario’ is unlikely.
It is issuing a series of ‘technical notices’ setting out ‘information to allow businesses and citizens to understand what they would need to do in a “no-deal” scenario, so they can make informed plans and preparations’.
One such notice provides ‘information to organizations, businesses and members of the public concerned with tobacco and related products, regarding changes to the regulation of such products in the unlikely event that the UK leaves the European Union (EU) in March 2019 with no agreement in place’. The notice does not include tax issues, however.
Some of the UK laws that regulate tobacco products and e-cigarettes implement the Tobacco Products Directive 2014/40/EU and the Tobacco Advertising Directive 2003/33/EC, as well as a number of delegated and implementing acts made under the Tobacco Products Directive.
EU-derived policy and legislation regarding tobacco and related products cover areas including:
- control of sale of products
- advertising
- product standards (such as ingredients of products and their emissions)
- and packaging.
The Tobacco Products Directive also sets reporting requirements for tobacco products and e-cigarettes. Manufacturers must submit specified information on ingredients and emissions for products before they are placed on the market.
‘If the UK leaves the EU in March 2019 with no agreement in place, the Tobacco Products Directive and the Tobacco Advertising Directive would no longer directly apply to the UK,’ according to a note at GOV.UK.
‘The UK domestic law that implements these directives, such as the Tobacco and Related Products Regulations 2016, would remain in force, with minor amendments to ensure it still works effectively after EU exit. These amendments would be brought in through regulations made under the EU (Withdrawal) Act powers and would come into force on exit day.
‘The amendments to UK tobacco legislation would include giving the UK government the power to update the legislation in response to emerging threats, changing safety and quality standards, and technological advances. These updating powers are likely to have minimal impact on industry. Their purpose is to make sure that the UK is still able to make technical changes after we leave the EU, where needed.’
In the event of a no-deal Brexit, the Government says it would:
- ‘Create new domestic systems to allow producers to notify tobacco products and e-cigarettes in accordance with existing rules. Manufacturers will need to submit information on the new systems for any new products that they wish to sell in the UK.
- ‘Introduce new picture warnings for tobacco products as the copyright for the existing picture library is owned by the European Commission. Manufacturers will need to ensure that tobacco products which include picture warnings produced from Exit Day onwards will be labelled with the new picture warnings.’
The notice said the Government would be consulting on the technical details of both these issues in September ‘to ensure that changes are simple and effective, to minimise the burden of any changes’.
‘Inevitably, under a “no-deal” scenario the close working relationships that exist with our European partners would not be the same,’ the notice added. ‘The UK will, of course, continue to play an active role in the World Health Organization Framework Convention on Tobacco Control.’
The Government says that further information on new systems for notification and picture warnings will be provided as part of the consultation and when the new legislation is introduced.
August 24, 2018
The industry has no clothes
United Nations agencies must join forces at the policy level and refuse interference from tobacco companies in their programs so the destructive impact of tobacco can be effectively addressed and lives can be saved, according to a UN News story quoting the head of the World Health Organization’s Framework Convention on Tobacco Control (FCTC) Secretariat, Dr. Vera Luiza da Costa e Silva.
The News story said the FCTC, which was celebrating its 15th anniversary of adoption this year, was a global health treaty that advocated the control of tobacco production, sale and use, as a way to reduce tobacco-related illnesses, deaths, environmental degradation and poverty across the world.
‘According to a report by WHO and the UN Development Programme (UNDP), it is estimated that up to one billion people could die from tobacco-related diseases this century,’ the story said. ‘Currently, over seven million people die every year due to tobacco use.
‘In addition, tobacco costs the global economy over a trillion dollars annually in medical expenses and lost productivity. As for the environmental impacts – deforestation and soil degradation for tobacco cultures, as well as water and soil pollution from cigarette littering – they cannot be overstated.’
“In 15 years, we have made a lot of progress, with tobacco-control measures in place in most of the world’s countries for example,” said da Costa e Silva. “But we are still facing a great deal of interference from the tobacco companies in government decision-making and even inside our own house, within UN agencies.”
Article 5.3 of the Convention requires that parties to the treaty ensure that their public health policies are protected ‘from commercial and other vested interests of the tobacco industry’. The article is based on the idea that there is a fundamental and irreconcilable conflict between the tobacco industry’s interests and public health interests.
“They are wolves masquerading as sheep,” said da Costa e Silva, referring to poverty-reduction programs and other development projects that tobacco industry giants are funding, in partnership with several international inter-governmental organisations.
August 24, 2018
Tariffs take their toll
The impression among US leaf dealers is that Chinese buyers have decided to honor their contracts with the US Tobacco Co-operative and some individual growers they have previously contracted with, according to the most recent issue of Christopher Bickers’ Tobacco Farmer Newsletter.
US tobacco is one of the products implicated in the trade dispute between the US and China and the dealers have apparently been led to believe that there will be no other Chinese purchases of US flue-cured this year.
Bickers (cebickers@aol.com) reported also that the prices offered at the opening sales that took place this week at most of the flue-cured auction warehouses were not encouraging.
Meanwhile, the first round of US tariffs on Chinese vapor products has taken effect with the imposition of a 25 percent tax on all shipments of ‘e-cigarettes, mods, batteries, and similar devices from China’, according to a Vaping360 story relayed by the TMA.
The story said the tax would be felt by US importers, wholesalers, retail sellers, and vapers because very little domestic manufacturing existed.
“For the vast majority of American vapers, the choice is not going to be an American-made product versus a Chinese-made product with a 25 percent tariff,” American Vaping Association president Gregory Conley was quoted as saying. “It’s only going to be the latter, which isn’t much of a choice at all.”
August 24, 2018

Providing a vital service

The results of new research released yesterday reveals a more-than thirty-fold increase in the number of vape shops in the UK during the past five years – from less than 100 in 2013 to 2,850 in 2018.
The research, carried out by the Centre for Economic and Business Research on-behalf of Philip Morris Limited, found that the rapid spread of vape shops across the country has coincided with significant falls in the prevalence of smoking, with some of the largest declines in smoking rates during the past five years being observed in regions with a particularly prominent vaping sector.
On a wider front, vape shops are becoming a significant presence on the high street while other stores, particularly those of grocers, newsagents and electrical goods retailers, are in sharp decline. Forty percent of vape shops were found to be trading from premises that were previously vacant, and vape shop owners are estimated now to employ close to 6,000 people directly in-store.
A PM press note announcing the research findings said that UK sales of vape products had reached £1 billion in 2017 and that this was expected to reach £2 billion by 2020, according to Euromonitor International.
The research found that the North West was the UK’s number one vaping hotspot with 456 vape shops – one for every 2,019 adult smokers in the region. The region had experienced also one of the biggest declines in smoking prevalence, with the adult smoking rate falling by four percent between 2013 and 2017.
“This research clearly shows the huge contribution vape shops are making in helping smokers switch away from cigarettes,” Mark MacGregor, PMI UK corporate affairs director, was quoted as saying. “According to ASH, 50 percent of all smokers do not realise that e-cigarettes are significantly less harmful than smoking. Vape shops have an incredibly important role to play in raising awareness of the various alternatives to smoking, including e-cigarettes and heated tobacco.”
Top 5 hotspots
Vaping hotspots by total number of vape shops

	Vape shops (2018)	Smoking prevalence 2013	Smoking prevalence 2017	Change in smoking prevalence
North West	456	20.0%	16.1%	-4.0%
South East	319	17.2%	13.7%	-3.5%
London	309	17.1%	14.6%	-2.5%
Yorkshire and the Humber	304	20.5%	17.0%	-3.5%
West Midlands	265	17.8%	14.2%	-3.5%

August 22, 2018

When ultra-fine is not fine
The European Commission has said that it is carrying out a fitness check of its two EU Ambient Air Quality directives to determine by next year whether they are ‘fit for purpose’.
The Commission was responding to a question From a French member of the European Parliament inspired by reports of poor air quality at Étang de Berre, which is in the south of France and which comprises one of the largest industrial areas in Europe, with more than 200 factories.
‘It turns out that, in 2010, the French Institute for Public Health Surveillance highlighted an excessive number of hospitalizations for cardiovascular conditions and for multiple illnesses west of Étang de Berre,’ Mélin said in a preamble to her question.
‘In January 2017, new information emerged from the community-based participatory environmental health survey (CBPEH), which noted the high likelihood of a link “between the illnesses and industrial pollution”.
‘However, in 2011, the Eco-citizen Institute launched campaigns to measure the air quality, which resulted in it noting that the air around the industrial area “was made up of 80 percent ultra-fine particulate matter and [that] the chemical composition of the air pollutants was extremely complex”.
‘Ultra-fine particulate matter is the most dangerous for our health because it gets deep into our bodies.
‘However, if Air Paca [a non-profit association that manages the air quality survey network in south-eastern France’s Provence Alpes Côte d’Azur region] does not measure it, it is because European legislation does not require member states to measure the levels of ultra-fine particulate matter.
‘Therefore, we would like to know whether the Commission wishes to encourage member states to measure the levels of ultra-fine particulate matter in order to assess toxicity of the air in industrial areas in more detail.’
In response, the Commission said that when the World Health Organization published its latest Air Quality Guidelines in 2006, it had concluded that, while there was considerable toxicological evidence of potential detrimental effects of ultra-fine (UF) particles on human health, the existing body of epidemiological evidence was insufficient to reach a conclusion on the exposure–response relationship of UF particles. ‘Therefore, no recommendations were provided at that time as to guideline concentrations of UF particles,’ the Commission said in its written reply.
‘The Ambient Air Quality directives, which were last revised in 2008, do not require the assessment of air quality with respect to ultrafine particles.
‘The Commission is carrying out a fitness check of the two EU Ambient Air Quality directives, which will evaluate whether these two complementary directives are “fit for purpose” by assessing the overall performance of this regulatory framework with respect to its policy objectives.
‘The fitness check covers all provisions of the two EU Ambient Air Quality directives. In particular, it will include an assessment of the extent to which the directives continue addressing the most pressing air pollutants and set meaningful air quality standards to protect human health and ecosystems in accordance with the evolving scientific understanding.
‘The findings of the fitness check will be used to inform further reflections on whether the directives continue to provide the appropriate legislative framework to ensure protection from adverse impacts on, and risks to, human health and the environment.
‘The Commission expects to conclude this fitness check in 2019.’
August 20, 2018
All of a twitter
The tobacco industry’s ‘global online activities’ need to be regulated, according to researchers in Australia.
‘Transnational tobacco companies are using Twitter to oppose tobacco control policy and shape their public identity by promoting corporate social responsibility initiatives in violation of [the] WHO [World Health Organization] Framework Convention on Tobacco Control,’ the researchers concluded in the abstract of a Tobacco Control paper published on the BMJ Journals website.
‘The tobacco industry has a long history of opposing tobacco control policy and promoting socially responsible business practices. With the rise of social media platforms, like Twitter, the tobacco industry is enabled to readily and easily communicate these messages.
The researchers said that all tweets published by the primary corporate Twitter accounts of British American Tobacco, Imperial Brands, Philip Morris International and Japan Tobacco International had been downloaded in May 2017 and manually coded under 30 topic categories.
Out of the 3,301 tweets analysed the most prominent categories of tweets were said to have been on topics that opposed or critiqued tobacco control policies (36.3 percent of BAT’s tweets, 35.1 percent of Imperial’s tweets, 34.0 percent of JTI’s tweets and 9.6 percent of PMI’s tweets).
All companies were said to have tweeted consistently to promote an image of being socially and environmentally responsible.
August 16, 2018
Tax smokers, not vapers
If the UK Government increased the cost of vaping through the imposition of taxes on electronic cigarettes it would discourage the very thing it was trying to encourage: the switch from smoking to vaping.
This was the essence of a statement by Dan Marchant, director of the Vape Club and board member of the UK Vaping Industry Association, following the publication of stories suggesting that the Government was considering taxing electronic cigarettes as part of its autumn budget.
One aim of the tobacco control plan, Marchant said, was to reduce smoking prevalence among people within the lowest earning brackets. Increasing the cost of the most effective alternative to smoking would not help achieve this goal. In fact, it would do the opposite.
Switching from smoking to vaping provided harm reduction benefits, but another of its attractions was that it offered significant monetary savings. Increasing the cost of vaping would decrease its attractiveness to smokers and have a detrimental effect on encouraging people to move away from tobacco.
The best thing smokers could do for their health, Marchant said, was to quit smoking. However, the evidence was increasingly clear that the use of e-cigarettes was significantly less harmful than was smoking tobacco. The government sought to support consumers in stopping smoking by adopting the use of less harmful nicotine products. At the same time, Public Health England (PHE) had produced guidance for employers and organizations looking to introduce policies on e-cigarettes and vaping in public, and had recommend such policies be evidence-based. PHE recommended that e-cigarette use was not covered by smoke-free legislation and should not routinely be included in the requirements of an organization’s smoke-free policy.
Meanwhile, Marchant said that maintaining high duty rates on tobacco products was a proven and effective means to reduce smoking. As well as providing an incentive to quit for those who smoked, it provided a disincentive for young people to take up smoking.
‘Although national smoking prevalence continues to decline, the picture is not so positive for all groups and communities across England,’ he said. ‘Smoking remains highest among populations who already suffer from poorer health and other disadvantages.
‘In 2015, there were almost three times as many smokers among the lowest earners in our society in comparison to the highest earners. In 2016, the prevalence of smoking among people working in jobs classed as routine and manual was more than double that of people working in managerial and professional occupations. If we are to achieve the first smoke-free generation and break this cycle, we must support those populations where smoking rates remain high to quit.’
Marchant said that rather than taxing vapers, the Government should further increase the ‘sin-tax’ on cigarettes. This would raise more money since there were more than seven million smokers and 2.8 million vapers, half of whom still smoked to some degree. Such a strategy would fit with the Government’s tobacco control-plan guidance.
August 15, 2018
Smokers to pay the price
In announcing that it had applied to increase the retail prices of its tobacco products, Japan Tobacco Inc. said today that declining sales made it difficult to maintain quality and services with cost reductions alone.
JT said it had applied to the Minister of Finance for approval to ‘amend’ retail prices of tobacco products in Japan in conjunction with a planned tobacco-excise-tax hike on October 1.
JT said it had applied to increase the retail prices of 143 products, including 122 cigarettes, one cigarillo, three pipe tobaccos, three cut tobaccos and 14 snuff tobaccos. Additionally, it said it had applied for seven Ploom TECH product price rises in the tobacco vapor category.
‘The Japanese domestic tobacco market continues to experience decreasing sales volumes due to structural factors including the aging and declining adult population, as well as increasingly stringent smoking restrictions,’ the company said in a note posted on its website. ‘At the same time the cost per pack for providing the same quality and services has been increasing. Under these circumstances, JT had been maintaining the quality and price levels through cost reducing efforts.
‘However, since JT is projecting a further sales volume decline, it is very difficult to maintain the same quality and services with cost reduction initiatives alone. In this context, JT has applied to amend the retail prices of cigarettes, which exceeds the excise tax hike of ¥1.0 per cigarette, considering further increases in costs including materials. Retail price increases will vary among different brands and products, to ensure that the quality of each product will be maintained and that consumer expectations continue to be met.’
JT added that, within the tobacco vapor category, a new tax system would be imposed in stages over a five-year period. JT said it had decided to apply a ¥30 increase to the retail price of Ploom TECH, whose tax was expected to be increased by ¥30.89 a pack.
A table of representative brands presented in the note indicated that the retail price of a pack of Mevius cigarettes would rise by ¥40 to ¥480, while the price of Winston and Hi-Lite would increase by ¥30 to 450, and the price of Hope would go up by ¥20 to ¥250.
‘New retail prices will be effective on October 1, 2018, following the Minister of Finance’s approval,’ JT said.
August 14, 2018
Israel looks to ban Juul
The Israeli Ministry of Health has come out in favor of banning the marketing of the e-cigarette Juul, according to a story by Adrian Filut and Lilach Baumer for Calcalist, quoting officials at the ministry.
The decision about whether such a ban is introduced now hinges on its receiving a stamp of approval from the country’s attorney general.
A report in the Ha’aretz newspaper, meanwhile, suggested that the ban would apply to ‘nicotine-rich electronic cigarettes like [presumably meaning such as] the popular Juul’.
The Calcalist story said that sales of Juul, which was launched initially in the US in 2015, had gained momentum during the past 12 months. ‘According to a CNBC article citing data by market research firm Nielsen published Saturday, Juul’s sales have shot up almost 800 percent over the past year and the company now controls around 71 percent of the US e-cigarette market,’ it said.
Juul was launched in Israel in May and in the UK in July. The product’s consumable pods sold in Israel are rated at 5 percent nicotine, while those sold in the UK are rated at 1.7 percent, to comply with European regulations.
Grant Winterton, Juul Labs’ president for Europe, the Middle East and Africa, told Reuters last month that the UK had been chosen as Juul’s third market after the US and Israel, partly because it had the world’s “most supportive government” when it came to encouraging smokers to vape. Also on the radar were said to be France, Germany and Italy.
Israel, on the other hand, seems opposed to reduced-risk products in general. In March, the Knesset’s Finance Committee approved a measure to tax heated-tobacco products such as Philip Morris International’s IQOS at 65 percent of the retail price, in line with the tax on cigarettes.
August 8, 2018
AOI spreads its wings

Pieter Sikkel
As part of its One Tomorrow strategy, Alliance One International is continuing to make measured investments in industrial hemp, e-liquids and legal Canadian cannabis business lines as the company builds its capabilities to position them for further success in evolving regulatory and consumer environments, said president and CEO Pieter Sikkel in announcing AOI’s first quarter results.
‘Our industrial hemp joint venture, Criticality, LLC, (Criticality) is taking active steps to become a leader in the production of cannabidiol hemp oil (CBD) and related consumer products,’ Sikkel said. ‘We look forward to receiving and processing hemp at Criticality’s facility in North Carolina this fall.
‘Our e-liquids investments continue to demonstrate positive momentum. Last month, Fontem Ventures introduced Salt of the Earth, an additional product line that is a direct result of the relationship with our Purilum joint venture and utilizes Purilum’s premium nicotine salt e-liquids.
‘As October 17, 2018, the effective date for legalization of recreational cannabis use in Canada, draws closer, our Canadian cannabis subsidiaries are rapidly gearing up to meet expected consumer demand beyond the current legal medicinal market. As previously announced, construction work on an additional 310,000 square feet of greenhouse and warehouse space is underway as FIGR, our wholly owned indirect Canadian subsidiary, works toward its total goal of over one million square feet of production in that market.’
Sikkel said that the fiscal year had got off to a strong start and that AOI was building positive momentum in its leaf business and making continued progress on its One Tomorrow transformation initiative announced earlier this year.
He said that strong operating plans had been put in place, including ‘measured inventory reductions’.
‘We continue to optimize our global footprint and have taken steps to capitalize on opportunities in regional markets, further positioning our leaf business to meet the evolving needs of tobacco product manufacturers…
‘The investments we have made in agronomy services and our track-and-trace technology remain an integral component of all aspects of our business.
‘As our contracted farmer base continues to increase the yields of their non-tobacco crops, we are actively working to build the value-added processes that will support the diversification of their incomes.
‘By keeping the farmer at the center of everything we do, we are able to confidently provide customers across all of our business lines with sustainable and traceable agricultural products, ingredients and services.’
Alliance reported total sales and other operating revenues increased by 5.1 percent to $291.0 million as, it said, crops in South America and other origins returned to a more normalized cycle when compared to that of the same period of the previous fiscal year.
Gross profit increased by 44.8 percent to $41.4 million, and gross profit as a percentage of sales was 14.2 percent this year, up from 10.3 percent.
Operating income increased by $5.3 million to $4.7 million.
Net loss attributable to Alliance One International, Inc. for the quarter improved to $0.8 million, compared with $32.5 million last year, and adjusted EBITDA improved by 93.7 percent to $19.4 million.
August 3, 2018