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  • Eastern Boosts Production to Cigarette End Shortage

    Eastern Boosts Production to Cigarette End Shortage

    Egypt’s Eastern Co. will provide 50 million more cigarettes daily starting Aug. 13, 2023, to alleviate the prevailing cigarette crisis, reports Ahram Online.

    The company will increase the number of cigarettes in the market to 150 million per day, up from 100 million cigarettes, Eastern Co.’s Managing Director and CEO Hany Aman was quoted as saying.

    Tobacco prices have surged recently on the black market amid a shortage of supply in the market.

    Aman said that by boosting supply in the market, the company aims to control unjustified price hikes and curb speculative practices by some traders, who began to stockpile cigarettes after they heard of a new cigarette taxation legislation.

    The MD expected cigarette prices to return to normal within three to four weeks following the production increase.

    Fakhry El-Fiqi MP, who heads the Planning and Budget Committee in the House of Representatives, recently said that the committee will discuss a new cigarette taxation law at the beginning of the fourth legislative session in October.

     According to Eastern Co., Egyptians spent EGP17 billion ($550.15 million) cigarettes during the 2021-2022 fiscal year.

  • Industry Mourns Tommy Bunn

    Industry Mourns Tommy Bunn

    Photo: New Africa

    Jessie Thomas “Tommy” Bunn, a distinguished leader in U.S. national and state level agricultural policy and marketing and the husband of North Carolina Secretary of State Elaine F. Marshall, passed away unexpectedly July 24 after suffering a traumatic brain event, the North Carolina Department of the Secretary of State reported.

    A native of Zebulon, North Carolina, Bunn formerly served as president of the U.S. Tobacco Cooperative following a 21-year career as executive vice-president of the Leaf Tobacco Exporters Association and Tobacco Association of the United States.

    In addition, he served as deputy director and acting director of the Agricultural Marketing Service Tobacco Division for the U.S. Department of Agriculture in Washington, D.C. and served under Commissioner Jim Graham with the N.C. Department of Agriculture and Consumer Services.

    At the time of his death, he was serving as a consultant to the tobacco industry.

    Bunn was named by the North Carolina State Grange as Man of the Year in 1988 and was honored as a Distinguished Alumni with the College of Agriculture and Life Sciences at N.C. State University in 2012, where he graduated with a degree in Agriculture Business/Crop Science in 1966.

  • Vuse Debuts in Korea

    Vuse Debuts in Korea

    Image: Korea Herald

    BAT Rothmans, the Korean unit of BAT, debuted Vuse 800 in Korea, marking the first launch in Asia, according to The Korea Herald.

    The battery-powered e-liquid cigarette product allows up to 800 puffs without charging. There are four flavor options available.

    In the U.S., Vuse accounts for nearly half the market.

  • Derek Yach

    Derek Yach

    A global health expert and anti-smoking advocate for more than 30 years, Derek Yach is the owner of Global Health Strategies. Previously, Yach was the director of the Foundation for a Smoke-Free World and a World Health Organization cabinet director and executive director for noncommunicable diseases and mental health. He was deeply involved with the development of the Framework Convention on Tobacco Control. On this page we feature a selection of Yach’s contributions to Tobacco Reporter.

  • Cheryl Olson

    Cheryl Olson

    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. In this section we feature a selection of Olson’s contributions to Tobacco Reporter

    PMI Launches Airport-Exclusive IQOS

    PMI debuted the brand in Japan, and has since expanded to selected airports across Europe, as well as South Korea, Morocco, Lebanon, Malaysia, and more.

  • Clive Bates

    Clive Bates

    Clive Bates is the director of Counterfactual Consulting and the former director of Action on Smoking and Health (U.K.). On this page we feature a selection of his contributions to Tobacco Reporter.

    PMI Launches Airport-Exclusive IQOS

    PMI debuted the brand in Japan, and has since expanded to selected airports across Europe, as well as South Korea, Morocco, Lebanon, Malaysia, and more.

  • Minister Expresses Support for Tobacco at ITGA Meeting

    Minister Expresses Support for Tobacco at ITGA Meeting

    Photo: Taco Tuinstra

    Zimbabwe’s minister of agriculture, Anxious Masuka, opened the International Tobacco Growers Association’s (ITGA) 2023 Africa regional meeting June-28-29 expressing strong support for the tobacco sector

    Growers’ representatives from four of the leading tobacco producing markets in Africa—Malawi, Tanzania, Zambia, and Zimbabwe—gathered in Harare to debate the challenges and opportunities facing their sector. Participants requested the support of their governments in the face of multiple threats affecting tobacco production, which brings considerable socioeconomic benefits to the region. Among other topics, they discussed growers’ sustainability efforts and the situation of in their respective markets.

    Highlighting the central role of tobacco growing in Zimbabwe’s economy, Masuka provided details about the country’s Tobacco Value Chain Transformation Plan, which is supposed to increase value addition of the crop and improve local earnings (also see “The Man Behind the Plan,” Tobacco Reporter, May 2023). Masuka aims at record volumes, record earnings and record average prices for tobacco growers. He stated that the actions of the World Health Organization Framework Convention on Tobacco Control (FCTC) are “ill-informed and ill-timed.” “Tobacco in Zimbabwe is an important crop and we are not making any apologies about it,” said Masuka.

    Ryan Swales, the president of Zimbabwe Tobacco Association (ZTA), highlighted the important opportunity presented by the meeting in debating the regional and national issues, given the specific challenges attached to the market, predominantly in sustainability.

    Governments need to look at farmers as their main strategic partners and support their efforts.

    Jose J. Aranda, president, ITGA

    ITGA’s President Jose J. Aranda called on governments to support growers in their sustainable tobacco production efforts as the livelihoods of millions of people around the world depend on it. Tobacco growing, he said, brings valuable contributions to local economies in the form of labor, income, and further opportunities for growth. Aranda also emphasized that tobacco growers operate within a legal framework. “Governments need to look at farmers as their main strategic partners and support their efforts.”

    During the Open Session, participants were able to follow presentations about the current developments in the global leaf market, with focus on African production and pricing, the outlook of the regulatory environment and possible implications for growers, along with a detailed analysis of the ITGA 2023 Market Survey, which highlights the economic, social and environmental challenges for growers in all leading tobacco growing areas. Finally, there were two comprehensive debate sessions with key stakeholders in the four represented markets discussing sustainable tobacco productions and the efforts made to overcome the pressing challenges of the region—cost of production, deforestation, climate change, poverty and lack of opportunities for the youth.

    The ITGA also highlighted its World Understanding Tobacco Farming Day campaign. Aranda urged the sector to work together against the demonization of tobacco growing. ITGA is raising awareness about the realities of tobacco farming to stop the unfounded claims by the WHO FCTC in their World No Tobacco Day.

  • Topower Brings More Puffs and Better Battery

    Topower Brings More Puffs and Better Battery

    A new disposable vape battery solution was showcased during the World Vape Show Dubai, held from June 21-23.
    The pioneering power technology developed by FEELM, a subsidiary of the world’s largest atomization technology company Smoore, is intended for markets that allow higher puff counts and has been designed to increase the endurance of single-use devices.

    When compared to mainstream batteries, the new Topower offers 30 percent more capacity with the battery size remaining unchanged and can deliver over 6,000 puffs without needing to be recharged.

    Topower also provides a constant power output that reduces the loss of taste caused by voltage drop.

    FEELM says the new innovation also boasts the “longest shelf life in the industry,” according to a press release, promising just 1 percent power attenuation over six months and 3 percent over a year – which the brand says is 1/10th the level seen in traditional batteries.
    “This is our new battery technology customized for higher puff disposable vape, with large puff vaping without charging, ultimate-low discharge, ultimate-high energy density,” said Rex Zhang assistant president of FEELM. “The end goal for our industry is to create a smoke-free future and unburden adults from the harms of deadly cigarettes – technology is going to play a leading role in achieving this.”

    Zhang said the no-charge element of Topower was beneficial not just for brands, but for consumers as well. He said the battery solution eradicates the need for additional charging cables, which eliminates the necessity for internal charging devices and consequently saves on production costs.

    He also said consumers would no longer need to “worry about when and where they could next plug their disposable, which can reduce user anxieties and create a more convenient vaping experience,” according to the release.

    Topower has been incorporated into two solutions – FEELM Max’s ceramic coil disposable solution and Power Alpha‘s mesh coil solution.

    FEELM Max and Power Alpha have already been extensively commercialized and have achieved considerable success in multiple countries.

  • Sampoerna Sales Up 12.5 Percent

    Sampoerna Sales Up 12.5 Percent

    Photo: Taco Tuinstra

    Sampoerna reported net sales of IDR111.2 trillion ($7.38 billion) in 2022, up 12.5 percent from the previous year. Sales volume at the Indonesian cigarette manufacturer increased 4.8 percent to 86.8 billion units, bolstered by the performance of premium brands such as Sampoerna A, Dji Sam Soe and Marlboro.

    “The combination of Covid-19 with the impact of the double-digit excise tax increases and widening excise tax gaps has resulted in major challenges for the tobacco industry but Sampoerna remained focused on creating values for its stakeholders, Sampoerna President Director Vassilis Gkatzelis told shareholders at the company’s annual general meeting.

    “We evolved our strategy in a forward-looking way and delivered a robust topline performance in 2022 with year-on-year volume growth and stabilization of market share despite the headwinds and accelerated downtrading to the lower-taxed Below Volume Tier 1 segment.

    “We also reached a critical strategic milestone with our smoke-free products manufacturing facility in Karawang with an investment valued at more than $186 million, which started operations in the fourth quarter of 2022 to fulfill demands both for the domestic market and Asia Pacific.”

    Gkatzelis attributed Sampoerna’s 2022 performance to solid business fundamentals, robust route to market and resilient organization. Although the company’s profitability decreased on a yearly basis and is still significantly lower versus the pre-pandemic levels, key profitability metrics improved during the second half of 2022, both sequentially versus the first half and the year before, driven by returning to net positive pricing as of the third quarter of 2022.

    The positive momentum continued in the first quarter of 2023 with IDR27 trillion in net revenues and IDR2.2 trillion in net profit, up by 3.1 percent and by 12.8 percent, respectively, compared to the same period last year. In this first quarter of 2023, Sampoerna grew its market share to 28.5 percent, up 0.2 percentage points compared to the comparable 2022 quarter.

    Vassilis praised the Indonesian government for providing business certainty through the issuance of a multi-year tobacco products excise policy for 2023-2024. “We certainly wish the government issues future policies that can support the sustainability of the tobacco industry and enable economic recovery to pre-pandemic levels,” he said in a statement.

    According to Vassilis, a predictable environment is key when it comes to delivering sustainable value creation for the broader ecosystem, especially for long-standing investors in Indonesia.

    “I am proud to share that early this year Sampoerna completed its investment in building a production facility for the innovative smoke-free tobacco products in Karawang, West Java,” he said.

    “Additionally, we recently launched the latest technology and innovation of smoke-free tobacco products, namely IQOS ILUMA, through the continuation of IQOS Club with a limited launch in 10 major cities in Indonesia. These are key milestones to mark Sampoerna’s 110 years of presence in the country.”

    Indonesia’s facility for heated tobacco sticks is PMI’s first in Southeast Asia and the seventh globally. “Sampoerna’s investment is a vote of confidence in the investment climate of Indonesia,” said Vassilis. “The new factory in Karawang entails further value creation by increasing research capacity, absorbing high-skilled workers, purchasing local tobacco supplies, operating digital service centers, improving export performance and empowering MSMEs [micro, small and medium-sized enterprises] which includes digitalization support and increasing the capacity of traditional retailers,” said Vassilis.

  • North Carolina Revenue Department Disputes Philip Morris in Tax Litigation

    North Carolina Revenue Department Disputes Philip Morris in Tax Litigation

    Image: andreykr | Adobe Stock

    Philip Morris is engaged in a legal battle with the North Carolina Department of Revenue over an $8.7 million tax bill, reports The Carolina Journal. Philip Morris argues that it should be able to claim $7.2 million in tax credits, but the department disagrees.

    The dispute centers on the interpretation of a phrase in the state law, with Philip Morris claiming that the law does not limit the amount of credit that can be generated in a given year. The revenue department argues that Philip Morris exceeded the $6 million cap on credits and improperly carried them forward to subsequent tax returns.

    “Philip Morris argues the decision in the case will be determined by the meaning of the phrase ‘credit allowed’ found in N.C. Gen. Stat. § 105-130.45. However, this case is about the meaning of six words added to N.C. Gen. Stat. § 105-130.45(b) during a special session convened by the General Assembly,” according to a brief filed by N.C. Department of Justice lawyers. They represent the Department of Revenue in the tax dispute.

    “The words ‘may not exceed 6 million dollars’ specifically limited the amount of credits a taxpayer could generate on the exportation of cigarettes,” state lawyers wrote. “The amendment did not disturb the separate and preexisting cap on the amount of credits that a taxpayer could use on its tax return during a single year in subsection (c). Despite a plain reading of the amended language, Philip Morris contends that subsection (b) does not limit the amount of credit that can be generated in any given year and only limits the amount that can be claimed in a tax year. Thus, Philip Morris continued to incorrectly generate credits in excess of the $6 million cap.”

    “For tax years 2005, 2006 and 2007, Philip Morris calculated its export credits generated in the amount of $28,767,799; $27,374,957; and $14,310,414, respectively, far exceeding the $6,000,000 limit,” according to the brief. “Philip Morris then improperly attempted to carry forward the unauthorized credits to its 2013 and 2014 corporate tax returns.”

    “Through this appeal, Philip Morris now continues to lobby for better treatment than its competitor R.J. Reynolds by attempting to question the statutory construction of an unambiguous statute,” the revenue department’s lawyers argued.

    Philip Morris argues that the department’s interpretation of the law is a recent development and not supported by legislative history.

    The state Supreme Court is yet to issue a ruling in the case.