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  • C-Stores Campaign Against Age Bans

    C-Stores Campaign Against Age Bans

    Credit: Daniel

    The New England Convenience Store and Energy Marketers Association (NECSEMA) has launched a grassroots campaign this week to oppose generational bans on tobacco and nicotine products.

    The Stoughton, Massachusetts-based association stated that the ban on tobacco sales tied to birthdate threatens civil liberties in Massachusetts. They believe that if unopposed, it could lead to local bans on various other products including gambling, alcohol, cannabis, sugary drinks, fatty foods, and caffeine.

    Alex Weatherall, NECSEMA president, stated that these policies are establishing a concerning precedent by giving local boards of health the unilateral authority to determine if an individual is “adult enough” to purchase legal products statewide and nationwide, according to media reports.

    Weatherall believes that this sets a dangerous precedent, adding that local officials are imposing their morality on citizens of the Commonwealth. NECSEMA said it created the advocacy group Citizens for Adult Choice to educate the public about the dangers these local bans pose for law-abiding adults in Massachusetts.

  • Universal Income Up

    Universal Income Up

    Photo: Taco Tuinstra

    Universal Corp. reported sales and other operating revenue of $2.75 billion in fiscal year 2024, up 7 percent over that recorded in 2023. Operating income grew 23 percent to $222 million. The company’s tobacco operations contributed sales and operating revenues of $2.44 billion, $180.5 million more than in 2023.

    “Universal Corp. had a positive finish to a strong fiscal year 2024 with notable financial and operational performance in both the fiscal year and quarter ended March 31, 2024,” said chairman, President and CEO George C. Freeman III in a statement.

    “Fiscal year 2024 was an exceptional year for our tobacco business, as a favorable product mix, strong customer demand and the sale of larger crops in Africa, compared to fiscal year 2023, drove our strong operating results. Fiscal year 2024 was also a significant building year for our ingredients business.”

    While expecting leaf tobacco supply and demand to return to a more balanced position over time, Freeman said tobacco supply remains tight and green tobacco prices elevated. “We continue to leverage our diverse global footprint and financial flexibility to manage these conditions and to execute our tobacco strategies,” he said.

    “For example, during the fourth quarter of fiscal year 2024 and into the first quarter of fiscal year 2025, we accelerated buying in Brazil to ensure access to the tobacco we need for our customers [also see “The Great Scramble,” Tobacco Reporter, May 2024].

    “This accelerated buying, combined with higher green tobacco prices, resulted in increased use of working capital and higher debt levels at March 31, 2024. We expect most of the net impact on working capital from our accelerated buying strategy to naturally unwind over the next two years.”

  • Unforeseen Costs

    Unforeseen Costs

    Image: Alexandr Byerdugin

    How the Florida e-cigarette registry will harm nonvapers

    By Peter Clark

    This year, many U.S. states have considered imposing heavy-handed registries that aim to ban most vaping products sold today. In Florida, Governor Ron DeSantis wisely refused to follow along with other states. However, his solution—a sort of reverse registry that gives Florida’s attorney general the authority to ban specific products—will create more problems than it solves.

    It’s understandable how many nonvapers would see this law as being reasonable. But there are many unforeseen costs that they will need to bear.

    This law focuses on the dangers of vaping devices attractive to children, but there are many drawbacks to nonvapers. These include state resources wasted on ligation, unfair benefits to tobacco companies and healthcare costs of smokers imposed on all Floridians. 

    HB1007 will run into legal trouble if not correctly applied. Multiple factors need to be satisfied for a vaping product to be restricted. If Attorney General Moody erroneously finds a vaping device to be illegal, this opens Florida up to lawsuits. 

    This impacts Floridians since it costs tax dollars and ties up the court system. The Florida court system is already stressed. Between March 2022–2023, Florida led the country in the number of lawsuits filed. 

    Plus, the courts would require additional tax revenue to adjudicate the influx of claims. Fiscal year 2023 already saw a 7.2 percent increase in the budget over 2022. That budget has soared to $114.7 billion for fiscal 2024–2025. 

    The government should have a compelling interest in restricting sales of e-cigarettes. The public health justification is flimsy at best. 

    Teen vaping is on the decline. It isn’t flavored products that entice kids to start vaping. They vape to rebel and to reduce stress, using nicotine to self-medicate. Targeting flavored electronic nicotine-delivery systems (ENDs) based on a myth theorizing why kids start vaping will jeopardize the health of adult vapers, leaving us with an ineffective policy that burns tax dollars and overloads the courts.

    HB1007 also advantages the tobacco companies. The influx of non-FDA-approved e-cigarettes has severely eaten into the market share of big tobacco. Analysts suggest the only way to remedy slumping cigarette sales would be to “clamp down on disposable e-cig growth.” The CEO of Altria has even described the market as being “overrun” by these devices. 

    Barring vapes that lack FDA approval benefits tobacco companies in two ways. For one, most of the products granted premarket approval were Big Tobacco-owned. In 2022, all the e-cigarettes greenlighted by the FDA were sold by R.J. Reynolds, Altria, and JTI. By the attorney general blocking Big Tobacco’s competition, they can regain some of the sales lost to popular single-use devices like Elfbar.

    Even Florida voters who don’t vape should be concerned about this outcome. Upholding this law gives precedence to similar approval processes for other products. The legislature could pass additional laws to ban the sale of dietary supplements and even food deemed to be harmful. Much like the choice to vape, adults should have the right to evaluate the harm in what they choose to consume for themselves. 

    Florida restricting single-use ENDs would impose higher healthcare costs on Floridians. A study found that only 12.9 percent of vapers polled would abstain from nicotine if their preferred e-cigarette was banned, leaving many e-cigarette users going back to tobacco. The total healthcare cost to Florida from smoking is $10.04 billion, an annual tax burden of $854 per household. These figures do not include the impact of secondhand smoke or the $21.1 billion in lost productivity. 

    If a policy doesn’t directly impact you, it is easy to be apathetic. Banning popular vaping products hurts more than e-cigarette users. It wastes resources, gives tobacco companies an unfair advantage and costs Florida billions in healthcare costs. Even if you have never picked up a cigarette or vape, this law will still negatively impact you.

    Peter Clark is a fellow with the World Vapers’ Alliance. You can follow him on X at @blog_logic.
  • U.S. States Report Zyn Shortages

    U.S. States Report Zyn Shortages

    TR Archive

    Zyn nicotine pouches are out of stock at multiple retailers that ship across the U.S., and some wholesalers are also reporting difficulty getting the product.

    Some smoke shops in New York said they are out of the pouches, and wholesalers in New Jersey and Florida said they’ve been hard to get, Bloomberg reported.

    The scarcity comes after Philip Morris International reported that U.S. volumes of the nicotine pouches jumped 80 percent in the first quarter.

    There’s also a lawsuit about the products’ nicotine content and growing criticism of marketing practices, raising concern that there could be a regulatory crackdown on the popular cigarette alternative.

    Zyn is an important source of growth for Philip Morris International as cigarette smoking declines and the vape industry is increasingly dominated by unauthorized products made in China.

    In an earnings call last month, Chief Financial Officer Emmanuel Babeau acknowledged Zyn’s growth was straining the supply chain.

    In February, PMI reported that it had shipped nearly 385 million cans of the flavored nicotine pouches in the U.S. in 2023, up 62 percent year-over-year.

    The firm expects to do even better business in 2024, forecasting U.S. shipments of around 520 million cans this year, its February earnings report said.

  • Northern Ireland to Adopt Generational Ban

    Northern Ireland to Adopt Generational Ban

    Stormont (Credit: Vivacity Images)

    Northern Ireland will participate in the U.K. generational tobacco ban.

    The U.K. Tobacco and Vapes Bill aims to phase out the sale of cigarettes. It would make it illegal to sell tobacco products to anyone born on or after Jan. 1, 2009, after they turn 18.

    It would also provide powers to address vaping among young people. The bill is part of the U.K. government’s plan for a “smoke-free generation,” according to the BBC.

    The Northern Ireland Assembly endorsed a legislative consent motion on May 21 to allow the bill to apply to Northern Ireland.

    Northern Ireland Health Minister Robin Swann said the bill aims to “stop people from ever starting to smoke, thus preventing a lifetime of addiction.” He dismissed arguments that the legislation is “nanny statism” and would deny people “freedom of choice.”

    On vapes, he said the bill includes regulation-making powers to allow for future restrictions on vape flavors, packaging and point-of-sale displays. The bill is progressing through Parliament despite opposition from several leading Tory figures.

  • PMI Acquires Minority Stake in Eastern Co.

    PMI Acquires Minority Stake in Eastern Co.

    Photo: artmim

    Philip Morris International has acquired 14.7 percent of Eastern Co., reports Egypt Today.

    PMI and Eastern reportedly seek to explore potential strategic areas for collaboration in technology, manufacturing and innovation.

    “We look forward to exploring potential areas of cooperation with Eastern, including opportunities to provide adult smokers in Egypt with better options than cigarettes,” said Fred de Wilde, PMI president for South and Southeast Asia, the Commonwealth of Independent States and the Middle East and Africa, in a statement.

    In November, Global Investment Holdings, an investment firm based in the United Arab Emirates, paid EGP16.4 billion ($531.6 million) for 669 million shares in Eastern Co.

    Eastern Co.’s primary shareholders include the state-owned Holding Company for Chemical Industries (20.9 percent), the Allan Gray Equity Fund (7.2 percent) and the shareholders union of the Eastern Co. (6 percent), with the remaining 36 percent of shares trading freely on the stock exchange.

    Egypt has been selling stakes in 35 state-owned companies through offering shares to strategic investors.

    Eastern Co. is Egypt’s largest cigarette manufacturer, with a portfolio that also includes cigars and pipe tobacco, among other products.

  • Food for Thought

    Food for Thought

    (Photos: Stuart Mitchell)

    “You couldn’t make it up.” That was how Simon Clark, the director of the Freedom Organization for the Right to Enjoy Smoking Tobacco (Forest), summed up the way in which the U.K. government had, in October last year, renegued on earlier assurances and announced a generational ban on tobacco sales.

    Clark was speaking as co-host of a Beat the Ban lunch held at the Boisdale Restaurant in London on May 21. The proposed ban, currently being pushed through parliament, would make it illegal in the U.K. to sell tobacco products to anyone born on or after Jan. 1, 2009.

    Clark pointed out that this would mean a person of a certain age would be able to buy tobacco while another person, one year, or, in some cases, just one day younger, would not be able to do so legally. Eventually, a person 70 years of age would not be able to buy tobacco legally.

    Forest is opposed to the proposed ban for several reasons, but mainly because it believes the ban would infantilize young adults and increasingly older adults, driving some of them towards the black market and criminal gangs, while doing nothing to stop sales of tobacco products to children, which are already illegal.

    What was extraordinary, Clark said, was that while, in April 2023, the government had made it clear it did not intend to raise the minimum age for the sale of tobacco, in October, the prime minister, Rishi Sunak, announced plans for the generational ban.

    “In our view, the Tobacco and Vapes Bill is a desperate attempt by a desperate prime minister to leave a legacy—any legacy—however unconservative, before the next general election [due to be held this year or, at the latest, January 2025],” said Clark.

    Clark was scathing, too, about the way the bill is being “steamrollered” through parliament. Following a short public consultation before Christmas, the government had announced it would not consider any submissions from groups with links to the tobacco industry, which, for instance, included Forest and even retailers. “To the best of my knowledge, that has never happened before,” he added.

    After its second reading, the bill entered its committee stage, when 17 MPs were appointed to the Committee, 16 of whom had voted for the bill and the other of whom was known to support it. And when it came to inviting people to give oral evidence to the Committee, witnesses were almost exclusively supporters of the bill.

    “Not only has the process been absolutely scandalous, the bill as it stands is illiberal, unenforceable, and has significant unintended consequences,” said Clark. “It will drive the legitimate sale of cigarettes and tobacco underground,” he added, before calling on those so minded to write to their MPs in protest,

    Clark’s co-host, Ranald Macdonald, the founder and MD of the Boisdale restaurants, was unable to attend the lunch but sent a message of support along with a special pleading for the smokers of fine cigars.

    And the 60 lunch guests, who included MPs, parliamentary researchers, think tank staff, retailers, tobacco industry representatives and journalists, heard from a string of speakers representing or simply speaking up for retailers, young adults and a variety of tobacco products, including pipe tobacco and snuff that will also be covered by the bill should it go through. —George Gay

    Editors’s note:

    Hours after this story had been submitted, U.K. Prime Minister Rishi Sunak announced that a general election would be held on July 4, meaning that parliament was due to be dissolved on May 30 and leaving too little time for the tobacco and vapes bill to complete its passage through parliament. This is unlikely to be the end of the matter, however, because the policy underpinning the bill had cross-party support and could well arise like the phoenix in the future.

    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.
  • Prices Slow Tobacco Consumption: Study

    Prices Slow Tobacco Consumption: Study

    Photo: Taco Tuinstra

    Cigarette sales in Pakistan dropped 18 percent following a price hike, reports The Nation citing a recent survey from Islamabad’s Centre for Research and Dialogue (CRD).  

    Pakistan’s total consumption, which includes taxed, smuggled and untaxed products, ranges from 72 billion sticks to 80 billion sticks annually.

    “Pakistan has a long way to go in tobacco taxation,” said Maryam Gul Tahir, director of the CRD, noting that Pakistan has some of the world’s cheapest cigarettes. “Public health must be prioritized over industry interests.”

    The World Bank recommends a uniform tax structure for all tobacco products to reduce consumption further and increase government revenue.

  • Digital Tobacco Platform Launched

    Digital Tobacco Platform Launched

    Photo: Taco Tuinstra

    ModernLeaf AI has launched a digital platform offering artificial intelligence solutions to increase productivity for Zimbabwe’s tobacco growers and exporters across the value chain, reports the Zimbabwe Independent.

    “Looking beyond Zimbabwe envisions opportunities to expand the platform’s usage across Africa, signaling the need for investment in this ambitious endeavor,” said Takudzwa Sambo, founder of ModernLeaf AI. “ModernLeaf AI is poised to play a pivotal role in advancing the tobacco industry on the continent.”

    “With cutting-edge AI technology, ModernLeaf AI empowers you with precision crop monitoring, advanced predictive analysis, early disease detection, premium quality control updates, strategic market insights, cost-efficient solutions, export strategy and compliance in international markets, [and] tobacco business intelligence in over 120 countries,” said Sambo.

    Sambo emphasized that leveraging AI to propel Zimbabwe’s tobacco sector onward is a necessity. “I am grateful to the government for its vision outlined in Vision 2030, emphasizing the importance of youth involvement in realizing the strategic goals set forth in the National Development Strategy 1.”

  • Activists Urged to Cite Human Rights

    Activists Urged to Cite Human Rights

    Photo: utah51

    Action on Smoking and Health (ASH) and Unfairtobacco released a joint report detailing how they believe the industry harms children. Titled Protecting Children From the Tobacco Industry, the report also explains how advocates can use global human rights standards and tools against the tobacco industry.

    “Our children deserve to grow up in a world free from the damage, disease and death caused by the tobacco industry,” said Laurent Huber, executive director of ASH, in a statement.

    “Every day, tobacco companies are violating children’s right to health, right to a healthy environment and right to be free from racial discrimination. Governments have a duty to protect those basic human rights, and we will stand together with our partners to ensure all children’s rights are upheld.”

    According to the report’s authors, human rights mechanisms, such as the Convention on the Rights of the Child, can help protect children and youth from the tobacco industry.

    “Human rights mechanisms are a tool to protect children from the harms of the tobacco industry, including health and environmental damages. Public health advocates can and should use these mechanisms to fight for a healthier world for our children,” said ASH Managing Attorney Kelsey Romeo-Stuppy.