The tobacco industry took a hit during the pandemic where people had to abstain from consuming products that could cause respiratory problems. The R&D within tobacco products with fewer intoxicants has attracted a large number of new consumers. Although there are many advancements, the death rate is alarming. The loyal customers of these products have a number of problems which are covered under the stats below.
General Overview of the tobacco industry
1. The global tobacco market reached a volume of 8.54 Million Tons in 2020.
2. IMARC Group expects the market to reach a volume of 9.29 Million Tons by 2026
3. Tobacco products are prepared by curing the leaves of the tobacco plant which is a part of the genus Nicotiana of the Solanaceae family
4. There are more than 70 species of tobacco known till now, however, N. tabacum remains the chief commercial crop
5. Tobacco contains a colorless volatile alkaloid, nicotine, which is responsible for stimulating brain functions, increasing blood pressure, constricting peripheral blood vessels, and raising heart rate
6. Dried tobacco leaves are majorly used for smoking in cigarettes, cigars, pipes, and shisha; and as chewing tobacco, snuff, snus, and dipping tobacco.
7. The demand for tobacco has recently witnessed a shift from the developed regions to developing nations such as Asia and Africa
8. It can be accredited to the increasing population, elevating income levels of the consumers, and lenient government regulations.
9. Numerous premium tobacco products such as flavored, long and skinny, colored, and e-cigarettes by the manufacturers have further created a positive outlook for the growth of the tobacco market.
10. A surge in investments in research and development has resulted in the introduction of products with reduced levels of toxicants.
11. Higher levels of education along with rising awareness about health concerns related to tobacco consumption such as different types of cancers, cardiovascular diseases, pulmonary diseases, etc., have hampered the growth of the market.
12. This has helped in attracting a larger consumer base for tobacco products.
13. Stringent regulations in developed countries further restrict market growth.
14. In 2019, the largest tobacco companies spent $8.2 billion on marketing cigarettes and smokeless tobacco in the United States
15. About $22.5 million each day, or nearly $1 million every hour.
16. Cigarette advertising and promotional expenses totaled about $7.62 billion in 2019—a decrease from 2018.
17. Manufacturers spent a total of $576.1 million on smokeless tobacco advertising and promotion during 2019—a decrease from 2018.
18. Although U.S. tobacco production has decreased significantly since the 1980s (from nearly 180,000 tobacco-growing farms to about 10,000 in 2012), the United States continues to be a leading producer of tobacco leaves.
19. Farms in the United States harvested more than 533 million pounds of tobacco in 2018.
20. In 2018, two states–North Carolina and Kentucky–accounted for more than 70% of total tobacco cultivation.
21. Smoking-related illnesses in the United States costs more than $300 billion each year.
22. More than $225 billion for direct medical care for adults.
23. More than $156 billion in lost productivity, including $5.6 billion in lost productivity due to secondhand smoke exposure.
24. Increasing the price of tobacco products is the single most effective way to reduce consumption.
25. A 10% increase in price has been estimated to reduce overall cigarette consumption by 3–5%.13.
26. Research on cigarette consumption suggests that both youth and young adults are two to three times more likely to respond to increases in price than adults.
27. Lower-income populations are more likely to increase quit attempts or smoke fewer cigarettes in response to price increases, although the desire to quit and successful cessation may not be consistent across all racial/ethnic groups.
28. Smokeless tobacco products include dry snuff, moist snuff, plug/twist, loose-leaf chewing tobacco, snus, and dissolvable products.
29. In poorer countries, up to 30% of income is spent on tobacco, reducing funds available for nutrition, education, and health care.
30. In the United States, each pack of cigarettes sold costs society an estimated $18.05.
31. Consumption of tobacco products is increasing globally, though it is decreasing in some high-income and upper-middle-income countries.
32. Tobacco kills up to 50% of its users.
33. There is the immense growth potential of the tobacco and cigarettes industry in its economic dimensions and related opportunities.
34. Over the past few years, the popularity of growing partying and pubbing culture among millennials and working-class populations has propelled the demand for various flavored and unflavored cigarettes across the globe.
35. Emerging economies such as India, Thailand, and China are witnessing a decent rise in cigarette demand due to rising youngsters in these countries.
36. The COVID-19 pandemic has had a substantial negative impact on the tobacco industry owing to the nature of the disease.
37. Any smokeless and smoke products are receiving negative attention due to their associated health risks.
38. The Middle East and Africa region are anticipated to be the fastest-growing regional market with a CAGR of 3.0% from 2021 to 2028.
39. A surge in the number of adults who had ever tried electronic cigarettes has been observed along with this.
40. Companies have been creating new products to keep up with millennials’ changing demands and generation Z.
41. The U.S., it is seen that the adoption of electronic cigarettes has been increased by 1650% among school students from 2011 to 2019.
42. The next-generation tobacco products segment is anticipated to be the fastest-growing segment with a CAGR of 2.8% from 2021 to 2028.
43 The North American market is gaining momentum and is anticipated to witness promising growth in the demand for next-generation products owing to the increasing consumer disposable income, rising number of product launches, and the availability of superior-quality products.
44. Expected to expand at a compound annual growth rate (CAGR) of 1.8% from 2021 to 2028.
45. It has been observed that the number of smokers has been rising at the global level.
46. The industry participants are targeting the consumers by launching flavored cigarettes, which are popular among consumers, particularly youth and millennials.
47. The market is consolidated in nature and is characterized by various well-established players and several small and medium players
48. Major players in the market adopt several strategies, including mergers & acquisitions, collaborations, product launches, and expansion of distribution channels, to capture a significant market share and expand their customer base across the globe.
49. Revenue forecast in 2028 USD 1,073.79 billion.
50. Egyptian adolescents make a significant proportion of this consumer segment.
Data on Indian tobacco Industry
1. Tobacco in India was introduced by the Portuguese in the 17th century, is appreciated worldwide for its rich, full-bodied flavor and smoothness.
2. Total export of tobacco and manufactured tobacco substitutes stood at US$ 904.87 million in FY20. Indian tobacco is exported to around 100 countries.
3. In FY21, the export of unmanufactured tobacco stood at US$ 423.3 million.
4. The total export of Flue-Cured Virginia (FCV) tobacco in January 2021, was US$ 19.5 million, while for a period from April to January 2021, it was US$ 303.7 million.
5. The tobacco export in March 2021, was US$ 85.52 million and the total export from April 2020 to March 2021 was US$ 875.09 million.
6. In April 2021, the export of tobacco stood at US$ 72.97 million.
7. The panel proposed the establishment of tobacco farms dedicated to exports only to improve outward shipments and to provide benefits to farmers
8. The Tobacco Board of India is a facilitator for tobacco growers, traders, and exporters
9. India is the second-largest tobacco producer and exporter in the world.
10. India exports unmanufactured tobacco primarily to Belgium, Korea, Nigeria, Egypt, and Nepal.
Segmentation on the Basis of Types and Usage
1. Cigarettes represent the most popular product type, accounting for the majority of the global market.
2. Roll Your Own
5. Smokeless Tobacco
1. China enjoys the leading position in the global tobacco market due to an increase in the production of tobacco leaves in the region
4. United States
5. EU 15
Some of the leading players operating in the tobacco market are
1. China National Tobacco Corporation
2. Phillip Morris International
3. British America Tobacco
4. Japan Tobacco International
5. Imperial Tobacco Group
The tobacco industry certainly has some popular products that are imported from countries like Cuba (Cigars) and Poland (Cigarettes). The high consumption of these products can be due to the tough lifestyles among the adults and a means to seek relief. Certain advancements and awareness about the consequences of this industry can help people live a healthy lifestyle.