Tobacco Market

According to Stratistics MRC, the Global Tobacco Market is accounted for $310.3 billion in 2022 and is expected to reach $452.8 billion by 2028 growing at a CAGR of 6.5% during the forecast period. Native to the Americas, tobacco was formerly among the most significant crops raised by American farmers. It is one of the most commonly used substances in the world. Any plant in the genus Nicotiana, particularly the native tropical American Nicotiana tabacum, is referred to as tobacco. These plants are widely cultivated for their leaves, which are dried and processed primarily for use in pipes, cigarettes, and cigars. In addition, it is crushed to make snuff, dipping tobacco, and other unique preparations. It is also sliced to produce chewing tobacco. The demand has been sustained by the rising smoking rates in Asia and Africa's developing nations.

According to Center for Disease Control and Prevention, national public health agency, in 2019, approximately 14 of every 100 adults aged 18 years or older in the U.S smoked cigarettes. This means nearly 34.1 million adults in the United States smoke cigarettes.



Market Dynamics:

Driver:

People's tendency to use tobacco products

In the projected period, the market for tobacco is anticipated to be driven by rising millennial usage of tobacco products such as cigarettes, cigars, and oral nicotine due to societal influence, anxiety, depression, and inferiority complexes being prevalent. Oral nicotine use and cigarette smoking are growing increasingly popular. Moreover, many smokers succumb to addiction as a consequence of the impact of their surroundings and circle of friends. It is projected that this aspect will accelerate market expansion in the upcoming years.

Restraint:

Increased health awareness of tobacco's adverse implications to limit the market

In the anticipated time frame, market growth for tobacco goods is projected to be constrained by the adoption of a healthy lifestyle and growing public awareness of the negative effects of tobacco use. To highlight the harmful consequences of tobacco on the consumer's health, non-profit organisations, the government, local authorities, and clubs produce an array of plays, campaigns, advertisements, road shows, and skits. Due to this, a lot of individuals have stopped smoking and using tobacco. As a result, it is predicted that this initiative will negatively impact market growth.

Opportunity:

Growing demand for new tobacco flavours

In the coming years, it is anticipated that ongoing innovation and the launch of new tobacco products and flavours will accelerate market growth. To meet client expectations and create new flavours and textures for tobacco products, tobacco manufacturing businesses invest in their research and development efforts. Also, various new tobacco sales outlets have opened in numerous locations, which is expected to further boost the demand for tobacco products within the anticipated time frame.

Threat:

Smoking of tobacco hindering the market growth

The stimulant nicotine, which is found in tobacco smoke, induces severe chemical and physical dependence. Nicotine is a neurotoxin, a vasoconstrictor, and a type I pesticide. The effects are particularly severe when one inhales cigarette smoke. Several studies have shown that nicotine typically leaves the body in 2–3 days. Physical and psychological problems, however, have a tendency to persist for a longer time. Poisons are found in tobacco. There are around 4000 chemicals in tobacco, 100 of which are recognised carcinogens and 63 of which are known poisons. Most people agree that tobacco's most harmful ingredient is nicotine.

Covid-19 Impact:

Since 2019, the COVID-19 pandemic's prevalence has had an adverse impact on the expansion of the market for tobacco products. The tobacco manufacturers are unable to obtain raw materials for the production of tobacco products because governments throughout the world have imposed stringent restrictions on travel and transportation. Because of this, the market for tobacco products has decreased. The entire closure of a number of businesses and convenience stores has also had a significant impact on tobacco product sales. Due to the closure of various enterprises owing to the outbreak, tobacco product production has also decreased.

The cigar & cigarillos segment is expected to be the largest during the forecast period

The cigar & cigarillos segment is anticipated to have the largest market share in the global market and generate the highest revenue during the forecast period, as this growth is attributable to the manufacturing companies' constant development of novel cigar products with unique flavours like chocolate and clove to attract customers. Also, a number of brand-new cigar stores are scheduled to open in a variety of places, which is anticipated to accelerate the market expansion of the category in the upcoming years.

The paper boxes segment is expected to have the highest CAGR during the forecast period

The segment for paper boxes had the highest CAGR and is anticipated to continue to grow over the projection period. Paper box packaging is becoming more common in the packaging sector. It is gaining popularity in many locations since it is both cost- and environmentally-friendly. Due to increasing concerns about the non-biodegradable nature of plastic and metal packaging, manufacturers strongly favour paper box packaging. For instance, Wisconsin-based packaging company Prairie Industries Holdings has agreed to purchase Sonaco's Europe contract packaging business for $120 million in cash in October 2020. As a result of this purchase, the company was able to enhance its customer offerings.

Region with largest share:

At the highest level, among nations like China and India, Asia-Pacific is one of the world's top producers and users of tobacco. Due to its extensive brand range, nationwide distribution, and market dominance in the Asia Pacific region, the market in this region is expected to dominate the largest market share over the prediction period. ITC is one of the major players in the cigarette industry. As tobacco firms are unable to advertise, the majority of them rely on broad distribution and technological advancements, such as ITC, to maintain sales. The rules in nations like India, for instance, prohibiting the use of tobacco products in public spaces, as well as the increasing accessibility of tobacco products in modern retail stores in the region, are active drivers of the expansion of the Asia-Pacific tobacco market.

Region with highest CAGR:

Due to consumers' busy lives and long work hours, North America is expected to experience the highest growth in the region's cigarette demand over the projection period. This is one of the major factors boosting the demand for cigarettes in the region. Adult pubs and gatherings have recently adopted new trends, making smoking more prevalent because it has become trendy. Additionally, expanding their product offerings and promoting tobacco use in North America are two ways businesses are responding to shifting customer demand.



Key players in the market

Some of the key players in Tobacco market include Imperial Brands, Scandinavian Tobacco Group A/S, British American Tobacco, Altria Group, Inc, China Tobacco, Japan Tobacco Inc., Swedish Match AB, ITC Limited, Swisher, PT Gudang Garam Tbk, KT&G Corp, Philip Morris Products S.A., Eastern Company SAE, VST Industries Ltd, Kothari Products Ltd, Godfrey Phillips India Ltd, Golden Tobacco Company Ltd. and NTC Industries Ltd.

Key Developments:

In February 2022, Reynolds American Inc. - a subsidiary of BAT group and U.S. parent company R.J. Reynolds announced a partnership with the National Association of Convenience Stores (NACS) and Conexxus as a sponsor of TruAge – a new digital solution that helps to enhance the current age-verification system with keeping users privacy at mind.

In July 2021, Japan Tobacco Inc. (JT) declared the official introduction of Ploom X, its next-generation heated tobacco device, on August 17, 2021. Ploom X will steadily be made accessible across Japan, inclusive of convenience stores and chosen tobacco retail stores.

In May 2021, Altria Group Inc. announced to continue its investment in non-combustible tobacco products and acquired the remaining 20% of the Burger Sohne Holdings AG, Oral nicotine pouch global business, for approximately $250 million. Altria entered the oral nicotine pouch category in June 2019 with 80% of Burger Sohne Holdings AG.

Products Covered:
• Cigarettes
• Smokeless
• Cigars & Cigarillos
• Next Generation Products
• Waterpipes
• Kretek
• Snuff
• Non Cigarette Tobacco
• Electronic Cigarette
• Smoking Tobacco
• Raw Tobacco
• Other Products

Types Covered:
• Burley
• Virginia
• Nicotiana rustica
• Oriental
• Other Types

Distribution Channels Covered:
• Store Based Retailing
• Non Store Retailing
• Convenience Stores
• E Commerce Websites
• Specialty Stores
• Supermarket/Hypermarket
• Online Sales Channel
• Offline
• Other Distribution Channels

Packaging Types Covered:
• Paper Box
• Paper
• Jute
• Plastic
• Other Packaging Types

Regions Covered:
• North America
o US
o Canada
o Mexico
• Europe
o Germany
o UK
o Italy
o France
o Spain
o Rest of Europe
• Asia Pacific
o Japan
o China
o India
o Australia
o New Zealand
o South Korea
o Rest of Asia Pacific
• South America
o Argentina
o Brazil
o Chile
o Rest of South America
• Middle East & Africa
o Saudi Arabia
o UAE
o Qatar
o South Africa
o Rest of Middle East & Africa

What our report offers:
- Market share assessments for the regional and country-level segments
- Strategic recommendations for the new entrants
- Covers Market data for the years 2020, 2021, 2022, 2025, and 2028
- Market Trends (Drivers, Constraints, Opportunities, Threats, Challenges, Investment Opportunities, and recommendations)
- Strategic recommendations in key business segments based on the market estimations
- Competitive landscaping mapping the key common trends
- Company profiling with detailed strategies, financials, and recent developments
- Supply chain trends mapping the latest technological advancements

Free Customization Offerings:
All the customers of this report will be entitled to receive one of the following free customization options:
• Company Profiling
o Comprehensive profiling of additional market players (up to 3)
o SWOT Analysis of key players (up to 3)
• Regional Segmentation
o Market estimations, Forecasts and CAGR of any prominent country as per the client's interest (Note: Depends on feasibility check)
• Competitive Benchmarking
Benchmarking of key players based on product portfolio, geographical presence, and strategic alliances