Tobacco in Ukraine
Euromonitor International's Tobacco in Ukraine market report offers a comprehensive guide to the size and shape of the market at a national level. It provides the latest retail sales data, allowing you to identify the sectors driving growth. It identifies the leading companies, the leading brands and offers strategic analysis of key factors influencing the market - be they new product developments, packaging innovations, economic/lifestyle influences, distribution or pricing issues. Forecasts illustrate how the market is set to change.
Get immediate access to strategic market analysis when you buy reports online
Tables: 97 | Publication date: Jan 2008
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive environment
Product coverage
Cigarettes; Cigarettes including RYO; Cigars; Smoking tobacco
Executive summary
The Number of Brand Extensions Increases Significantly
From 2007 no cigarette brands may be labelled as "light". However, the existing stock of "light" brands produced earlier may be sold during the year. As a result, the array of brand extensions in Ukraine has increased significantly: so-called "light" brands have yet to disappear while alternatives are already on offer. In the first half of 2007 over 100 substitute brand extensions were introduced. Most producers used the opportunity to relaunch existing brand extensions; they changed their pack designs and repositioned the substitute offerings as new extensions.
Cigarettes Become More Expensive While Staying Relatively Cheap
In late 2006-early 2007 the price of virtually all cigarette brands increased by 7-10%. This represented the highest price increase in many years. The main reason for the price hike was the increase in personal incomes. On the one hand, more expensive cigarettes have become more affordable for regular Ukrainian smokers; on the other hand labour has become more expensive. Another important reason for the price hike was the rise in energy prices in 2006, as Russia doubled its natural gas price for Ukraine. An increase in tobacco excise tax rates also contributed to increased cigarette prices. In 2006 an amendment to the law increased excise taxes for cigarettes in 2007. The increase in the excise tax for filter cigarettes excise is expected to reach 7-10% per pack in 2007.
The cigarette price hike, however, is not enough to catch up with the general rise in prices. Compared to the two-digit inflation of consumer prices, the rise in cigarette prices is moderate. Cigarettes remain cheap in Ukraine relative to the price of other goods and also relative to cigarette prices in the Western Europe.
The Tobacco Industry Benefits from Political Turmoil in 2006-2007
After the parliamentary election in spring 2006 there was a long and painful process of coalition formation. Shortly after the coalition government had emerged, its members started drawing deputies from non-coalition factions to create a constitutional majority. If such a majority was formed, the coalition could change the constitution and override the President's veto on any law. A number of scandals erupted in connection with the alleged change of factions by deputies in return for bribes. To prevent the parliamentary coalition's power from being usurped the President dissolved Parliament and set an early election for autumn 2007.
The political turmoil of 2006-2007 prevented Ukraine's parliament from changing the tobacco legislation, stalling the government's attempt to form a single policy regarding tobacco. The largest tobacco producers in Ukraine have pointed to the positive effects of legislation stability on the industry.
In 2006 Cigarette Production Grew Insignificantly Due to Overproduction in 2005
In 2006 the volume of cigarettes produced in Ukraine grew very slowly, whereas the previous five years produced double-digit growth rates. The main reason for the low growth recorded in 2006 was overproduction in 2005. Whilst cigarette production was already saturated in 2005, manufacturers increased their production volumes to create a reserve stock in anticipation of adverse legislative changes. In 2006 new legislation failed to produce major changes leaving most expectations unfulfilled.
The Demand for Water Pipe Tobacco Increases Rapidly
The tradition of water pipe smoking is spreading to Ukraine. Water pipes are regularly offered in cafés and bars in Ukraine. Water pipe tobacco is sold not only by tobacconists/specialists, but also in supermarkets/hypermarkets and newsagent-tobacconists/kiosks. Ukrainian importers estimate that volume sales of water pipe tobacco in Ukraine reached 20 tonnes in 2006, with another 20 tonnes sold illegally. Illegal importers generally offer low quality, cheap water pipe tobacco from Egypt. Over the forecast period the demand for water pipe tobacco is likely to continue to growth strongly. Many Ukrainians buy water pipes both at home and abroad.
Table of contents
TOBACCO IN UKRAINE : MARKET INSIGHT
EXECUTIVE SUMMARY
The Number of Brand Extensions Increases Significantly
Cigarettes Become More Expensive While Staying Relatively Cheap
The Tobacco Industry Benefits from Political Turmoil in 2006-2007
In 2006 Cigarette Production Grew Insignificantly Due to Overproduction in 2005
The Demand for Water Pipe Tobacco Increases Rapidly
OPERATING ENVIRONMENT
Smoking Population
Death by Cause
Table 1 Death by Cause 1998-2006
Legislation
Tar
Health Warnings
Duty Paid Packet Marks
Advertising & Sponsorship
Smoking in Public Places
Litigation
Taxation and Duty Levies
Table 2 Taxation and Duty Levies 2001-2007
Summary 1 Proposed Import Tax Rate Changes
Table 3 Tobacco Licence Payments 1995-2001/2002-2007
Table 4 Average Cigarette Pack Price Breakdown: Brand Examples
Production/Imports/Exports
Table 5 Trade Statistics – Cigarettes 2001-2006
The Role and Effect of Cannabis/Marijuana
MARKET INDICATORS
Table 6 Deaths from Heart Disease 2001-2006
Table 7 Deaths from Lung Cancer 2001-2006
Table 8 Illicit Trade Estimate 2001-2006
MARKET DATA
Table 9 Sales of Tobacco by Sector: Volume 2001-2006
Table 10 Sales of Tobacco by Sector: Value 2001-2006
Table 11 Sales of Tobacco by Sector: % Volume Growth 2001-2006
Table 12 Sales of Tobacco by Sector: % Value Growth 2001-2006
Table 13 Sales of Cigarettes by Distribution Format: % Analysis 2001/2006
Table 14 Forecast Sales of Tobacco by Sector: Volume 2006-2011
Table 15 Forecast Sales of Tobacco by Sector: Value 2006-2011
Table 16 Forecast Sales of Tobacco by Sector: % Volume Growth 2006-2011
Table 17 Forecast Sales of Tobacco by Sector: % Value Growth 2006-2011
DEFINITIONS
Sources
Summary 2 Research Sources
LOCAL COMPANY PROFILES - UKRAINE
BAT-PRILUCKY TOBACCO CO JSC - TOBACCO - UKRAINE
STRATEGIC DIRECTION
KEY FACTS
Summary 3 BAT-Prilucky Tobacco Co JSC: Key Facts
Summary 4 BAT-Prilucky Tobacco Co JSC: Operational Indicators 2002-2005
COMPANY BACKGROUND
PRODUCTION BY FACTORY
Summary 5 BAT-Prilucky Tobacco Co JSC: Production Statistics by Factory 2000-2006
COMPETITIVE POSITIONING
Summary 6 BAT-Prilucky Tobacco Co JSC: Competitive Position 2006
JT INTERNATIONAL CO UKRAINE CJSC - TOBACCO - UKRAINE
STRATEGIC DIRECTION
KEY FACTS
Summary 7 JT International Co Ukraine CJSC: Key Facts
Summary 8 JT International Co Ukraine CJSC: Operational Indicators 2002-2005
COMPANY BACKGROUND
PRODUCTION BY FACTORY
Summary 9 JT International Co Ukraine CJSC: Production Statistics by Factory 2000-2006
COMPETITIVE POSITIONING
Summary 10 JT International Co Ukraine CJSC: Competitive Position 2006
LIGGETT-DUCAT UKRAINE - TOBACCO - UKRAINE
STRATEGIC DIRECTION
KEY FACTS
Summary 11 Liggett-Ducat Ukraine: Key Facts
Summary 12 Liggett-Ducat Ukraine: Operational Indicators 2001-2005
COMPANY BACKGROUND
PRODUCTION BY FACTORY
Summary 13 Liggett-Ducat Ukraine: Production Statistics by Factory 2000-2006
COMPETITIVE POSITIONING
Summary 14 Liggett-Ducat Ukraine: Competitive Position 2006
LVIV TOBACCO FACTORY - TOBACCO - UKRAINE
STRATEGIC DIRECTION
KEY FACTS
Summary 15 Lviv Tobacco Factory: Key Facts
Summary 16 Lviv Tobacco Factory: Operational Indicators 2001-2004
COMPANY BACKGROUND
PRODUCTION BY FACTORY
Summary 17 Lviv Tobacco Factory: Production Statistics by Factory 20002-006
COMPETITIVE POSITIONING
Summary 18 Lviv Tobacco Factory: Competitive Position 2005
PHILIP MORRIS UKRAINE AO - TOBACCO - UKRAINE
STRATEGIC DIRECTION
KEY FACTS
Summary 19 Philip Morris Ukraine AO: Key Facts
Summary 20 Philip Morris Ukraine AO: Operational Indicators 2002-2003
COMPANY BACKGROUND
PRODUCTION BY FACTORY
Summary 21 Philip Morris Ukraine AO: Production Statistics by Factory 2000-2006
COMPETITIVE POSITIONING
Summary 22 Philip Morris Ukraine AO: Competitive Position 2006
REEMTSMA UKRAINE - TOBACCO - UKRAINE
STRATEGIC DIRECTION
KEY FACTS
Summary 23 Reemtsma Ukraine: Key Facts
Summary 24 Reemtsma Ukraine: Operational Indicators 2002-2005
COMPANY BACKGROUND
PRODUCTION BY FACTORY
Summary 25 Reemtsma Ukraine: Production Statistics by Factory 2000-2006
COMPETITIVE POSITIONING
Summary 26 Reemtsma Ukraine: Competitive Position 2006
CIGARETTES IN UKRAINE
HEADLINES
TRENDS
Illicit Trade (Cigarettes)
Cigarettes: Price Bands
Cigarettes: Filter Splits
Table 18 Slims/superslims Penetration 2006
Summary 27 Slims/Superslims Cigarettes: New Product Launches 2007
Cigarettes: Pack Splits
COMPETITIVE LANDSCAPE
Summary 28 Cigarettes: New Product Launches 2007
PROSPECTS
SECTOR DATA
Table 19 Sales of Cigarettes by Tar Level: Volume 2001-2006
Table 20 Sales of Cigarettes by Tar Level: Value 2001-2006
Table 21 Sales of Cigarettes by Tar Level: % Volume Growth 2001-2006
Table 22 Sales of Cigarettes by Tar Level: % Value Growth 2001-2006
Table 23 Sales of Cigarettes by Price Band: % Volume Breakdown 2001-2006
Table 24 Sales of Cigarettes by Standard/Menthol: % Volume Breakdown 2001-2006
Table 25 Sales of Cigarettes by Tobacco Type: % Volume Breakdown 2001-2006
Table 26 Sales of Cigarettes by Filter vs Non-filter 2001-2006
Table 27 Sales of Filter Cigarettes by Carbon vs Non-carbon 2001-2006
Table 28 Sales of Cigarettes by Length 2001-2006
Table 29 Sales of Cigarettes by Pack Size 2001-2006
Table 30 Sales of Cigarettes by Pack Type 2001-2006
Table 31 Cigarettes Company Shares 2002-2006
Table 32 Cigarettes Brand Shares 2003-2006
Table 33 Forecast Sales of Cigarettes by Tar Level: Volume 2006-2011
Table 34 Forecast Sales of Cigarettes by Tar Level: Value 2006-2011
Table 35 Forecast Sales of Cigarettes by Tar Level: % Volume Growth 2006-2011
Table 36 Forecast Sales of Cigarettes by Tar Level: % Value Growth 2006-2011
Table 37 Forecast Sales of Cigarettes by Price Band: % Volume Breakdown 2006-2011
Table 38 Forecast Sales of Cigarettes by Standard/Menthol: % Volume Breakdown 2006-2011
Table 39 Forecast Sales of Cigarettes by Tobacco Type: % Volume Breakdown 2006-2011
Table 40 Forecast Sales of Cigarettes by Filter vs Non-filter 2006-2011
Table 41 Forecast Sales of Filter Cigarettes by Carbon vs Non-carbon 2006-2011
Table 42 Forecast Sales of Cigarettes by Length 2006-2011
Table 43 Forecast Sales of Cigarettes by Pack Size 2006-2011
Table 44 Forecast Sales of Cigarettes by Pack Type 2006-2011
CIGARS IN UKRAINE
HEADLINES
TRENDS
COMPETITIVE LANDSCAPE
Summary 29 Cigars: New Product Launches 2007
PROSPECTS
SECTOR DATA
Table 45 Sales of Cigars by Subsector: Volume 2001-2006
Table 46 Sales of Cigars by Subsector: Value 2001-2006
Table 47 Sales of Cigars by Subsector: % Volume Growth 2001-2006
Table 48 Sales of Cigars by Subsector: % Value Growth 2001-2006
Table 49 Company Shares of Cigars Excluding Cigarillos 2002-2006
Table 50 Brand Shares of Cigars Excluding Cigarillos 2003-2006
Table 51 Company Shares of Cigarillos 2002-2006
Table 52 Brand Shares of Cigarillos 2003-2006
Table 53 Forecast Sales of Cigars by Subsector: Volume 2006-2011
Table 54 Forecast Sales of Cigars by Subsector: Value 2006-2011
Table 55 Forecast Sales of Cigars by Subsector: % Volume Growth 2006-2011
Table 56 Forecast Sales of Cigars by Subsector: % Value Growth 2006-2011
SMOKING TOBACCO IN UKRAINE
HEADLINES
TRENDS
COMPETITIVE LANDSCAPE
PROSPECTS
SECTOR DATA
Table 57 Sales of Smoking Tobacco by Subsector: Volume 2001-2006
Table 58 Sales of Smoking Tobacco by Subsector: Value 2001-2006
Table 59 Sales of Smoking Tobacco by Subsector: % Volume Growth 2001-2006
Table 60 Sales of Smoking Tobacco by Subsector: % Value Growth 2001-2006
Table 61 Company Shares of RYO Tobacco 2002-2006
Table 62 Brand Shares of RYO Tobacco 2003-2006
Table 63 Company Shares of Pipe Tobacco 2002-2006
Table 64 Brand Shares of Pipe Tobacco 2003-2006
Table 65 Forecast Sales of Smoking Tobacco by Subsector: Volume 2006-2011
Table 66 Forecast Sales of Smoking Tobacco by Subsector: Value 2006-2011
Table 67 Forecast Sales of Smoking Tobacco by Subsector: % Volume Growth 2006-2011
Table 68 Forecast Sales of Smoking Tobacco by Subsector: % Value Growth 2006-2011