Local tobacco producers fear for their crops
The newly elected president Danilo Medina announced his on-going efforts to implement a new fiscal plan that would translate in a tax rate increase across multiple sectors, effective 1 January 2013. Local tobacco producers raised their concerns with officials that an increase in tax rates would imply a significant hit in the levels of consumption, resulting in the loss of jobs for many farmers who depend on the work in the tobacco fields; a situation that occurred when tax rates were raised for this industry in 2007. In response, the government reassured producers of its commitment to stimulate and develop the tobacco fields, and delivered 875 quintals of fertiliser and plague-control pumps.
Cigarette sales decline at much slower rate
Cigarette sales declined at a slower rate of 3% in volume terms in 2012. The category has been greatly affected since 2007 when the government implemented a fiscal plan that elevated tax rates, which was later corrected due to the consequences on the consumption levels of tobacco and its derivatives. Taking advantage of this fiscal law, illicit trade of cigarettes penetrated the country and further disrupted the consumption patterns of this category, as consumers were seduced by lower-priced offerings. However, as more middle- and high-income consumers engage in hectic lifestyles and are exposed to higher levels of stress, the consumption of stress relievers, such as cigarettes, will increase, so sales within this market are expected to begin to stabilise during the forecast period.
Philip Morris Dominicana SA supports local production
Philip Morris Dominicana SA, the market leader within cigarettes in the Dominican Republic, sustains a commitment with local producers by being the sole buyer of Burley tobacco grown in the territory. The company has also committed to help producers improve the quality of their crops. The company invests in extending technical workshops to local producers and updates them on latest trends.
Cigarettes popularly consumed in small independent grocers
Small independent grocers, also known as colmados, usually have a dual use within this market, as they can function as both an off-trade and an on-trade channel, facilitating tables and chairs to accommodate lower-income consumers, as they gather with friends and family and consume alcoholic drinks and cigarettes while catching up on current events or playing a game of dominos. Middle-income locals also tend to purchase cigarettes from small independent grocers, as these are widespread in the territory; however, this group tends to consume their purchases elsewhere.
Stable performance expected over the forecast period
While cigar consumption is set to show continued and healthy expansion driven mainly from tourism, flat domestic cigarette volume growth over the forecast period is expected. As the government engages in a fiscal recovery plan, further threats to the market are expected to impact luxury/recreational markets such as cigarettes.
Samples (FAQs about samples):
Sample Tobacco Market Research Report
Sample Tobacco Data
Delivery: Files are delivered directly into your account within a few minutes of purchase.
Discover the latest market trends and uncover sources of future market growth for the Tobacco industry in Dominican Republic with research from Euromonitor's team of in-country analysts.
Find hidden opportunities in the most current research data available, understand competitive threats with our detailed market analysis, and plan your corporate strategy with our expert qualitative analysis and growth projections.
If you're in the Tobacco industry in Dominican Republic, our research will save you time and money while empowering you to make informed, profitable decisions.
When you purchase this report, you also get the data and the content from these category reports in Dominican Republic for free:
The Tobacco in Dominican Republic market research report includes:
- Analysis of key supply-side and demand trends
- Detailed segmentation of international and local products
- Historic volumes and values, company and brand market shares
- Five year forecasts of market trends and market growth
- Production, imports by origin, exports by destination
- Robust and transparent market research methodology, conducted in-country
Our market research reports answer questions such as:
- What is the market size of Tobacco in Dominican Republic?
- What are the major brands in Dominican Republic?
- Which sector of the tobacco products market is the largest by value sales in Dominican Republic?
- Which sector of the tobacco products market has been growing the fastest, by volume and value, in Dominican Republic?
- Which sector is the most heavily taxed in Dominican Republic?
- Which companies dominate in the total tobacco market in Dominican Republic in terms of market share?
- What is the distribution channel split for the tobacco products market in Dominican Republic?
Why buy this report?
- Gain competitive intelligence about market leaders
- Track key industry trends, opportunities and threats
- Inform your marketing, brand, strategy and market development, sales and supply functions
This industry report originates from Passport, our Tobacco market research database.