Cigarettes in Algeria

PRE-COVID-19 PERFORMANCE

Tax hikes boost value growth and benefit demand for mid-price cigarettes

Cigarettes sales are expected to continue to rise over the coming years as a result of many factors, partly due to the impact of multiple excise duty increases on prices. Anti-smoking campaigns and strategies implemented by the Algerian Government, coupled with the fact that smokers are increasingly switching to vapour products (still a very small niche), are expected to suppress cigarettes’ growth over the coming years.

High-tar cigarettes continue to lead sales, despite rising health awareness

High-tar cigarettes are set to continue dominating volume sales as they are the most economic and popular types of cigarettes in the country. The majority of regular cigarette smokers in Algeria are men rather than women.

Groupe MADAR sees share slip as consumers move towards mid-price products

The Algerian cigarettes market is concentrated and controlled by three main players: STAEM, the state-owned Groupe MADAR (ex-SNTA), and British American Tobacco Algeria, accounting for a combined volume share of over 90%. While there were no changes in rankings recently, Groupe MADAR lost ground due to declines in both quality and quantity.

2020 AND BEYOND

COVID-19 impact

In 2020, sales of cigarettes are now expected to decline by 1% in constant 2019 value terms in light of the impact of COVID-19. This compares to a 6% fall in sales forecast for 2020 in our 2019 edition of tobacco.

Recovery and opportunities

Over the forecast period, the UK Government will likely use tobacco taxation increases to help pay for its response to COVID-19. The resultant increasing price of cigarettes and rise in the health awareness trend are likely to deter new smokers, while others will turn towards cheaper or less harmful options.

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