Volume sales of cigarettes continued to decline in 2021, a trajectory in line with trends observed over the review period, driven by rising taxes, increased controls over public smoking as well as the continuing decline in smoking prevalence. Annual excise tax increases continued to place pressure on the affordability of cigarettes, especially for the premium and mid-priced segments.
In 2021, illicit trade sales continued to grow in the country, driven by rising costs in the legal market. Data released by the Australian Border Force (ABF) showed that over the course of 2021, the ABF detected 878.
Increasing excise taxes and an annual inflation rate of 3.5% by December 2021 continued to place considerable pressure on consumer spending, particularly as tobacco consumption is heavily skewed towards low socio-economic areas.
Over the forecast period, there is expected to be a pattern of consumers trading down from premium to mid-priced brands and from mid-priced to economy brands, with ongoing price rises forcing Australians to reassess their purchasing decisions. In line with this trend, manufacturers are expected to focus on consolidating their economy brand positioning.
According to the new regulations implemented in October 2021, consumers must present a valid prescription from an Australian medical practitioner for all purchases of nicotine-based e-vapour products, including e-liquids. This includes products dispensed in Australia and imported by the patient directly from overseas.
A group of Australian public health experts advocated for a smoke-free society in a perspective article published in the Medical Journal of Australia in November 2021, which received widespread feedback from many stakeholders. The proposal called on the government to focus on retail, as previous efforts have largely addressed consumers.
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Understand the latest market trends and future growth opportunities for the Cigarettes industry in Australia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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RETAIL SALES OF DUTY PAID CIGARETTES The definition of cigarettes for the purposes of this study is duty-paid, machine manufactured white-stick products. This does not exclude brands of cigarettes that do not use white paper but it is designed to exclude the volume of non-machine manufactured products such as bidis/beedis (India) and papirosy (Russia), and other smoking products made with tobacco but that either do not resemble cigarettes as recognised in the US or Europe, or those that are not machine manufactured. The exclusion of these products is intended to give a more accurate picture of the "true" market for cigarettes and cigars which has been distorted in official statistics and published reports because of the inclusion of hybrid products. NB Please note that due to its central importance and integration into the industry mainstream, Indonesia’s market data does include hand-rolled kreteks DUTY-FREE sales are excluded from retail sales, as are herbal cigarettes. ILLICIT TRADE CIGARETTES Not included in retail sales, but split out separately in volume terms only. Defined as non-duty paid cigarettes (includes smuggled & counterfeit/fake products combined). Legitimate cross-border sales are considered duty-paid. Sales arising from a foreign national purchasing cheaper cigarettes in bulk in a neighbouring country for personal use and exported back are attributed to the country where the purchase is made (e.g. bulk cigarette sales by British nationals in France are attributed to France).See All of Our Definitions
This report originates from Passport, our Cigarettes research and analysis database.
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