Cigarettes in Belarus

PROSPECTS

Sales of cigarettes are increasingly hindered by more health-conscious consumers

Cigarettes continued to decline in 2018 in volume sales terms. Health-awareness is being expanded by the state’s promotion of healthy living through social commercials, causing more smokers to quit their habit.

New legislation restricts sales further

Late in the review period and in 2019, there were new changes to cigarettes packaging, sales and smoke-free public areas. Around three quarters of the Belarusian population does not smoke, with local government ensuring that the rights of the non-smoking population are protected.

Outbound illicit trade is still an issue

Outbound illicit trade from Belarus remains significant. In 2018, the cigarettes production quota in Belarus was up to 40 billion sticks, while Belarusian consumption totalled 15 billion.

COMPETITIVE LANDSCAPE

Local production dominates and strengthens further thanks to new private player Energo-Oil

In 2018, cigarettes production and sales remained dominated by state-owned Neman Tobacco Factory Grodno and privately owned Tabak-Invest SP OOO. These two players produce the majority of cigarette brands available in Belarus under licence, with only a minor share being imported.

NPD focuses on brand extensions rather than new brands, though Philip Morris launches Parliament

In 2017-2018, there was a moderate number of new product developments, most of which were extensions to existing brands. The most interesting change affected Philip Morris; in mid-2018 Energo-Oil received the rights to distribute the international company’s brands.

Energo-Oil is set up to boost local and foreign demand

In mid-2018, the state authorised private company Energo-Oil to build a unified retail chain of tobacco kiosks. Subsequently, kiosks named Tabakerka began appearing in some Belarusian districts.

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