Although facing nationwide lockdowns in light of COVID-19, sales of cigarettes still grew in 2020, recovering from the negative impact demonstrated in 2019. Due to the government’s fast reaction to the pandemic, China has managed to contain the situation with more success than many other countries, and has effectively resumed manufacturing and retailing across several industries, including cigarettes.
According to the State Tobacco Monopoly Administration (STMA), significant progress has been achieved in the crackdown on counterfeiting and smuggling of tobacco products in 2020. By the end of August 2020, a total of 5,390 cases involving counterfeit cigarettes, with a value of more than CNY50,000, had been investigated and dealt with.
Development of retail and the upgrading of information technology has accelerated the process of digital transformation of the cigarette industry, a trend hastened by the pandemic. During this tough period, the importance of digital transformation within the traditional industry became prominent, as manufacturers adopted the “Cloud Office” format, promoted “unmanned planting” of tobacco, as well as launching “contact-free delivery”, all initiatives which require deep application of technology within the industry.
In cigarettes, both retail volume and value (at constant 2020 price) are anticipated to slow down over the forecast period, due to the decreasing smoking prevalence among adults. Moreover, according to the Healthy China 2030 Initiatives, released in 2016, China aims to lower smoking prevalence over the age of 15 to 20% by 2030.
Although partially constrained by home seclusion and national lockdown, the growth rate of mid-priced and premium cigarettes still performed well in 2020, driving growth overall. Growth of premium and mid-priced cigarettes can be attributed to the following reasons.
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Understand the latest market trends and future growth opportunities for the Cigarettes industry in China with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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This report originates from Passport, our Cigarettes research and analysis database.
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