There have been some shifts in regard to the distribution of cigarettes in Egypt owing to the impact of the COVID-19 pandemic. Those shops deemed to be non-essential outlets were affected negatively in terms of cigarettes sales, as store closures, lockdowns and restrictions on opening hours were put in place in 2020.
Some consumers stockpiled cigarettes early in the pandemic for fear of running out. In addition, volume growth was supported by lower sales via illicit trade and the black market.
While there was further sales growth in 2020, some consumers were shifting away from smoking cigarettes or smoking less, as they were unable to smoke in the house, but not allowed outside due to the curfew hours, or due to the closure of coffee shops offering hookah products. In addition, some consumers were suffering financially from the pandemic due to job losses, and were having to be careful with their budgets, limiting spending only to the essentials.
According to the leading player, Eastern Co, the company is expanding its products and expected to go into the flavoured cigarettes category after the success of its flavoured molasses products, aiming to lead the flavoured cigarettes segment over the forecast period. Moreover, over the forecast period, it is anticipated that Eastern Co will increase its production capacity as a result of the continual rise in demand in Egypt.
Over the forecast period, the volume CAGR in cigarettes is expected to be lower than that of the review period. COVID-19 is likely to lead to a longer-term focus on respiratory health, which is likely to have a negative impact on sales of cigarettes in the future.
Another challenge to retail sales of cigarettes will increased demand for illicit cigarettes, with illicit trade volume sales set to comfortably outpace legal sales in the forecast period. An increasing number of new brands are being illegally traded and sold at extremely low prices, which is evidence that many smokers with low disposable incomes are continuing to search for more affordable options, especially given the financial fallout of COVID-19.
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Understand the latest market trends and future growth opportunities for the Cigarettes industry in Egypt with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
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This report originates from Passport, our Cigarettes research and analysis database.
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