Executive Summary

Jul 2019
PROSPECTS
Illicit trade remains high, but is set to decline as smoking becomes less common

The number of legal cigarettes released for consumption in Latvia increased slightly in 2018 compared with 2017. To a large extent this was thanks to local authorities being effective in fighting illegal imports.

Growing competition, escalating prices and health trend contribute to decline

The growing sales of cheaper make-your-own tobacco products, especially fine cut tobacco, indicate the continuing migration of price-sensitive traditional smokers from cigarettes. Despite disposable income rising in the country, cigarette prices remain increasingly unaffordable owing to regular tax hikes.

Flavour ban restricts innovation

Following the implementation of the EU directive banning flavour capsules from May 2017 and menthol cigarettes from 2020, the categories have stagnated or declined slightly as producers are unwilling to invest further in innovation. Additionally, younger consumers who would normally be attracted by the flavoured alternatives are largely captured either by e-vapour products or flavoured fine cut tobacco, the flavour-mixing concept of which offers more opportunities for self-expression.

COMPETITIVE LANDSCAPE
Caines benefits from rising incomes and focus on quality

The Caines brand jumped up into the top 10 rankings by volume share in 2018. Owned on a global level by British American Tobacco Plc, Caines achieved considerable sales growth thanks to consumers’ increasing preference for cigarettes perceived as higher quality.

Philip Morris remains the clear leader but suffers due to shifting focus to heated tobacco

While Philip Morris Latvia SIA saw its retail volume share decline in 2018, it remained the clear leader in cigarettes. Baltic Sales Network Sia – the official representative of Japan Tobacco Inc – continued to gain share, due to the strong and stable positions of Winston and LD, both in the mid-priced segment, the largest price band in Latvian cigarettes.

Only the strongest will survive a likely POS display ban

An anticipated ban on tobacco displays in stores is expected to make launching new products extremely challenging. It is likely that the brands best placed to survive such a cut in visual communication would be well-established names by key players, such as Philip Morris and British American Tobacco (through its subsidiaries).

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Cigarettes in Latvia

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Overview

Discover the latest market trends and uncover sources of future market growth for the Cigarettes industry in Latvia with research from Euromonitor's team of in-country analysts.

Find hidden opportunities in the most current research data available, understand competitive threats with our detailed market analysis, and plan your corporate strategy with our expert qualitative analysis and growth projections.

If you're in the Cigarettes industry in Latvia, our research will save you time and money while empowering you to make informed, profitable decisions.

The Cigarettes in Latvia market research report includes:

  • Analysis of key supply-side and demand trends
  • Detailed segmentation of international and local products
  • Historic volumes and values, company and brand market shares
  • Five year forecasts of market trends and market growth
  • Production, imports, and exports of finished cigarettes
  • Robust and transparent market research methodology, conducted in-country

Our market research reports answer questions such as:

  • What is the market size of Cigarettes in Latvia?
  • What are the major brands in Latvia?
  • What is the legislative environment like in Latvia?
  • What are the rates of cigarette taxation in Latvia?
  • Do premium, mid-price or economy cigarettes dominate in Latvia?
  • What is the rate of illicit trade in Latvia?
  • How many smokers are there in the country?

Why buy this report?

  • Gain competitive intelligence about market leaders
  • Track key industry trends, opportunities and threats
  • Inform your marketing, brand, strategy and market development, sales and supply functions

This industry report originates from Passport, our Tobacco market research database.

Cigarettes in Latvia - Category analysis

HEADLINES

PROSPECTS

Illicit trade remains high, but is set to decline as smoking becomes less common
Growing competition, escalating prices and health trend contribute to decline
Flavour ban restricts innovation

COMPETITIVE LANDSCAPE

Caines benefits from rising incomes and focus on quality
Philip Morris remains the clear leader but suffers due to shifting focus to heated tobacco
Only the strongest will survive a likely POS display ban

TAXATION AND PRICING

Taxation rates
Summary 1 Taxation and Duty Levies 2013-2018
Average cigarette pack price breakdown
Summary 2 Average Cigarette Pack Price Breakdown: Brand Examples

CATEGORY DATA

Table 1 Sales of Cigarettes: Volume 2013-2018
Table 2 Sales of Cigarettes by Category: Value 2013-2018
Table 3 Sales of Cigarettes: % Volume Growth 2013-2018
Table 4 Sales of Cigarettes by Category: % Value Growth 2013-2018
Table 5 Sales of Cigarettes by Blend: % Volume 2013-2018
Table 6 Sales of Cigarettes by Standard/Menthol/Capsule: % Volume 2013-2018
Table 7 Sales of Cigarettes by Regular/Slim/Superslim/Microslim: % Volume 2013-2018
Table 8 Sales of Cigarettes by Pack Size: % Volume 2013-2018
Table 9 Sales of Cigarettes by Price Band: % Volume 2013-2018
Table 10 NBO Company Shares of Cigarettes: % Volume 2014-2018
Table 11 LBN Brand Shares of Cigarettes: % Volume 2015-2018
Table 12 Sales of Cigarettes by Distribution Format: % Volume 2013-2018
Table 13 Illicit Trade Estimate of Cigarettes: Volume 2013-2018
Table 14 Forecast Sales of Cigarettes: Volume 2018-2023
Table 15 Forecast Sales of Cigarettes by Category: Value 2018-2023
Table 16 Forecast Sales of Cigarettes: % Volume Growth 2018-2023
Table 17 Forecast Sales of Cigarettes by Category: % Value Growth 2018-2023
Table 18 Forecast Sales of Cigarettes by Blend: % Volume 2018-2023
Table 19 Forecast Sales of Cigarettes by Standard/Menthol/Capsule: % Volume 2018-2023
Table 20 Forecast Sales of Cigarettes by Regular/Slim/Superslim/Microslim: % Volume 2018-2023
Table 21 Forecast Sales of Cigarettes by Pack Size: % Volume 2018-2023
Table 22 Forecast Sales of Cigarettes by Price Band: % Volume 2018-2023

Tobacco in Latvia - Industry Overview

EXECUTIVE SUMMARY

Traditional tobacco faces uphill battle as smoking becomes more expensive and smokers migrate for health reasons
Tobacco evolves with the introduction of Iqos
Premium cigarettes gain share as disposable incomes rise, while new POS display ban means only strongest brands will survive
Specialist outlets proliferate, often with a highly niche focus
Cigarettes set for decline as tobacco laws tighten

OPERATING ENVIRONMENT

Legislation
Legislative overview
Summary 3 Legislation Summary at a Glance
Minimum legal smoking age
Smoking prevalence
Tar levels
Plain packaging
Advertising and sponsorship
Advertising through media (television, radio, billboards, consumer press, trade press, cinema etc)
Advertising through retail point of sale
Sponsorship of sporting/music events
Distribution of tobacco-branded gifts (cigarette-branded lighters, pens etc)
Point-of-sale display bans
Smoking in public places
Low ignition propensity (LIP) cigarette regulation
Flavoured tobacco product ban
Reduced harm
E-vapour products

PRODUCTION/IMPORTS/EXPORTS

MARKET INDICATORS

Table 23 Number of Adult Smokers by Gender 2013-2018

MARKET DATA

Table 24 Sales of Tobacco by Category: Volume 2013-2018
Table 25 Sales of Tobacco by Category: Value 2013-2018
Table 26 Sales of Tobacco by Category: % Volume Growth 2013-2018
Table 27 Sales of Tobacco by Category: % Value Growth 2013-2018
Table 28 Forecast Sales of Tobacco by Category: Volume 2018-2023
Table 29 Forecast Sales of Tobacco by Category: Value 2018-2023
Table 30 Forecast Sales of Tobacco by Category: % Volume Growth 2018-2023
Table 31 Forecast Sales of Tobacco by Category: % Value Growth 2018-2023

DEFINITIONS

SOURCES

Summary 4 Research Sources