Smoking tobacco in Algeria, which is dominated by pipe tobacco, saw a strong shift to retail sales and at-home consumption due to the closure of foodservice in 2020 as a result of stay-at-home and social distancing measures from March 2020. Pipe tobacco suffered due to the pandemic as home seclusion and lockdown reduced social opportunities for smoking, given the inconvenience of smoking pipe tobacco at home.
Demand for cigars and cigarillos remains low in Algeria as they are not perceived as alternatives to cigarettes by most local smokers. Moreover, the lack of local production, restrictions on imports, local currency depreciation and the high unit price of products did not help the category to develop.
Cigars witnessed no new product launches during 2021. Indeed, there was no innovation in the category towards the end of the review period as no new flavours or tobacco blends were introduced.
Cigars and cigarillos in Algeria are expected to continue declining due to the high taxes on tobacco and the shutdown of the local production of domestic cigars brands by United Tobacco Company (ex SNTA). Cigars and cigarillos, which rely exclusively on imports, remain expensive products, and therefore the consumption level is not expected to increase significantly.
Smoking tobacco is set to record further growth thanks to a rising consumer base for pipe tobacco and shisha water pipes, which is projected to continue boosting demand for new flavours. However, water pipe tobacco will not be able to attract a significant number of smokers away from cigarettes as it is not expected that it will become more fashionable to smoke water pipe tobacco in Algeria.
It is predicted that the exchange value of the Algerian dinar will depreciate further during the forecast period as a consequence of the country’s ongoing economic crisis, a situation which would likely have a negative impact on the imports of cigars, cigarillos and smoking tobacco paid for in foreign currency. This, in addition to the rising cost of tobacco products, is likely to have a negative impact on sales of smoking tobacco over the forecast period to 2026.
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Cigars, Cigarillos and Smoking Tobacco
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