Cigars, cigarillos and smoking tobacco posted more reasonable current value growth in 2021 than the double-digit increase seen in 2020. This slowdown stemmed from the massive slowdown in growth in fine cut tobacco.
The lockdown, the subsequent ban on home parties and the closure of terraces of cafés/bars and restaurants until mid-May 2021 limited the smoking of cigars, which is often done on social occasions. The same was the case for cigarillos, the consumer base for which is ageing.
JT International France SAS and Seita Groupe Imperial Tobacco SA were the leading two players in smoking tobacco in 2021, ahead of Philip Morris France SAS and British American Tobacco France. As consumers migrated to fine cut tobacco from cigarettes, the top two players also recorded double-digit volume growth in 2020, but could not repeat this feat in 2021, as this was a year of normalisation.
Even though in volume terms, sales of cigars, cigarillos and smoking tobacco continue to wane structurally, this category has been relatively spared in comparison with cigarettes. This is due to the much stronger progression of taxation on cigarettes than on products in the category, with COVID-19 increasing price sensitivity within the county, and therefore driving a stronger migration to cigars, cigarillos and smoking tobacco.
Many trade sources believe that the privileged position of cigars, cigarillos and smoking tobacco will not last. After the elections, there is the possibility of a strong tax increase, in coordination with the tax increase on cigarettes, in order to limit the migration of smokers to cheaper high-risk tobacco products.
Sales in the cigars category are not expected to improve in the short term. Similar to traditional dark cigarillos, economy and mid-priced cigars will continue to wane due to an ageing consumer base.
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Cigars, Cigarillos and Smoking Tobacco
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