Cigars, Cigarillos and Smoking Tobacco in Malaysia

2021 DEVELOPMENTS

Sales of cigars, cigarillos and smoking tobacco slowly recovers as tobacco specialists reopen

In 2021, cigars, cigarillos and smoking tobacco saw a return to retail volume and current value growth. The growth rate was lower than that seen during the review period before the onset of COVID-19.

As a cheaper option than cigarettes, fine cut tobacco maintains solid growth

Within smoking tobacco, pipe tobacco also saw a slow recovery in 2021, although this was from a low base, and it remained a niche category. However, in an opposite trend, fine cut tobacco maintained retail volume growth.

Swisher retains its lead in cigars and Sincere in smoking tobacco

Company shares remained fairly stable across both cigars and cigarillos and smoking tobacco in 2021. With a myriad of product offerings in both cigars and cigarillos, Swisher International Group remained the leading player in cigars and cigarillos in volume terms in 2021, although whilst it led cigarillos, it was second to The Pacific Cigar Co in cigars.

PROSPECTS AND OPPORTUNITIES

As incomes recover, consumers will return to smoking cigars and cigarillos

Cigars and cigarillos is set to see steady growth from 2022. As the economy recovers and disposable incomes rise, this will promote higher rates of retail volume growth over the forecast period, along with even higher current value growth rates, as some consumers return to purchasing higher-priced large cigars.

Rising awareness of cigar smoking likely to contribute to the return to growth

Several upscale cigar lounges opened in prime high-traffic areas such as shopping centres towards the end of the review period, such as the Mayan Cigar Lounge and Cigar Malaysia. Although these had to close during lockdown in the beginning of 2021, they are likely to contribute to the return to growth for cigars in the forecast period.

Fine cut tobacco will remain popular early in the forecast period due to its low price

Fine cut tobacco is set to maintain steady retail volume and current value growth rates throughout the forecast period as consumers get to know the variety of flavours available, as well as its low price and rising accessibility nationwide. With many consumers remaining price-conscious as a result of the economic impact of COVID-19 and rising inflation, the growth of the category is expected to be strongest at the beginning of the forecast period.