The rate of growth in retail constant value sales of tobacco in Nigeria more than doubled during 2021, but this was mainly driven by the fastest rate of growth in unit pricing (in current value terms) in well over a decade. This price hike was largely the result of a sharp depreciation in the foreign-exchange value of the naira, which made imports more expensive.
Apart from inflationary pressure caused by a weak currency, unit prices for tobacco products also increased strongly in 2021 due to a rolling over of tax increases from 2020, particularly in cigarettes. A new tobacco taxation regime was introduced in 2020, introducing a new specific excise tax rate.
British American Tobacco (Nigeria) (BATN) has traditionally enjoyed a near-monopoly in cigarettes, but although it remains dominant, its retail volume share has declined over the course of the forecast period. The product offer in cigarettes has widened significantly, with Japan Tobacco Inc offering the Dorchester and Sterling brands and Philip Morris International Bond Street, Chesterfield, and Marlboro, for example.
The distribution of tobacco in Nigeria is dominated by newsagent-tobacconists/kiosks, whilst street vendors and independent small grocers are also popular. Retailers in these channels often sell cigarettes individually.
A rising population (Nigeria has one of the highest fertility rates in the world) and urbanisation will support moderate growth in retail volume sales of cigarettes during the forecast period, in spite of the fact that smoking prevalence will continue to decline. While premium brands will remain the most popular option, they will continue to lose retail volume share to economy and particularly mid-price offerings.
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Understand the latest market trends and future growth opportunities for the Tobacco industry in Nigeria with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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Passport Tobacco covers the seven major tobacco categories: Cigarettes, Cigars & Cigarillos, Smoking tobacco (made up of Pipe tobacco and RYO tobacco), Smokeless Tobacco (snuff and chewing tobacco), E-Vapour Products (closed and open); Heated Tobacco; and Tobacco Free Oral Nicotine. Smoking paraphernalia such as pipes, rolling papers, lighters or matches, etc., are not included, nor are nicotine replacement therapy (NRT) products, which are part of Euromonitor's Passport Consumer Healthcare database.See All of Our Definitions
This report originates from Passport, our Tobacco research and analysis database.
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