Tobacco retail value sales continued to rise in 2022, boosted by the recovery of the Portuguese tourism industry and continuous investment by industry players in alternative products made from non-combustible materials, namely heated tobacco. Although consumers’ purchasing power was squeezed in 2022, as a consequence of rising living costs, tax earnings from tobacco surpassed initial government estimates.
Technological advances, e-commerce and the economic climate have created new opportunities for crime associated with counterfeit tobacco products in 2022. With rising living costs caused by inflation, higher interest rates and the energy crisis, illicit trade grew in 2022, despite the government’s continuous investment in fraud prevention and counterfeiting.
The tobacco category continues to be dominated by Tabaqueira SA - Empresa Industrial de Tabacos SA, a subsidiary of Philip Morris International, whose strategic efforts have been focused on alternative tobacco products. This strategic shift has reduced the company’s retail volume share in the cigarettes category, but the player has taken a dominant lead in heated tobacco products.
After heavy losses during the COVID-19 pandemic and restrictions on movement, the on-trade channel recorded a strong performance in tobacco sales in 2022 with out of home consumption recovering. By contrast, channels such as forecourt retailers and small grocers, which had benefited most during the lockdowns, recorded the weakest performance.
While tobacco retail value sales are likely to be boosted by higher taxes and thus rising unit prices, overall smoking prevalence should continuously decline in Portugal as prevention and awareness campaigns remain highly active. Legislation is also anticipated to become increasingly restrictive.
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Data and analysis in this report provides further detailed coverage dedicated to the following key categories, where applicable:
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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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