Demand for tobacco increased in 2020 due to home seclusion and rising anxiety levels as a result of the pandemic in Singapore, as local consumers looked to tobacco products as a way to relieve stress. While Singapore continued to be impacted by community transmission of the contagious Delta and Omicron variants of COVID-19 in 2021, social gatherings were made possible in line with a gradual easing of restrictions, and thus consumers had greater choice in how they could spend their free time, leading to a low decline in value sales during the year.
Local consumers are reducing their discretionary spending in expectation of a GST tax hike in the near future, which was previously expected to be introduced in 2021 but delayed by the pandemic. This factor combined with the government’s constant efforts to reduce smoking prevalence and raise health awareness amongst the population led to a decline in sales of tobacco products such as cigarettes and fine cut tobacco in 2021.
With many restriction in place, there was limited new product innovation in tobacco in 2021. Leading players such as Philip Morris Singapore Pte Ltd and Corporación Habanos SA maintained their dominance of respective categories cigarettes, and cigars and cigarillos, as they have a prominent brand presence across different distribution channels with wider consumer reach.
Tobacco specialists were ordered to close during the two-month Circuit Breaker period in Singapore, which caused a temporary disruption to retail volume sales through this channel in 2020. Towards the end of 2020 and 2021 restrictions were lifted, thus maintaining the channel’s contribution to retail volume sales of cigars and cigarillos in Singapore.
With a higher minimum legal age for purchasing and consuming tobacco in Singapore, the demand for tobacco products is expected to shrink over the forecast period. Concerns of an impending GST tax hike will also influence Singaporeans’ discretionary spending, further contributing to the contraction of cigarettes in Singapore.
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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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