From the Associate editor
A new year makes us think of new beginnings, new projects to start, new goals to achieve, and resolutions w
Nattira Medvedeva
Nattira Medvedeva, Associate Editor
e may or may not be able to stick to, such as new gym memberships, crash diets, or quit smoking plans.
For Tobacco Asia, 2021 marks the 25th year of publishing, which we are quite proud of. Also, with this first-ever January/February edition, Tobacco Asia officially expands to six times a year (a bimonthly) from our previous five times a year (quinterly?) schedule. So, now, we will be bringing even more of the feature stories and industry updates readers have come to expect from Tobacco Asia in both English and Chinese language editions.
Although online access to the current and past issues is available complimentary online at www.tobaccoasia.com (no paywall erected; no logins required), you should renew your subscription as this free access may change shortly.
After all that transpired in 2020, a review of sales shows that people in the US have been smoking more and sales remained steady, putting an end to a decades-long decline, according to data from Altria Group.
Apparently, people had more time on their hands and more money to spend because they had fewer spending opportunities in going out, travel, and dining due to various lockdowns. Even the US FDA acknowledged that people effected by the pandemic – be it from health concerns, job loss, or just the mental impact from being in lockdown – experienced increased stress and anxiety which could be a contributing factor to the “smaller-than-expected reduction in cigarette sales”. Also, some e-cigarette users switched back to traditional smokes due to higher e-cig taxes, bans, and confusion over the health effects of vaping after last year’s EVALI cases.
The situation isn’t limited to just the US. For example, South Korean cigarette sales went up 4.1% last year, with 3.59 billion 20-cigarette packs sold, compared to 3.45 billion the year before. Altria’s sales rose 4.9% in the quarter ended December 31, going up from US$6 billion in 2019 to US$6.3 billion last year, with revenue from cigarettes and cigars coming in at US$5.6 billion.
Altria wasn’t the only one seeing positive results last year. PMI, BAT, JTI, and Imperial Brands all adjusted their sales or profit targets, too, after realizing that the effects from the pandemic didn’t turn out to be as bad as originally thought.
The consumption and products outlook for 2021 of course depends on a range of different factors including changes in consumer behavior, changes in legislation, lockdown durations, the rollout of Covid-19 vaccines, lifestyle changes, etc. Some tobacco firms might follow recent announcements by Pyxus International and Imperial Brands indicating a refocus of resources on traditional tobacco. (Pyxus announced it was exiting the cannabis business and will be focusing on its more profitable tobacco and e-liquid operations, while Imperial’s new c.e.o, Stefan Bomhard, said the company will be targeting cigarette sales, prioritizing investment in the UK, Spain, Germany, Australia, and the US, which together make up 72% of Imperial’s profits from combustible products.) Or maybe the NGP sector might continue strong with even newer breakthroughs.
It’s probably still too early to tell, but 2021 should be an exciting year, especially with major exhibitions such as InterTabac/InterSupply on track. Now with a better understanding of the virus, vaccines, and how we can live with it “new normal” and all, business can pick-up again and move full-steam ahead.