Research and Markets: Cigarettes & Tobacco Market Report Plus 2009

Source from:  BUSINESS WIRE 01/18/2010

Research and Markets (http://www.researchandmarkets.com/research/cc452a/cigarettes_tobac) has announced the addition of the "Cigarettes & Tobacco Market Report Plus 2009" report to their offering. "Cigarettes & Tobacco Market Report Plus 2009" This Market Report examines the UK cigarettes and tobacco market, which grew by 0.7% in value terms to £16.02bn in 2008, and increased by 4.7% between 2004 and 2008. Hand-rolling tobacco (HRT) continues to increase its share of the market as a growing number of consumers have switched from cigarettes to HRT in order to cut costs - a trend that has been compounded by the UK recession and rising unemployment. HRT's share of the market rose from 9.1% in 2004 to 13.1% in 2008, whereas the share held by cigarettes fell from 88.2% to 84.8% over the same period. The cigarettes sector has been affected by the rise in smuggled products and cross-border sales. The official figures provided by National Statistics misrepresent the size of the market because, while they do include spending on smuggled tobacco, they do not account for cross-border shopping. The Tobacco Manufacturers' Association (TMA) puts a much lower figure on the overall size of the market, estimating that it was worth just £12.6bn in 2007, compared with National Statistics' figure of £15.91bn for the same year. The cigars sector is in long-term decline, with sales falling by 14.5% between 2004 and 2008. Cigars are no longer fashionable and the sector has been hit by the decline in formal dining, as well as consumers' growing intolerance of the strong smell produced by cigars. Pipe tobacco and other tobacco products are also in long-term decline, with sales amounting to just £50m in 2008. Imperial Tobacco and Japan Tobacco International (JT) dominate the UK tobacco market and account for around four-fifths of cigarette sales in the UK, while British American Tobacco (BAT) has an approximate 6.5% share through brands such as Royals, Lucky Strike, Rothmans and Dunhill. According to Imperial Tobacco, in the year ending 30th September 2008, the five largest tobacco companies worldwide - excluding the People's Republic of China (PRC), which accounts for between a third and 40% of total global cigarette consumption - were Philip Morris International, BAT, JT, Imperial Tobacco and Altria. In 2008, Imperial Tobacco acquired Altadis - formerly the fifth-largest company in the industry. The authors forecast that volume consumption of cigarettes and tobacco will continue to decline over the next 5 years to 2013 as the prevalence of smoking falls further. In value terms, the market is expected to show only a moderate increase of 0.9% in 2009, and is forecast to grow by just 4.1% between 2009 and 2013. This growth will be as a direct result of price increases for cigarettes and tobacco over the forecast period. The value of the cigarettes sector is expected to decline between 2009 and 2013, while sales of HRT will increase rapidly as consumers continue to be cost conscious. High unemployment and the likelihood that economic growth will remain weak in 2009 and 2010 will also depress value sales. Further restrictions on smoking and cigarette sales are also likely to take place over the next 5 years to 2013, and this will further undermine the market. Enditem