Archive for December, 2012

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Euromonitor study puts India in sixth spot on world contraband cigarette table

| December 28, 2012

Indiahas become the sixth largest market for contraband cigarettes, according to an Indo-Asian News Service story quoting a Euromonitor study carried out on behalf of Assocham, a tobacco industry lobbyist.

The licit cigarette market, which stood at 109 billion in 2006-07, dropped to about 101 billion in 2010-11.

In contrast, the duty-evaded segment has grown to about 20 billion cigarettes, or about 16 per cent of the total market for cigarettes, having grown by 82 per cent between 2004 and 2011.

Euromonitor estimates that illicit cigarette volumes inIndiawill grow further, capturing more than 23 per cent of the total market by 2016.

Little wonder. In cities such as Mumbai, Delhi, Pune, Bangalore and Hyderabad, the trade in contraband cigarettes is said by the study authors to be conducted with ‘brazen openness’. A variety of smuggled brands can be found at almost every cigarette selling outlet and consumers can find their smuggled brand of choice with ease.

The contraband problem is said to be endemic toIndiabut to be especially severe in urban areas.

Contraband cigarettes are smuggled into India from China, Myanmar, Bangladesh, Indonesia, Pakistan, the Gulf states, and Southeast Asian and European countries.

‘Clearly, the drive to curb the entry of contraband cigarettes into India needs to be undertaken in a more stringent, sustained and organized manner,’ the study says.

China conference registration open

| December 28, 2012

The TFWA (Tax Free World Association) says that registration is now open for a conference on China to be held at Beijing in March.

‘China’s century: The fast pace of change in China duty free & travel retail’ is due to be held at the Beijing Hotel on March 5-7.

Organised jointly by the TFWA and APTRA (Asia Pacific Travel Retail Association), the event is due to bring together ‘a wealth of international and local expertise, including some of the most influential figures in Chinese duty free and travel retail’.

More information about the conference is at:

China looks to reduce tobacco farm numbers and planted area

| December 27, 2012

More details are emerging about China’s plans – reported here on December 24 – to crack down on tobacco.

The country is looking to reduce the area planted to tobacco along with the number of tobacco farms, ban tobacco smoking in all enclosed public places, and enlarge the warning signs on tobacco packs by 2015, according to a story quoting the Beijing Times.

The plan says also that China will reduce the number of tobacco companies operating in the country and the number of brands on sale in an effort further to unify the tobacco industry.

China already bans direct tobacco advertisements but the latest plan would specifically ban advertisements on the internet and on public transport, and in public places including museums, libraries, hospitals and schools. It would forbid tobacco companies from promoting their products through charitable, social or environmental activities. And tobacco-related trademarks would be banned from movies and television programs.

Health warnings, which are on the back of packs, would be increased from 30 per cent to 50 per cent of the surface area.

Korea enjoys tobacco trade surplus

| December 27, 2012

The value of South Korea’s tobacco exports increased by 370 per cent during the past 10 years while imports remained steady, resulting in a tobacco trade surplus since 2004, according to a story in The Korea Times.

Ninety seven per cent of tobacco exports comprise cigarettes.

In 2002, Korea’s tobacco imports amounted to more than double its exports but, by last year, exports had risen to be 1.7 times higher than its imports, data from the Korea Customs Service (KCS) has shown.

“Much of the domestic demand for imported manufactured tobacco appears to have been replaced by demand for Korean-made products as their quality improved,” said a KCS official.

In 2002, more than three quarters of the tobacco imported byKorea was in the form of manufactured products, but this share fell to about 40 per cent last year, with the rest comprising unmanufactured leaf tobacco.

Meanwhile, the Yonhap News Agency said that the value of exports had increased from US$156.29 million to US$572.05 million during the 10 year period.

Forty per cent sales drop in Macau

| December 27, 2012

Sales of licit tobacco products are reported to have slumped by as much as 40 per cent in Macau this year as a ‘hefty’ tax increase and anti-smoking campaigns have taken their toll, according to a Macau Daily Times story.

The industry, which is expecting a further decline of 10 per cent during 2013, is preparing to cut its operational costs if necessary.

But the industry has stressed that it is too early to say if the government’s aggressive anti-smoking measures will result in any significant drop in the number of smokers, despite the dramatic fall in sales.

The government increased taxes by two-and-half times at the end of last year and many smokers simply switched to buying cigarettes on the mainland of China.

Police and customs seize opportunity to learn about tobacco production

| December 27, 2012

Police and customs officials have visited Imperial Tobacco’s fine-cut tobacco factory in Ireland at the invitation of Imperial and as part of ongoing efforts to tackle the illicit trade in tobacco products.

‘To aid them in their investigations, a group of 10 enforcement officers toured the Mullingar plant to see how legitimate tobacco products are made,’ Imperial said in a note posted on its website.

‘The visitors were shown all aspects of the manufacturing process from the bales of raw tobacco being received to packaged Golden Virginia and Drum leaving the warehouse.

‘Authorities suspect illicit factories have been set up on both sides of the Irish border due to the large amounts of unprocessed tobacco seizures in recent months.’

“The officers found our knowledge and expertise really useful and hopefully we will hear of additional seizures and prosecutions in the future,” said factory manager, Declan Hughes.

Meanwhile, Carl Philips, AIT executive in Ireland, said that building good relations with those who are hunting out Imperial’s criminal competitors was an integral part of the company’s anti-illicit trade strategy.