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US e-cigarette firm moving into Canada

| August 12, 2014

The US-based electronic cigarette company LOGIC Technology said yesterday that it was expanding into the Canadian market through a partnership with Hilary’s Salesmaster.

Under the partnership agreement, LOGIC’s electronic cigarettes will be made available at more than 30,000 accounts operated by the distributor nationwide in Canada.

LOGIC’s products include both disposable and rechargeable versions and are available in traditional and menthol flavors.

The company is ranked number two in the US in respect of its dollar sales and its market share.

“We are excited to expand LOGIC’s distribution in Canada and are thrilled to be working with Hilary’s Salesmaster, a company with a vast footprint within the Canadian market,” said Miguel Martin, president of LOGIC. “We offer a premium product for adult consumers, as well as high margins for our retail and trade partners, and we are eager to meet the demand of consumers in Canada with our products.”

Since 1951, Hilary’s Salesmaster has developed a strong national presence in the Canadian retail market that currently reaches thousands of food, drug, mass, convenience, gas, food-service and hardware retailers.

“Hilary’s is excited to bring LOGIC to the Canadian marketplace,” said Stewart Ingles, president of Hilary’s Salesmaster.

“We have an extensive marketing campaign aimed at making LOGIC the number one brand in Canada.

“With our distribution and marketing skills, combined with the support of LOGIC Technology, we will strive to build LOGIC as the preeminent e-cig brand in Canada.”

Saudi tobacco imports increasing solidly

| August 12, 2014

Saudi Arabia’s tobacco products imports have increased consistently during each of the past four years, according to an Arab News story citing local media reports based on ‘recent data’.

The country was said to have imported tobacco products worth SR2.6 billion during 2010, a figure that rose by 15 per cent to SR3.0 billion during 2011, by 17 per cent to SR3.5 billion during 2012 and by nine percent to SR3.8 billion during 2013.

Although Saudi Arabia imports cigarettes from more than 17 countries, 91 percent of its tobacco products imports last year came from just three countries, Germany, Switzerland and Turkey.

Germany accounted for about 57 percent of the imports, while Switzerland and Turkey each accounted for about 17 per cent.

New evidence shows plain packaging has not achieved Australia’s health goals

| August 11, 2014

British American Tobacco says there is no credible evidence that standardized tobacco packaging will reduce smoking.

In a press note posted on its website, the company said that even Sir Cyril Chantler’s own review for the UK Department of Health admitted the evidence that standardized packaging could improve public health was ‘modest and had its limitations’.

‘Australia is the only country to have introduced plain packaging and the experiment there is failing,’ said BAT. ‘In the first year alone:

* ‘Legal sales of tobacco increased by the equivalent of 59 million cigarettes – after years of decline;

* ‘The black market for tobacco grew by 20 percent – profiting criminals while depriving the Australian taxpayer of AUS$1billion; and

* ‘The steady reduction of smoking rates that Australia had seen in recent years actually halved.’

Meanwhile, BAT said that it had included in its comprehensive submission to the UK’s standardized packaging consultation never-before-seen data from Australia that clearly showed such packaging had not achieved the Australian government’s public health objectives. This was said to be important data that Chantler had been offered access to but hadn’t include in his review.

‘In addition, our submission also contains a full critique of the Government’s Impact Assessment and the Chantler Report by Stephen Gibson, an independent expert in regulation and competition economics,’ BAT’s press note said.

‘As well as proving to be ineffective, plain packaging infringes on our legal rights as a business and fails to respect our minimum guaranteed rights regarding trade mark protection.

‘When the UK Government consulted on the idea of plain packaging in 2012, 64 percent of respondents rejected the idea. We understand that once again thousands of individuals and groups also oppose plain packaging and have made their views known.

‘Given the number of detailed responses that have been submitted, we are confident the UK Government will take the same meticulous approach to reviewing them as it did during its 2012 consultation. We hope that any policy announcement will be based on plain facts and evidence.’

BAT’s response to the UK government’s 2014 standardized packaging consultation is at:$FILE/medMD9MSETE.pdf?openelement.

100,000 petition against plain packaging

| August 11, 2014

A petition against standardized tobacco packaging in the UK has attracted more than 100,000 signatures, and more than 50,000 people have written personally to the Prime Minister opposing the initiative, according to a press note from the smokers’ group Forest.

Standardised packaging has been the subject of a final six-week consultation that closed on Thursday.

“The response demonstrates the enormous level of opposition to this ill-conceived measure,” said Simon Clark, director of Forest, which runs the Hands Off Our Packs campaign. “We urge the prime minister to think again.

“There’s no evidence standardised packaging will have any health benefits. Advocates base their arguments not on facts but on speculation.

“There must be no rush to legislation. It’s a huge step and no government should take it lightly.

“The UK government should not be gold plating EU regulations. Before introducing plain packaging ministers should wait and study the effectiveness of the EU’s revised Tobacco Products Directive that includes larger health warnings.”

Clark then widened the debate by saying there was genuine concern that if standardized packaging was introduced for tobacco, the same could happen in the case of alcohol, sugary drinks and confectionary.

“Government has to get off people’s backs and trust the consumer to make informed choices without unnecessary and unwelcome state intervention,” said Clark.

Growers left to the mercy of merchants

| August 11, 2014

Tobacco growers in Sumenep regency, East Java, are asking the local government to regulate the purchase price of tobacco in a bid to avoid what they described as ‘huge, protracted’ losses, according to an story.

“We are entering harvest time, yet there is still no word on the tobacco price range,” the chairman of Ganding Village Model Farmers Group, Syairi, was quoted as saying.

A regulated price range, he added, would help farmers determine the prices at which they should sell their tobacco to merchants. Without a regulated price, merchants tended to offer very low prices, regardless of the tobacco’s quality.

“We ask the government to set prices based on the amount of capital we spend,” said Syairi.

Meanwhile, it was reported that Heni Yulianto, of Sumenep’s Industry and Trade Bureau, had previously said that local governments could not regulate tobacco prices because tobacco was categorized as free goods, which meant that its price was determined by its quality and the level of demand from cigarette producers.

Nevertheless, Heni said local governments would continue to monitor the purchase price of tobacco. If prices were considered to be too low, the government, the Legislative Council, the Tobacco Farmers Association and representatives of cigarette producers would always hold discussions to find the best solution.

“That is all the government can do,” she said.

Lower tobacco volumes and lower prices hit Universal’s revenues in first quarter

| August 8, 2014

Universal Corp.’s net income during the first quarter to the end of June was $0.7 million, down from $58.3 million during the first quarter of last year.

Net income during the first quarter of last year included a gain of $81.6 million before tax ($53.1 million after tax) resulting from a favorable outcome of litigation by the company’s operating subsidiary in Brazil and related to previous years’ excise tax credits. Excluding that non-recurring gain, first quarter net income this year was down by $4.5 million.

Revenues for the first quarter of fiscal year 2015 of $271.5 million were down by 37.4 percent on a combination of lower volumes due to the later receipt of shipment instructions from customers and lower average prices.

“Our first quarter of fiscal year 2015 has been heavily influenced by lower volumes that are a result of typical oversupply market patterns, including a slow start in Brazil and later timing of customer orders and current crop shipments,” said George C. Freeman, III, chairman, president, and CEO. “In recent years, we have completed most of our shipments by the end of our fiscal year, reducing first quarter volumes from carryover crop shipments. Given this shift and the oversupply conditions, our reduced volumes in the first fiscal quarter were expected this year. A predominance of our shipments should occur in the second half of the fiscal year.

“Overall, customer orders are in line with our expectations, and based upon the current backlog of shipments, we anticipate that volumes for fiscal year 2015 will not be materially different from those of last year, barring any unexpected logistical challenges.

“Due to the current season’s production oversupply, we continue to take a measured approach to the remainder of fiscal year 2015. Markets have been developing slowly in some origins as customers have been monitoring market conditions while evaluating their leaf needs and inventory durations, and shipping has been progressing at a slower pace than normal.

“At the same time, we have been very deliberate in our purchases, making reductions where possible, and we are working to minimize uncommitted inventories, which at the end of June 2014 were within our normal range.

“We are not seeing the market pricing volatility that depressed margins in South America last year, and green leaf prices have declined this year in most origins. “Although it is very early, the current production outlook for next year’s crops indicates that leaf production will also decline, consistent with market correction patterns.”

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