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NZ tax hike lifts interest in home-grown tobacco

| January 26, 2015

In the city of Tauranga, New Zealand, smokers who grow their own leaf tobacco are making money by using websites and social media pages to sell tobacco plant seeds to others looking to reduce their costs of smoking following a recent 10 percent tax hike.

According to a story by Rebecca Savory for the Bay of Plenty Times; while it is illegal in New Zealand to sell or gift home-grown tobacco plants, people can legally grow tobacco for their own use and sell and buy the seeds.

Individuals may process up to 15 kg of home-grown tobacco per adult per year for personal use. This equates to between 50 and 100 cigarettes per person per day, depending on tobacco content.

Savory reported that searches for tobacco seeds on Trade Me had recently increased by 10 percent on those of a year ago and that tobacco seeds comprised the top tobacco-related search during the past 12 months.

Commercial tobacco manufacturers are unlikely to take fright, however. Searches for tobacco seeds in New Zealand routinely increase through December and peak in the middle of January.

And interest in growing tobacco at home regularly increases with tobacco price hikes.

The main problem is that it is difficult to process a palatable tobacco product from home grown plants.

Whether or not home grown tobacco offers a health benefit or deficit is another story.

Second FDA e-cigarette workshop date announced

| January 26, 2015

The US Food and Drug Administration says that its second public workshop on electronic cigarettes is due to be held on March 9-10.

The first of a series of three planned workshops was held last year.

The agenda for the March 2015 workshop is said to focus on the impact of electronic cigarettes on a person’s ‘individual health’.

The specific topics to be discussed include:

(1) ‘exposure to nicotine, and toxicological considerations;

(2) ‘pharmacokinetics (the movement of drugs within the body) and pharmacodynamics (the effects of drugs) regarding nicotine exposure in users;

(3) ‘abuse and dependence;

(4) ‘short- and long-term health effects of using e-cigarettes;

(5) ‘considerations for high-risk or vulnerable populations; and

(6) ‘human factors.’

The FDA said the information obtained through this series of workshops would not impact its pending deeming regulations. However, if the deeming rule were finalized as proposed, then electronic cigarettes would be subject to FDA regulations and the agency could use the scientific information obtained from the series of workshops to propose additional regulations on electronic cigarettes.

Registration for in-person or by-webcast participation in the March workshop is open until February 20 at: https://www.surveymonkey.com/s/CTP-March-Workshop.

Online vintage cigar auction under way

| January 26, 2015

Cigar aficionados are now bidding in C.Gars’ online vintage cigar auction, which is due to end on February 1.

The auction includes 270 lots of vintage, mature and limited-edition Cuban and Dominican cigars and is expected to realize more than £300,000.

‘In 2014, 1,000 boxes of vintage cigars were auctioned by us, online and offline, achieving a 99.5 percent auction sales rate that is almost as rare as some of the cigars that were sold,’ said managing director Mitchell Orchant.

‘Our current auction, the UK’s first for 2015, includes some of the rarest and most magnificent pre-Embargo Havanas we have ever had the privilege of offering.

‘There is particular interest in the cabinet of 100 pre-Embargo Romeo y Julieta Coronations Deluxe (estimated £10,000-£12,000), and the box of 100 pre-Embargo Punch Double Coronas (estimated £9,000-£12,000).’

C.Gars’ online auction catalogue is available at: http://www.onlinecigarauctions.com/catalog/feb-2015/Online_vintage_cigar_auction_2015.pdf

Indian government measures hurting ITC

| January 26, 2015

ITC’s profit during the quarter that ended on December 31, at Rs26.35 billion, fell slightly short of analysts’ estimates of Rs26.92 billion as higher taxes on cigarettes and a government push to discourage tobacco consumption throughout India hurt sales, according to a Reuters story.

ITC, which accounts four out of every five cigarettes sold in India and which derives most of its revenue from cigarettes, is nearly 25 percent owned by British American Tobacco.

The impact of high taxes and duties was “exerting unprecedented pressure on legal (tobacco) industry sales volumes,” ITC was quoted as saying in a statement.

Prime Minister Narendra Modi’s government, which took office last year, has been adopting measures to curb India’s tobacco consumption.

It has increased taxes on tobacco products, ordered companies to place health warnings across 85 percent of the surface of cigarette packs and is considering banning the sale of single cigarettes, which make up about 70 percent of cigarette sales in the country.

Public should be told of vapor products’ advantages

| January 23, 2015

Vapor products seem to have hit a rocky patch in the US and it is possible that only well thought out regulation will help smooth the way ahead.

Bonnie Herzog, the managing director of Beverage, Tobacco & Convenience Store Research at Wells Fargo Securities, says that a survey her group had conducted among about 20,000 tobacco retailer and wholesaler contacts had thrown up a few ‘calls to action’.

They wanted the Food and Drug Administration to take the lead in better informing the public about the relative risks of vaping and smoking. They wanted the industry to work together to push for vapor products to be granted modified risk status so that the public perception of these products did not deteriorate further. And they wanted vape shops to be regulated more closely so that they did not undermine the industry’s reputation.

The survey uncovered also that retailers have been ‘somewhat underwhelmed’ by the larger devices that are coming on to the market and that are meant to bridge the gap between traditional electronic cigarettes and VTMs. Retailers believe that about 75 percent of the sales of these products will cannibalize existing sales rather than generate incremental sales.

Nevertheless, Herzog said she remained cautiously optimistic by technological innovation in the vapour-products category.

And she remains bullish long term, believing that the consumption of vapor and other non-combustibles, such as heat-not-burn products, could surpass consumption of combustible cigarettes by 2023. ‘We continue to believe that technological innovation is crucial and that Big Tobacco will be pivotal in shaping the non-combustible nicotine industry,’ she wrote.

Her bullish stance is not altogether surprising. Herzog reported that vapor category growth in c-stores remained robust: at 17 percent in the fourth quarter of last year, though down on the 21 percent the third quarter. Repeat vapor product purchases are said to have accelerated to 60 percent in the fourth quarter from 57 percent in the third quarter. 

 

Plain packs proposal “a serious error of judgement”

| January 23, 2015

Legislation aimed at imposing in the UK standardized packaging for cigarettes and fine-cut tobacco is due to be put before parliament during the current session, which is scheduled to end on March 30.

Many observers had assumed that the legislation would not be introduced until after May 7, when the UK is due to go to the polls in a general election.

Imperial Tobacco said in a note posted on its website that it was ‘surprised and disappointed by the government’s decision to rush ahead with plain packaging legislation’.

‘After two years of the failed experiment in Australia there remains no credible evidence that plain packaging is having any impact on tobacco consumption rates,’ the note said.

‘Illicit trade, however, has increased significantly.

‘It is regrettable that this issue has been caught up in knee-jerk electioneering at the expense of evidence-based policy making.

‘As we’ve always said, we have a fundamental right to differentiate our brands from those of competitors. Legal action is always a last resort but when legislation is published we will be considering our options.’

If the legislation is passed, it is likely to come into force in May 2016, along with the provisions of the revised EU Tobacco Products Directive, which does not call for standardized packaging.

A British American Tobacco spokesperson described the proposal as “a serious error of judgment given the clear evidence from Australia that plain packaging has not achieved any of its public health objectives and has increased illicit trade to its highest level in seven years”.

“It is also inappropriate for the UK government to pre-empt the findings of its own public consultation by rushing this announcement out.”

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