While cigarettes were recording declining volume sales in 2023, positive growth was being seen in real value terms, helped in no small part by an ongoing trend towards premium brands in China, the region’s dominant market. However, e-vapour products saw another major decline due to the raft of new regulations on these products in China. Heated tobacco continued to record strong growth, with Japan remaining the biggest market for these products globally.
This report comes in PPT.
With the Chinese authorities actively pursuing a policy of curbing the supply of low-end and cheap products and increasing the penetration of premium brands, this is seeing cigarettes recording a stronger performance in real value terms than in volume terms, with the latter only seeing a very modest increase in 2023.
Legal cigarettes saw a significant decline in volume sales in Indonesia in 2023. The Indonesian government increased the excise tax by an average of 10% for cigarettes at the start of the year. With global uncertainty and a weakening rupiah, consumer spending was constrained by falling disposable incomes. Cigarette smokers became more budget conscious, which negatively impacted overall volume sales of legal cigarettes during the year.
The ban on flavours in e-vapour products will continue to undermine the e-vaping market in China – and therefore also the whole region – in the coming years. With e-vapour products banned in Hong Kong, India, Singapore, Taiwan and Thailand, this will also serve to limit the potential of this category in Asia Pacific.
In Japan and South Korea, Asia Pacific houses the first and fourth biggest heated tobacco markets globally, with both expected to continue growing in the coming years. Dynamic performances are expected in relatively new heated tobacco markets like the Philippines, although the absence of heated tobacco products in the region’s two most populous nations (China, India) will continue to limit this category’s development over the forecast period.
Passport Tobacco covers the seven major tobacco categories: Cigarettes, Cigars & Cigarillos, Smoking tobacco (made up of Pipe tobacco and RYO tobacco), Smokeless Tobacco (snuff and chewing tobacco), E-Vapour Products (closed and open); Heated Tobacco; and Tobacco Free Oral Nicotine. Smoking paraphernalia such as pipes, rolling papers, lighters or matches, etc., are not included, nor are nicotine replacement therapy (NRT) products, which are part of Euromonitor's Passport Consumer Healthcare database.
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