What's Happening with the Tobacco Industry in 2021

Written by: Peter Minkoff

The previous year was a difficult one for many industries and business leaders around the world. The COVID-19 pandemic has brought many uncertainties to various residential, commercial, and government sectors. Some businesses have had to close their doors for good while others were able to stay afloat. The tobacco industry, for better or worse, was able to stay on an even keel up until now, but in 2021 we might witness a considerable uptick in sales, innovation, and investments.

There is no denying that the tobacco industry is still growing around the world, but it seems that the leading brands are beginning to assume a more eco-conscious and health-minded role. Let’s take a closer look at the current state of the tobacco industry and what we can expect to happen as 2021 continues to unravel.

Development of new products

Cigarette use around the world is still high, even though smoking as a habit has been on the decline in recent decades. Younger generations are certainly more mindful of the harmful effects of smoking tobacco, and are either boycotting smoking or choosing less hazardous products. Predominantly, younger generations are choosing products that are less harmful to their health, and bring more variety to their lives.

This has prompted the tobacco companies to kick-start the innovation process and push for the production of novel nicotine products. Firstly, traditional cigarettes are nowadays produced with higher-quality tobacco and nicotine, using higher production standards to eliminate harmful chemicals and lower their impact on health. But that certainly doesn’t make them healthy.

In fact, smoking cigarettes is still one of the worst things you can do for your health, so tobacco companies are increasingly pushing for heated tobacco products (HTP) like IQOS, as well as branded face masks and even sanitizers to promote their brands. While the ethics of these promotion methods are questionable at the very least, there is no denying that the industry is pushing for more innovation.

The push towards sustainable development

In order to get on the good side of modern consumers as well as governments and regulatory bodies, tobacco companies have had to adopt a more eco-conscious approach. Environmentalism has become a big part of the tobacco industry nowadays, even though the companies are far from any type of carbon neutrality. Still, improved production processes and the use of more sustainable materials will lower the impact of tobacco products to a degree.

The bigger push for sustainable investing is seen through equality, fair trade, and the aim to minimize worker exploitation. The motive behind this is, of course, not to end inequality or worker exploitation, but to create an image of sustainability and ethical conduct that will appeal to the consumers and pacify the policymakers around the world. While the motives are wrong, the end result will bring more equality and justice to the sector.

Vaping is taking over the industry

The need to promote their brands to younger, health-oriented generations has spurred the development and production of new nicotine products. While refining the traditional products is still a priority for many, smaller manufacturers are focusing on the production of vaping products that come in various types and bring new flavors to the market.

Now that vaping has become popular around the world, this year we will see vaping take over the industry, with the best disposable vape pen out there being sold as an alternative to the notoriously unhealthy cigarettes and traditional tobacco products. Disposable vapes fit the hectic modern lifestyle of younger generations, and they can be disposed of in an eco-conscious way, which allows companies to delve deeper into the millennial and Gen Z markets this year.

The pandemic has made a big impact

With the travel bans around the world still in effect, it’s easy to see that the pandemic has had a significant impact on the tobacco industry as a whole. For one, it has become drastically more difficult for illegal tobacco products to find their way into the marketplace abroad, which has increased the sales and taxation of legal tobacco products in many countries around the world.

This has benefited the companies and the governments, but it has definitely not been good to the average consumer, as tobacco prices have gone up around the world. While smuggling tobacco has been reduced because of the pandemic, it’s still important to note that cigarette sales and use are on the rise.

Cigarette sales have gone up in lockdown

For many tobacco companies, cigarette sales have gone up significantly during lockdown. For others, like the British American Tobacco company, sales have gone down but profits have soared. One notable trend is that the sale of cigars is also on the rise.

While cigars are typically associated with celebrations and special occasions, experts theorize that cigar sales are up simply because people are spending more time stuck at home, and are more likely to enjoy a lengthier smoking experience. Either way, if the lockdown persists, we can expect the sales of tobacco products to rise throughout the year.

Wrapping up

Smoking is bad for you and the people around you, but the tobacco industry seems to be persevering throughout the years. The current state of the tobacco industry indicates that new products will continue to hit the global market, but that there is room for higher sustainability and innovation.

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