Russians familiarity with tobacco dates back to 16-17 century. In the year 1634, tobacco was strictly banned in Moscow and consumers were imposed with a penalty of capital punishment. Later on, the Russian government controlled tobacco purchasing from other countries. By the middle of 19th century in Moscow, four large tobacco factories were established to enhance the growth of tobacco production and tobacco has become an integral part of the Russian population. Japan Tobacco is the leading player in the Russia with well-known brands, frequent innovations, innovative new products and an extensive distribution network. Lane (Scandinavian Tobacco) is the leading player in cigars and cigarillos followed by Al Fakher and Mac Baren. Traditional grocery retailers are the majority leading distribution channels for cigarettes, cigars, cigarillos and smokeless tobacco.
Russian Federation is involved in the tobacco control policy by raising tobacco excise taxes, implementing smoke-free law, ban on tobacco advertising or promotion, and warning labels on tobacco product packaging. The Federation banned smoking in all public places such as trains, hotels/bars, cafes, and playgrounds. Sale of tobacco is also banned via kiosks since mid-2014 leading to reduced tobacco outlets in the country. Tobacco was popular in Russia for more than 400 years and it was not the first time smoking restrictions were imposed.
Russian tobacco industry registered a negative retail volume CAGR in the years 2011 to 2016 due to inflation and reduced consumer disposable incomes. The increased rate of excise duty on tobacco products has led to inflation and smoking less affordable for many consumers. Thus, decline in both the number of smokers and smoking frequency in Russia. It is expected that there will be a decline in the tobacco volume sales over the coming years. However, the sales of vapour products, smoking tobacco, cigars and cigarillos remained constant compared to cigarettes.
According to the study “Tobacco in Russia”, every year, an estimate of four hundred thousand Russians including men, women and youngsters are killed by tobacco-caused diseases. It is estimated that the tobacco’s death toll will increase each passing year. Majority of the Russian consumers are also concerned about the impact of smoking on their health. In Russia, vascular disease mortality is an increasing trend among middle aged men addicted to tobacco. The cigarettes packs in Russia are cheap compared to the rest of the world. Russian legislation has designed the small cigarette packs with a maximum of 20 sticks and larger packs with 25-30 cigarette sticks. The large packs witnessed a strong growth compared to the small packs due to lower price per stick. Vapour products were unaffected in any way and distributors focused on offering the leading global brands. Vardeks and Safe smoking are the leading players in vapour products.
Smokeless tobacco in Russia was promoted by various multinationals in the year 2009. The leading player in Russia was GN Tobacco that imported the product from Swedish-style snus and Oden’s was a well known brand for its quality. Initially smokeless tobacco products were very limited and were only distribution in major cities. The Russian consumers were attracted towards smokeless tobacco due to smoking ban and excise tax. This trend witnessed a rapid growth in smokeless tobacco of over 51% retail volume CAGR and continued growing over the coming years. However, Russia banned sales of a portion of Swedish-style snus in the year 2016 January. An average of seventy hundred thousand of the Russian population is using smokeless tobacco.
The Russian tobacco companies’ future market is still very optimistic with half of the population still addicted to smoking tobacco rather than vodka.
Key Topics Covered in the Report:
Sales of Tobacco in Russia
Russia Tobacco Industry Analysis
Sales of Vapour Products in Russia
Sales of Cigars and Cigarillos in Russia
Cigarettes Sales by Type of Tobacco
Sales of Cigarettes by Pack Size
Sales of Smokeless Tobacco in Russia
Russia Tobacco Products Market Research Forecast
Russia Cigarettes Industry Forecast
Vapour Products Market in Russia
Russia Smokeless Tobacco Industry Analysis
Russia Cigars and Cigarillos Industry Research Report
For more information on the market research report please refer to the below link:
Related Reports by Ken Research
Ankur Gupta, Head Marketing & Communications