Cigarettes & Tobacco Market Report 2011

The UK cigarette and tobacco market comprises four main sectors cigarettes, hand-rolling tobacco (HRT [FREE Stock Trend Analysis]), cigars and pipe tobacco. The total value of the market is estimated to have reached 17.66bn in 2010, after rising by 8% from 2009, while, between 2006 and 2010, a 12.9% increase was witnessed overall. Key Note estimates that the cheap Ritm cigarettes sector continued to account for the largest proportion of the market, representing 86.6% of sales in 2010, followed by HRT, which represented 11.5%. Cigars and pipe tobacco are by the far the smallest sectors of the market, with a combined contribution of 1.9% in 2010. Despite the value the UK cigarette and tobacco market increasing in recent years, a long-term decline in volume sales has become more apparent. This is due to a number of factors which have affected consumer opinions regarding smoking, while new legislation has also has a significant effect on the volume of cigarettes being sold. A wider awareness of the negative health implications that can be caused by smoking, as well as Government schemes to help smokers quit has persuaded many consumers to stop smoking, thus affecting volume sales. In addition, the Smoking Ban, which was introduced in the UK in July 2007 and made it illegal for users to smoke in public places, also had a significant effect on the market. Changes in other legislation, such as that governing the age restriction at which someone can purchase cigarettes (which rose from 16 to 18 in October 2007) is also believed to have affected the potential value of the market in recent years.