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tobacco industry south africa

The Tobacco Industry in South Africa 2021

Gary Phillips | South Africa | 25 August 2021

The Tobacco Industry in South Africa 2019

Nina Shand | South Africa | 05 July 2019

The Tobacco Industry in South Africa 2018

Nina Shand | South Africa | 26 March 2018

The Tobacco Industry in South Africa 2015

Juliet Gebbie | South Africa | 10 November 2015

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Report Coverage

This report focuses on the South African tobacco and tobacco products industry and contains comprehensive information on the state and size of the sector, trade, corporate actions and regulations. It includes information on the major players in manufacture and retail, the rapidly-growing illicit market, e-cigarettes and health and environmental concerns. There are profiles of 24 companies including major players such as British American Tobacco, JT International and Philip Morris, e-cigarette companies such as Vape Manufacturing and Distribution and Limpopo Tobacco Processors, South Africa’s only green leaf processor.

The South African Tobacco and Tobacco Products Industry

After more than a decade of pressure from increasing government tobacco controls, a growing illicit cigarette economy and changing consumer attitudes towards smoking, South Africa’s Tobacco industry was subjected to a twenty-week prohibition on the sale of all raw tobacco leaf, processed tobacco and all manufactured tobacco products under lockdown measures. This led to the industry losing significant market share to illicit cigarette sales. The industry also faced an 8% increase in excise duties and announcements of renewed government efforts to finalise further tobacco controls.

E-cigarettes

The e-cigarette industry is estimated to be growing at a compound annual rate that is more than double that of traditional cigarettes, cigars and roll-your-own tobacco. But the industry is very small compared to manufactured tobacco products. As all hardware devices, replacement parts and components and most of the e-liquids are imported, future growth will largely be in distribution, wholesale and retail. The industry has mostly developed through specialist stalls or mall kiosks although vaping products are also sold in supermarkets.

Tobacco Controls

Tobacco is highly controlled through price and non-price controls. The Control of Tobacco Products and Electronic Delivery Systems Bill, drafted in 2018 but not yet enacted, proposes stringent controls including the removal of all signage and logos on cigarette packaging aside from the brand name and warning stickers, and that cigarettes may no longer be displayed by retailers. The proposed new controls also include regulating and taxing e-cigarettes for the first time in South Africa.

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The Tobacco Industry in South Africa 2021

Full Report

R 6 500.00(ZAR) estimated $343.74 (USD)*

Industry Overview

R 4 550.00(ZAR) estimated $ 240.62 (USD)*

Industry Organograms

Historical Reports

The Tobacco Industry in South Africa 2019-07-05

R 1 900.00(ZAR) estimated $100.48 (USD)*

View Report Add to Cart

The Tobacco Industry in South Africa 2018-03-26

R 1 900.00(ZAR) estimated $100.48 (USD)*

View Report Add to Cart

The Tobacco Industry in South Africa 2015-11-10

R 1 900.00(ZAR) estimated $100.48 (USD)*

View Report Add to Cart

Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 2
2.1. Industry Value Chain 4
2.2. Geographic Position 8
3. SIZE OF THE INDUSTRY 9
4. STATE OF THE INDUSTRY 16
4.1. Local 16
4.1.1. British American Tobacco South Africa 17
4.1.2. Tobacco Control and Regulations 20
4.1.3. Trade 24
4.1.4. Corporate Actions 34
4.1.5. Enterprise Development and Social Economic Development 35
4.2. Continental 36
4.3. International 40
5. INFLUENCING FACTORS 47
5.1. Coronavirus 47
5.2. Economic Environment 49
5.3. The Growth of the Illicit Market 51
5.4. Technology, Research and Development (R&D) and Innovation 55
5.5. Health and Environmental Concerns 57
5.6. Labour 58
6. COMPETITION 63
6.1. Barriers to Entry 64
7. SWOT ANALYSIS 64
8. OUTLOOK 65
9. INDUSTRY ASSOCIATIONS 66
10. REFERENCES 66
10.1. Publications 66
10.2. Websites 69
APPENDIX 1 70
Summary Of Notable Players 70
ORGANOGRAM – MANUFACTURE OF TOBACCO PRODUCTS 75
ORGANOGRAM – WHOLESALE TRADE IN TOBACCO PRODUCTS 77
COMPANY PROFILES 79
AFROBERG TOBACCO MANUFACTURING (PTY) LTD 79
AMALGAMATED TOBACCO MANUFACTURING (PTY) LTD 80
BEST TOBACCO COMPANY (PTY) LTD 82
BRITISH AMERICAN TOBACCO SOUTH AFRICA (PTY) LTD 83
CARNILINX (PTY) LTD 86
FLUE CURED TOBACCO RESEARCH COMPANY (RF) NPC 88
FOLHA MANUFACTURERS (PTY) LTD 89
GOLD LEAF TOBACCO CORPORATION (PTY) LTD 90
HOME OF CUT RAG (PTY) LTD 92
IMPTOB SOUTH AFRICA (PTY) LTD 94
JT INTERNATIONAL SOUTH AFRICA (PTY) LTD 95
LEONARD DINGLER (PTY) LTD 97
LIMPOPO TOBACCO PROCESSORS (PTY) LTD 99
LOWVELD AGRI RESEARCH AND SUPPORT SERVICES (PTY) LTD 101
OTP DISTRIBUTORS (PTY) LTD 102
PACIFIC CIGARETTE COMPANY (PTY) LTD (THE) 104
PHILIP MORRIS SOUTH AFRICA (PTY) LTD 106
TOBACCO PRODUCER DEVELOPMENT (PTY) LTD 108
TWISP (PTY) LTD 109
UNIVERSAL LEAF SOUTH AFRICA (PTY) LTD 110
VAN ERKOMS TABAKKE (PTY) LTD 111
VAPE AFRICA (PTY) LTD 113
VAPE MANUFACTURING AND DISTRIBUTION (PTY) LTD 115
VAPERITE (PTY) LTD 117

Report Coverage

This report covers the tobacco manufacturing industry, including the size and state of the industry and the factors that influence it. These include detailed descriptions of proposed legislation, the illicit tobacco trade and the e-cigarette market. There are profiles of 16 companies including British American Tobacco South Africa which is estimated to hold 74% of the legal market and 22 out of around 30 brands. There are also profiles of Philip Morris, with leading brands Marlboro and Chesterfield, and its subsidiary Leonard Dingler, which manufactures products such as pipe tobacco and snuff. Other profiles include Limpopo Tobacco Processors, the biggest single supplier of tobacco leaves to local buyers.

The Tobacco Industry

The tobacco manufacturing industry in South Africa, that is estimated to be worth close to R30bn and supported by nearly 8 million adult tobacco users, continues to be seriously affected by the rampant growth in illicit cigarettes. The number of legally-declared cigarettes declined more than 20% between 2013 and 2018, while industry sources say the illegal trade grew to 33% of the total market in 2018. The industry contributed R10.9bn in excise duty to the fiscus in 2017/2018, a decline of nearly R2bn from 2015/16, despite increased taxes.

Multiple Challenges

The rampant illicit trade in cigarettes is blamed for the reduction in cigarette sales volumes of multinational tobacco companies and lower leaf orders to the estimated 176 commercial tobacco farmers and 155 small-scale farmers. At the same time, the e-cigarette market is estimated to have grown to be worth R1bn, but faces regulation in the form of the proposed Control of Tobacco Products and Electronic Delivery Systems Bill. Another key issue facing the industry is government’s plan to further tighten legislation on smoking and the introduction of plain packaging. Health concerns associated with tobacco are expected to continue to affect consumption.

Read More..
The Tobacco Industry in South Africa 2019

Full Report

R 1 900.00(ZAR) estimated $100.48 (USD)*

Industry Overview

R 1 330.00(ZAR) estimated $ 70.34 (USD)*

Historical Reports

The Tobacco Industry in South Africa 2021-08-25

R 6 500.00(ZAR) estimated $343.74 (USD)*

View Report Add to Cart

The Tobacco Industry in South Africa 2018-03-26

R 1 900.00(ZAR) estimated $100.48 (USD)*

View Report Add to Cart

The Tobacco Industry in South Africa 2015-11-10

R 1 900.00(ZAR) estimated $100.48 (USD)*

View Report Add to Cart

Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 2
2.2. Geographic Position 4
3. SIZE OF THE INDUSTRY 5
4. STATE OF THE INDUSTRY 8
4.1. Local 8
4.1.1. Corporate Actions 11
4.1.2. Regulations 12
4.1.3. Enterprise Development and Social Economic Development 14
4.2. Continental 16
4.3. International 19
5. INFLUENCING FACTORS 23
5.1. Economic Environment 23
5.2. Health Concerns 24
5.3. Proposals to Ban the Growing of Tobacco 25
5.4. Regulations 25
5.5. Illicit Trade 26
5.6. Technology, Research and Development (R&D) and Innovation 28
5.7. Labour 30
5.8. Environmental Concerns 32
6. COMPETITION 33
6.1. Barriers to Entry 34
7. SWOT ANALYSIS 35
8. OUTLOOK 36
9. INDUSTRY ASSOCIATIONS 36
10. REFERENCES 36
10.1. Publications 36
10.2. Websites 37
APPENDIX 1 39
Summary of Notable Players 39
COMPANY PROFILES 44
AFROBERG TOBACCO MANUFACTURING (PTY) LTD 44
AMALGAMATED TOBACCO MANUFACTURING (PTY) LTD 45
BEST TOBACCO COMPANY (PTY) LTD 47
BRITISH AMERICAN TOBACCO SOUTH AFRICA (PTY) LTD 48
CARNILINX (PTY) LTD 51
FOLHA MANUFACTURERS (PTY) LTD 53
GOLD LEAF TOBACCO CORPORATION (PTY) LTD 54
HOME OF CUT RAG (PTY) LTD 56
JT INTERNATIONAL SOUTH AFRICA (PTY) LTD 58
LEONARD DINGLER (PTY) LTD 60
LIMPOPO TOBACCO PROCESSORS (PTY) LTD 62
OTP DISTRIBUTORS (PTY) LTD 64
PHILIP MORRIS SOUTH AFRICA (PTY) LTD 66
PROTOBAC (PTY) LTD 68
UNIVERSAL LEAF SOUTH AFRICA (PTY) LTD 69
VAN ERKOMS TABAKKE (PTY) LTD 71

Report Coverage

The report on the South African tobacco industry describes current conditions and factors influencing the success of the industry, including government plans to further tighten legislation and the introduction of plain packaging. The negative effect of the severe drought and exceedingly hot temperatures in some areas as well as the continued illicit trafficking of cigarettes are also discussed. The report profiles 15 companies, including the three major players and smaller players such as Folha Manufacturers and Afroberg Tobacco Manufacturing. Also profiled is Gauteng-based Gold Leaf Tobacco Corporation which announced in 2017 that it planned to set up a US$1.5m plant in Harare, Zimbabwe within two years.

The South African Tobacco Industry

The South African tobacco industry is estimated to be worth R28.8bn and is supported by 8.2 million adult tobacco users. It is a significant contributor to the government purse, paying more than R16.6bn in excise duty and VAT in the 2016/2017 marketing season. The primary sector of the industry involves commercial and small-scale tobacco farmers situated in Limpopo, North West, Mpumalanga, Eastern Cape and Western Cape. The secondary sector focuses on the manufacture and marketing of cigarettes, pipe tobacco and snuff to the consumer. Limpopo Tobacco Processors is the biggest supplier of leaf and sells about 95% of its flue-cured tobacco to British American Tobacco, the main manufacturer in the sector.

Declining Sales

According to British American Tobacco South Africa, over the last five years company cigarette sales decreased from 22 billion to 15 billion sticks. This was the result of ‘downtrading’ to the low-priced segment of the market and higher illicit trade which remains a threat to both tobacco farmers and manufacturers. There was a 15% reduction in the domestic order for tobacco for the 2017/18 growing season and statistics from the Tobacco Institute of Southern Africa show that since 2012 tobacco manufacturers have bought 2,000 tons less tobacco leaf.

Read More..
The Tobacco Industry in South Africa 2018

Full Report

R 1 900.00(ZAR) estimated $100.48 (USD)*

Industry Overview

R 1 330.00(ZAR) estimated $ 70.34 (USD)*

Historical Reports

The Tobacco Industry in South Africa 2021-08-25

R 6 500.00(ZAR) estimated $343.74 (USD)*

View Report Add to Cart

The Tobacco Industry in South Africa 2019-07-05

R 1 900.00(ZAR) estimated $100.48 (USD)*

View Report Add to Cart

The Tobacco Industry in South Africa 2015-11-10

R 1 900.00(ZAR) estimated $100.48 (USD)*

View Report Add to Cart

Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 2
2.2. Geographic Position 4
3. SIZE OF THE INDUSTRY 5
4. STATE OF THE INDUSTRY 12
4.1. Local 12
4.1.1. Corporate Actions 15
4.1.2. Regulations 15
4.1.3. Enterprise Development and Social Economic Development 17
4.2. Continental 19
4.3. International 21
5. INFLUENCING FACTORS 24
5.1. Economic Environment 24
5.2. Health Concerns 25
5.3. Proposals to Ban the Growing of Tobacco 25
5.4. Regulations 26
5.5. Illicit Trade 27
5.6. Technology, Research and Development (R&D) and Innovation 28
5.7. Labour 30
5.8. Environmental Concerns 31
6. COMPETITION 33
6.1. Barriers to Entry 34
7. SWOT ANALYSIS 34
8. OUTLOOK 35
9. INDUSTRY ASSOCIATIONS 35
10. REFERENCES 36
10.1. Publications 36
10.2. Websites 36
COMPANY PROFILES 38
AFROBERG TOBACCO MANUFACTURING (PTY) LTD 38
AMALGAMATED TOBACCO MANUFACTURING (PTY) LTD 39
BEST TOBACCO COMPANY (PTY) LTD 41
BRITISH AMERICAN TOBACCO SOUTH AFRICA (PTY) LTD 42
CARNILINX (PTY) LTD 45
FOLHA MANUFACTURERS (PTY) LTD 47
GOLD LEAF TOBACCO CORPORATION (PTY) LTD 48
HOME OF CUT RAG (PTY) LTD 50
JT INTERNATIONAL SOUTH AFRICA (PTY) LTD 51
LEONARD DINGLER (PTY) LTD 53
LIMPOPO TOBACCO PROCESSORS (PTY) LTD 55
OTP DISTRIBUTORS (PTY) LTD 57
PHILIP MORRIS SOUTH AFRICA (PTY) LTD 59
PROTOBAC (PTY) LTD 61
UNIVERSAL LEAF SOUTH AFRICA (PTY) LTD 62
VAN ERKOMS TABAKKE (PTY) LTD 64

Report Coverage

The report on the South African tobacco industry describes the current market and developments in the e-cigarette sector and focuses on factors influencing the success of the industry. The report profiles ten companies, including the dominant British American Tobacco, which manufactures 27 billion cigarettes per annum for the domestic and international markets and has a local market share of approximately 85%. Also profiled is local company, Carnilinx (Pty) Ltd t/a CTC, which manufactures a number of less expensive brands, and Philip Morris South Africa (Pty) Ltd, importer of well-known brands, Chesterfield and Marlboro.

The South African Tobacco Industry

This report focuses on the South African tobacco industry, which is valued at R29bn and contributes more than R12bn in excise duty and VAT per annum. Although there are still an estimated 186 commercial tobacco farmers in South Africa, both the area under tobacco cultivation and tobacco production have dropped markedly since the turn of the century. The substantial decline in domestic production of tobacco has led to rising imports of leaf tobacco and South Africa is now one of the biggest buyers of Zimbabwean leaf.

Increasing Pressures on the sector

The local industry is finding itself under increasing pressure. One of the key issues facing the sector is tightening legislation with regard to smoking. South Africa’s most recent proposed regulatory changes include plain packaging requirements as introduced in Australia in 2012. In addition, the South African government is keen to adopt further control measures before the World Conference on Tobacco or Health to be held in South Africa in 2018. Added to legislative pressures is the illegal trafficking of cigarettes. Locally illicit trading is estimated to account for 23% of the tobacco market and has cost the country more than R21bn in revenue since 2010. The hijacking of vehicles transporting legal tobacco products is also becoming an issue of increasing concern, with British American Tobacco South Africa announcing that approximately 1,400 of its trucks are hijacked every year.

Read More..
The Tobacco Industry in South Africa 2015

Full Report

R 1 900.00(ZAR) estimated $100.48 (USD)*

Industry Overview

R 1 330.00(ZAR) estimated $ 70.34 (USD)*

Historical Reports

The Tobacco Industry in South Africa 2021-08-25

R 6 500.00(ZAR) estimated $343.74 (USD)*

View Report Add to Cart

The Tobacco Industry in South Africa 2019-07-05

R 1 900.00(ZAR) estimated $100.48 (USD)*

View Report Add to Cart

The Tobacco Industry in South Africa 2018-03-26

R 1 900.00(ZAR) estimated $100.48 (USD)*

View Report Add to Cart

Table of Contents

[ Close ]
PAGE
1. INTRODUCTION 1
2. DESCRIPTION OF THE INDUSTRY 1
2.1. Industry Value Chain 2
2.2. Geographic Position 3
3. SIZE OF THE INDUSTRY 4
4. STATE OF THE INDUSTRY 8
4.1. Local 8
4.1.1. Corporate Actions 10
4.1.2. Regulations 11
4.1.3. Enterprise Development and Social Economic Development 12
4.2. Continental 12
4.3. International 13
5. INFLUENCING FACTORS 15
5.1. Economic Environment 15
5.2. Health Concerns 15
5.3. Proposals to Ban the Growing of Tobacco 16
5.4. Illicit Trafficking 16
5.5. Regulations 17
5.6. Technology 18
5.7. Research and Development (R&D) 19
5.8. Innovation 19
5.9. Labour Resources 20
5.10. Environmental Concerns 22
6. COMPETITION 23
7. SWOT ANALYSIS 24
8. OUTLOOK 24
9. INDUSTRY ASSOCIATIONS 25
10. REFERENCES 25
10.1. Publications, Podcasts and Youtube 25
10.2. Websites 26
COMPANY PROFILES 27
AMALGAMATED TOBACCO MANUFACTURING (PTY) LTD 27
BRITISH AMERICAN TOBACCO SOUTH AFRICA (PTY) LTD 29
CARNILINX (PTY) LTD 32
GOLD LEAF TOBACCO CORPORATION (PTY) LTD 34
JT INTERNATIONAL SOUTH AFRICA (PTY) LTD 36
LEONARD DINGLER (PTY) LTD 38
OTP DISTRIBUTORS (PTY) LTD 40
PHILIP MORRIS SOUTH AFRICA (PTY) LTD 42
UNIVERSAL LEAF SOUTH AFRICA (PTY) LTD 44
VAN ERKOMS TABAKKE (PTY) LTD 46