Cigarette sales are expected to maintain their long-term declining trend over the forecast period, with this category’s performance being negatively impacted by annual tax excise increases and consumers switching to next-generation alternatives. The war-related high inflation and lower purchasing power for local consumers will also see smokers of economy segment cigarettes switch to illicit trade.
There will likely be an improvement in the local manufacturing and retail operations as industry players adapt to the wartime circumstances in Ukraine or there is an end to the war at some point over the forecast period. Philip Morris is building a new production facility in the western part of the country, for example, while modern grocery retailers will continue to develop the distribution landscape.
There is not expected to be a premiumisation trend in cigarettes in Ukraine over the forecast period, for a number of reasons. These include the entering into force from July 2023 of new Law No 4358, which will ban all flavoured cigarettes in Ukraine, including capsules; the loss of a significant part of the population, including many middle- or upper-income consumers; decreased disposable incomes due to the impact of the war as well as the currently high inflation rates; and some smokers shifting to heated tobacco and e-vapour products.
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Understand the latest market trends and future growth opportunities for the Cigarettes industry in Ukraine with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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Cigarettes
RETAIL SALES OF DUTY PAID CIGARETTES The definition of cigarettes for the purposes of this study is duty-paid, machine manufactured white-stick products. This does not exclude brands of cigarettes that do not use white paper but it is designed to exclude the volume of non-machine manufactured products such as bidis/beedis (India) and papirosy (Russia), and other smoking products made with tobacco but that either do not resemble cigarettes as recognised in the US or Europe, or those that are not machine manufactured. The exclusion of these products is intended to give a more accurate picture of the "true" market for cigarettes and cigars which has been distorted in official statistics and published reports because of the inclusion of hybrid products. NB Please note that due to its central importance and integration into the industry mainstream, Indonesia’s market data does include hand-rolled kreteks DUTY-FREE sales are excluded from retail sales, as are herbal cigarettes. ILLICIT TRADE CIGARETTES Not included in retail sales, but split out separately in volume terms only. Defined as non-duty paid cigarettes (includes smuggled & counterfeit/fake products combined). Legitimate cross-border sales are considered duty-paid. Sales arising from a foreign national purchasing cheaper cigarettes in bulk in a neighbouring country for personal use and exported back are attributed to the country where the purchase is made (e.g. bulk cigarette sales by British nationals in France are attributed to France).
See All of Our DefinitionsThis report originates from Passport, our Cigarettes research and analysis database.
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