Adroit Market Research - Industry Insights

Tobacco packaging enhances and protects the quality and flavor of the tobacco from deterioration and spoilage during the transportation of the tobacco products. Some of the most widely used packing materials are foils, metal cans, jute bags, laminates, plastic based films, paperboards, etc. Bulk and commercial packaging of tobacco includes various types of packaging such as shells, hinge-lid containers, bundle wraps, slides and several types of flexible packaging material such as shrink sleeves, flip top packs, stand-up pouches, and three-sided seal bags. With the rise in the demand for tobacco pr

Tobacco packaging enhances and protects the quality and flavor of the tobacco from deterioration and spoilage during the transportation of the tobacco products. Some of the most widely used packing materials are foils, metal cans, jute bags, laminates, plastic based films, paperboards, etc. Bulk and commercial packaging of tobacco includes various types of packaging such as shells, hinge-lid containers, bundle wraps, slides and several types of flexible packaging material such as shrink sleeves, flip top packs, stand-up pouches, and three-sided seal bags. With the rise in the demand for tobacco products the market for tobacco packaging market is projected to grow. Mullen (1979) explains that ‘heavily decorated wooden cabinets displayed a range of loose cigarettes in the tobacconist’s shop in sliding drawers behind a glass front, which would be weighed up and tipped into small envelopes.

In the recent years, Tobacco packaging has witnessed a significant penetration owing to the growing demand and consumption of cigarettes all over the world. Growing young population and stressful lifestyle have accelerated the consumption of cigarettes and other tobacco products during the past few years. Additionally, growing influence of western culture and social media, and tobacco products promotion by movie and TV stars is expected to fuel the tobacco consumption and directly impact the tobacco packaging market over the forecast period. Growing urbanization and increased popularity of cigarettes among the youth are some of the main reasons for the industry to gain such popularity.

The rise in production through the expansion of manufacturing capacities has led to a proliferation in the industry. The onset of hectic schedule and increased workload, are major reasons boosting the intake of tobacco among the professionals and working population. Tobacco contains nicotine which acts as an anti-depressant and a stimulant and helps the professionals to cope with the daily challenges. Additionally, nicotine have addictive properties and can make users tobacco dependent, due to which there is a spike in the cigarette sales and has impacted the tobacco packaging market in a positive way, fuelling the market growth in the coming years.

Growing urban population coupled with product uniqueness such as the introduction of demi-slim and super-slim cigarettes for women, RYOC (Roll-Your-Own-Cigarettes), miniature, additive free, mint and other flavored cigarettes are further boosting the demand for tobacco, and simultaneously driving the tobacco packaging market. Additionally, several design innovations such as slide opening packs, curved edge packs, and limited-edition packs which are launched to attract and appeal the interests of the customers are further estimated to drive the global tobacco packaging market significantly over the forecast period.

Rising consumption of cigarettes among the female population is expected to drive the market for tobacco packaging over the forecast period. Growing workload, stress and responsibilities majorly in urban areas is also fuelling the market growth for cigarettes, which is directly driving the tobacco packaging market. Additionally, use of anti-depressants such as cigarettes to get rid of stress, will drive the market growth in the coming years.

On the basis of product segment, the market is categorized into Bulk, Primary, and Secondary. Secondary packaging segment is expected to dominate the global Tobacco packaging market. Demand for inventive cigarette boxes and the emergence in the cigarette consumption while socializing is expected to drive the market growth. Original packing and the tobacco products both are well protected by the secondary packing. Such packaging are used while transportation, wholesale, and storage, thereby driving the segment growth.

On the end user basis, the market is bifurcated into paper boxes, metal, and others. According to a survey done by the WHO, there are more than 1.1 billion cigarette smokers in the world, mainly living in developing and middle-income nations. Furthermore, manufacturers are trying to add various flavours such as cloves to the cigarettes, which can be consumed by people who are sick. Green tea leaves are being mixed in order to make herbal cigarettes by manufacturers for the reduction of diseases caused by the consumption of tobacco.

Asia Pacific region is analyzed to hold a major regional share for the global tobacco packaging market. Rising population, suburban migration along with growing middle-class income has led to an upsurge in the demand for cigarettes over the forecast period. Growing disposable income has led to the young to spend on luxuries such as cigarettes, good food, parties, alcohol, and other non-essential items owing to which there is a boost in the consumption of cigarettes driving the packaging industry in the coming years. Over the phase-in period for plain packs, smokers of plain packs in Victoria, Australia: ? perceived their cigarettes to be of lower quality and less appealing than smokers of fully branded packs; and ? reported being more likely to think about and prioritize quitting than smokers of branded packs. Among a large sample of Australian adult smokers: ? plain packaging with larger graphic health warnings increased short-term rates of quit intentions, pack avoidance, smokers’ stopping themselves from smoking, and quit attempts during the phase-in period, as well as increased levels of pack avoidance, stubbing out prematurely, and quit attempts in the first year of implementation.8 ? reduced appeal, increased effectiveness of graphic health warnings, and greater perceived harm in response to plain packs also predicted subsequent changes one month later in each of these quitting-related thoughts and behaviors.

Article 11.1(a) of the FCTC specifies that Parties shall implement measures to ensure that tobacco packaging and labelling does not promote a tobacco product by any means which are false, misleading, deceptive or likely to create an erroneous impression about the product’s characteristics, health effects, hazards or emissions, including any term, descriptor, trademark or figurative or other sign that directly or indirectly creates the false impression that a particular tobacco product is less harmful than others.

Major players operating across the tobacco packaging market comprise of Amcor Ltd., Innovia Films, ITC, WestRock, Mondi Group, British American Tobacco, Sonoco, Novelis, Philip Morris International Inc., and Reynolds American Corporation. The extent to which tobacco companies compete on price is also a question of choice. In Australia, a handful of cheap tobacco products has entered the market. However, retail prices have increased above and beyond tax increases and homogenization of the market has not been a significant issue.