U.S. Tobacco Market Is Expected To Expand At A Compound Annual Growth Rate (CAGR) Of 3.4% From 2022 To 2030
U.S. Tobacco Industry Overview
The U.S. tobacco market size was valued at USD 75.9 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 3.4% from 2022 to 2030. As a result of changing consumer preferences, several manufacturers are marketing many novel products like cigars and cigarillos and next-generation products to expand their profit margin. In the U.S., people living below the poverty line and having lower levels of educational attainment have higher rates of cigarette smoking when compared to the rest of the population.
The COVID-19 pandemic has pushed the market to continue to look for ways to reduce supply chain complexity responsibly. The pandemic led to risks and uncertainties related to possible delays in shipments of tobacco products across the nation, including closure or restricted activities at ports or other channels. The pandemic also caused disruptions in the operation of the supply chain and customers due to restrictions in the movement of employees and customers. However, the impact of COVID-19 yielded innovative changes that enabled the business to be more flexible and accelerate certain activities in the crop cycle for the future.
Increased cultivation of tobacco for consumption as well as for exports is expected to contribute to the growth of the regional market. In 2020, Philip Morris International Inc; Japan Tobacco Inc (JT); Imperial Brands Plc; and Altria Group Inc. all raised their sales or profit targets, since the industry performed better than expected, primarily in the U.S. Similarly, in December 2020, Liggett was the fourth-largest manufacturer of cigarettes in the U.S. in terms of unit sales pursuant to the growing demand for cigarettes.
Gather more insights about the market drivers, restrains and growth of the U.S. Tobacco market
It is worth mentioning that while the overall consumption of tobacco seemed to reduce in the past years, the demand for these products gained momentum during the pandemic. The industry volumes outperformed recent historical trends and benefited from increased consumer demand related to changes in underlying cigarette purchasing consumption patterns associated with the pandemic. According to the figures published by the Campaign for Tobacco-Free Kid, in December 2021, currently, 23.6% of high school students are tobacco users, 5.4% are cigar smokers, 11.3% are e-cigarette smokers, and 34.1 million adults are current smokers only in the U.S. These figures are likely to create a significant impact on the market growth.
Along similar lines, in November 2020, the American Lung Association reported that tobacco sales had increased as former smokers who had previously quit smoking may have resumed during the pandemic. It stated that stress could be a primary driver of relapses. Moreover, The WHO predicts the growing use of cigarettes, water pipes, cigars, pipes, smokeless products, and heated tobacco products among adults. This is expected to positively influence the growth of the U.S. tobacco market in the times to come.
Companies have been developing new products to keep up with changing demands of the millennials and generation Z. For instance, in May 2019, Philip Morris launched IQOS. This electronic device heats paper-wrapped tobacco-filled sticks and as a result, generates nicotine-containing aerosol. The product has been launched as an alternative to cigarettes. The advertising of tobacco-based products carries a political influence on kids as they are three times more sensitive to advertising than adults and are more likely to be influenced to smoke by cigarette marketing than by peer pressure. On average, the tobacco industry annually spends USD 8.4 billion i.e. USD 23.0 million each day on the marketing of its products nationwide.
Browse through Grand View Research's Alcohol & Tobacco Industry Research Reports.
- Disposable E-cigarettes Market - The global disposable e-cigarettes market size was valued at USD 5.7 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 11.2% from 2022 to 2030. The growing demand for non-tobacco products owing to rising health concerns among consumers is expected to drive the market during the forecast period.
- Heated Tobacco Products Market - The global heated tobacco products market size to be valued at USD 77.61 billion by 2025 and is expected to grow at a compound annual growth rate (CAGR) of 52.56% during the forecast period. It is driven by the steady decrease in cigarette sales with rising demand for potentially reduced-risks products.
U.S. Tobacco Market Segmentation
Grand View Research has segmented the U.S. tobacco market based on product, distribution channel, and region:
U.S. Tobacco Product Outlook (Revenue, USD Million, 2017 - 2030)
- Smokeless
- Cigarettes
- Cigar & Cigarillos
- Next Generation Products
- Waterpipes
U.S. Tobacco Distribution Channel Outlook (Revenue, USD Million, 2017 - 2030)
- Online
- Offline
U.S. Tobacco Regional Outlook (Revenue, USD Million, 2017 - 2030)
- North America
- Europe
- Asia Pacific
- Latin America
- Middle East & Africa (MEA)
Market Share Insights
- March 2022: British American Tobacco invested in newer nicotine and tobacco products which, unlike cigarettes, carried the potential for growth in developed markets. The company’s products include snus, nicotine pouches, e-cigarettes, and heated tobacco products
- January 2020: Japan Tobacco International (JTI) launched ‘Sterling Dual Capsule Leaf Wrapped’ that is officially being sold as cigarillos.
Key Companies profiled:
Some prominent players operating in the U.S. tobacco market include:
- Pyxus International, Inc.
- Swedish Match AB
- Altria Group, Inc.
- Korea Tobacco & Ginseng Corporation
- Imperial Brands
- Philip Morris International
- Universal Corporation
- Japan Tobacco Inc.
- Scandinavian Tobacco Group
- Vector Group LTD
Order a free sample PDF of the U.S. Tobacco Market Intelligence Study, published by Grand View Research.
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Grand View Research, U.S.-based market research and consulting company, provides syndicated as well as customized research reports and consulting services. Registered in California and headquartered in San Francisco, the company comprises over 425 analysts and consultants, adding more than 1200 market research reports to its vast database each year. These reports offer in-depth analysis on 46 industries across 25 major countries worldwide. With the help of an interactive market intelligence platform, Grand View Research Helps Fortune 500 companies and renowned academic institutes understand the global and regional business environment and gauge the opportunities that lie ahead.
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