Tobacco in Kenya

Tobacco in 2024: The big picture

In 2024, Kenya’s tobacco landscape continued its slow but unmistakable evolution, shaped by the convergence of economic pressures, shifting consumer values, and a diversifying product landscape. Traditional smoking continued to face headwinds due to rising excise taxes, tighter advertising and public usage restrictions, and a growing awareness of tobacco-related health risks. At the same time, consumers – particularly younger adults – began exploring emerging alternatives such as e-vapour products, heated tobacco, and smokeless nicotine options. While cigarettes still accounted for the largest share of overall sales, newer formats gained ground, driven by the appeal of innovation, perceived reduced harm, and social media influence. The market was also impacted by broader macroeconomic trends, including inflationary pressure and purchasing power constraints, prompting shifts in affordability and product accessibility. As such, 2024 marked a pivotal year in which regulatory, economic and behavioural dynamics collectively redefined the pace and direction of growth across Kenya’s tobacco sector.

2024 key trends

In 2024, retail value sales of tobacco fell slightly, reflecting a broader decline in consumption and continued pressure on traditional tobacco formats. This softening of the market was influenced by a combination of declining tobacco production acreage and an increasingly stringent regulatory and fiscal environment. Successive rounds of excise tax hikes made tobacco products less affordable, while bans on public smoking and advertising limited their visibility and appeal. In parallel, anti-smoking campaigns intensified, raising public awareness of the health risks associated with tobacco use and driving down demand, especially among more health-conscious urban consumers.

Competitive landscape

British American Tobacco Kenya Limited remained the leading company within tobacco overall in 2024. The company produces several prominent cigarette brands, including Sportsman, Rooster, Dunhill and Embassy, and saw a slight decrease in its volume share over the year. BAT Kenya's continued leadership can be largely attributed to its longstanding brand recognition, consistent product quality, and a strong nationwide distribution network. In addition, the company benefits from its status as one of the most established employers in the country, with extensive supply partnerships across Kenya’s tobacco farming regions. Despite facing pressure from growing regulation and shifting consumer preferences, BAT Kenya maintained a dominant position through its investment in local sourcing, pricing strategies, and a comprehensive retail footprint.

Retail developments

Grocery retailers remained the leading distribution channel for tobacco products in Kenya in 2024, accounting for the vast majority of volume sales. This dominance reflects the widespread presence of supermarkets and convenience-oriented outlets in both urban and peri-urban areas, where consumers can access tobacco products alongside everyday essentials. The continued growth of kiosk-style retail formats also contributed to the performance of the grocery retail channel, particularly in expanding access across counties. These smaller outlets have become increasingly popular for their accessibility, especially in areas underserved by larger supermarket chains.

What next for tobacco?

Value and volume sales of tobacco in Kenya are expected to rise modestly over the forecast period. This growth will be shaped by a combination of persistent demand, regulatory navigation, and the expanding presence of informal market channels. Despite ongoing public health campaigns and taxation policies aimed at curbing tobacco use, industry players are expected to continue lobbying efforts to protect their interests. The rise in illicit trade also presents a key concern, potentially fuelling consumption by making unregulated and more affordable products widely available. Meanwhile, tobacco farming remains a source of income and employment for many households, helping to sustain the domestic supply chain and enabling continued production despite pricing and regulatory pressures.