Tobacco in 2024: The big picture
After robust GDP growth in 2023, for 2024, economic growth decelerated, reaching 2.9%. This was highly influenced by the suspension of activities at the First Quantum copper mining company and recurring droughts that affected transit through the Panama Canal. Activities, such as tourism, transportation, construction, real estate, and financial services performed positively, contributing to the dynamism in internal consumption, including that of tobacco.
2024 key trends
During 2024, both volume and value sales of tobacco decreased, largely influenced by the steep decline in sales of cigarettes, that account for the majority of industry sales. The country has tight tobacco regulations and high taxes, which heavily impact prices, making them unaffordable to many Panamanians. These policies have exacerbated the illegal market which comprises 91% of the consumed cigarettes in the country.
Competitive landscape
Philip Morris remains the largest player in tobacco products, supported by its Marlboro and Chesterfield brands. In 2024, the company gained industry share by focusing on its mid-priced brand and reducing prices, in order to counteract the effects of illicit trade.
Retail developments
During the review period, the distribution channels for tobacco products, including cigarettes, cigars, and e-vapour products, have remained largely unchanged. In 2024, small local grocers and supermarkets remain the largest channels in sales of cigarettes, while retail e-commerce experienced a decline due to legal restrictions on displaying cigarette images and online promotions. Similarly, in Panama, the distribution landscape for cigars, cigarillos, and smoking tobacco remains stable, with food/drink/tobacco specialists serving as the primary channel. E-vapour products are mainly sold through tobacco specialists and retail e-commerce platforms.
What next for tobacco?
Over the forecast period, retail volume sales of tobacco are expected to decline, primarily due to the government’s ongoing anti-smoking initiatives which have significantly reduced smoking prevalence. Additionally, the recent lifting of the ban on e-vapour products is likely to further diminish demand, as many Panamanians are shifting to these reduced-risk alternatives. Furthermore, the high taxes imposed on cigarettes will continue to restrict sales in the legal market, while levels of contraband are anticipated to remain high.
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Overview:
Understand the latest market trends and future growth opportunities for the Tobacco industry in Panama with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
Data and analysis in this report provides further detailed coverage dedicated to the following key categories, where applicable:
- Cigarettes
- Cigars, Cigarillos and Smoking Tobacco
- Smokeless Tobacco, E-Vapour Products and Heated Tobacco
If you're in the Tobacco industry in Panama, our research will help you to make informed, intelligent decisions; to recognise and profit from opportunity, or to offer resilience amidst market uncertainty.
The Tobacco in Panama report includes:
- Analysis of key supply-side and demand trends
- Detailed segmentation of international and local products
- Historic volume and value sizes, company and brand market shares
- Five year forecasts of market trends and market growth
- Robust and transparent research methodology, conducted in-country
This report answers:
- What is the market size of Tobacco in Panama?
- Which are the leading brands in Tobacco in Panama?
- How are products distributed in Tobacco in Panama?
- Which category is the most heavily taxed in Panama?
- How is the operating environment for Tobacco changing?
- What are the current legislative restrictions applicable to the sale of Tobacco products in Panama?
- How has COVID-19 impacted demand?
- How have national lockdown and enforced home seclusion following COVID-19 impacted sales?
- Where is future growth expected to be most dynamic?
Tobacco in Panama
Tobacco in 2024: The big picture
2024 key trends
Competitive landscape
Retail developments
What next for tobacco?
Legislation
TAXATION AND DUTY LEVIES
DISCLAIMER
Key Data Findings
2024 Developments
Illicit market heavily impacts sales
Chesterfield behind the succes of Philip Morris
Small local grocers and supermakets remain key distribution channels for cigarettes
Prospects and Opportunities
Forecast period demand for cigarettes continues to decline
Illicit trade continues threatening the industry
Innovation remains limited
Category Data
Key Data Findings
Developments
Tourism inflows continue benefiting demand
Corporación Habanos retains its leadership
Food/drink/tobacco specialists dominate distribution of cigars, cigarillos and smoking tobacco
Prospects and Opportunities
Cigars, cigarillos and smoking tobacco registers steady forecast period growth
New flavours attract newcomers
Consumers increasingly prioritise affordability during the forecast period
Category Data
Key Data Findings
2024 Developments
Law that banned reduced risk products declared unconstitutional
The consumer base for e-vapour products is not consolidated
Specialist stores and retail e-commerce are the key channels
Prospects and Opportunities
Rapid forecast period sales growth of e-vapour products
E-vapour products are not yet regulated
E-vapour products follows global trends
Category Data
The following categories and subcategories are included:
Tobacco
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- Fine Cut Cigarettes
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- Cigarettes (Illicit+Legal)
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- Cigars
- Cigarillos
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- Pipe Tobacco
- Fine Cut Tobacco
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- Chewing Tobacco
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- Loose US-Style Moist Snuff
- Portion US-Style Moist Snuff
- Swedish-Style Snus
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- Closed System Single Use
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- Closed System Rechargeable (including starter kits)
- Closed System Cartridges
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- Open Vaping Systems Charging and Vapourising Devices
- E-liquids
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- Tobacco Heating Devices
- Heated Tobacco
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- Nicotine Pouches
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- Closed System Single Use (Illicit+Legal)
- Closed System Cartridges (Illicit+Legal)
- E-Liquids (Illicit+Legal)
Tobacco
Passport Tobacco covers the seven major tobacco categories: Cigarettes, Cigars & Cigarillos, Smoking tobacco (made up of Pipe tobacco and RYO tobacco), Smokeless Tobacco (snuff and chewing tobacco), E-Vapour Products (closed and open); Heated Tobacco; and Tobacco Free Oral Nicotine. Smoking paraphernalia such as pipes, rolling papers, lighters or matches, etc., are not included, nor are nicotine replacement therapy (NRT) products, which are part of Euromonitor's Passport Consumer Healthcare database.
See all of our definitionsWhy buy this report?
- Gain competitive intelligence about market leaders
- Track key industry trends, opportunities and threats
- Inform your marketing, brand, strategy and market development, sales and supply functions
This report originates from Passport, our Tobacco research and analysis database.
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