Tobacco in 2024: The big picture
In 2024, the overall South African tobacco market recorded a continued decline in retail volume sales, although value sales rose, driven by price increases and consumer shifts to higher-margin, non-combustible nicotine products, found in smokeless tobacco and e-vapour products. As a result, cigarette volumes continued to fall as smoking prevalence declined, most notably amongst younger demographics. Moreover, the illicit market, which accounted for approximately 60% of the total cigarette market, continued to hinder legal sales due to its competitive pricing as illicit products avoid taxation. This was also compounded by the overall challenging economic environment, as tobacco suffered from above average inflation and consumers’ limited disposable income.
2024 key trends
Tobacco volumes declined in South Africa in 2024 as the market continued to evolve. The primary development was the shift from traditional cigarettes to new categories such as e-vapour devices and nicotine pouches. In addition, the prevalence of smoking cigarettes continued to decline, as younger demographics chose to forego cigarettes at an increased rate for the aforementioned new categories. Meanwhile, the illicit market continued to limit the formal markets’ capacity to reach its full potential, as consumers have been slow to move back to legal cigarette offerings since the COVID-19 crisis.
Competitive landscape
British American Tobacco (South Africa) Ltd was the leading company within tobacco overall in 2024.
Retail developments
Supermarkets remained the leading distribution channel for cigarettes and smokeless tobacco in 2024, in large part due to wider product availability and convenience, when compared to other distribution channels. However, the supermarkets channel is expected to see a lower share of the overall market during the forecast period, as consumers shift to other distribution channels, including forecourt retailers and food/drink/tobacco specialists.
What next for tobacco?
During the forecast period, South Africa’s tobacco market is expected to see volume sales stagnate as it experiences innovation in alternative products and shifting consumer preferences. While traditional cigarettes and smoking tobacco are likely to decline due to health concerns, rising prices, and tightening regulatory controls, e-vapour products and heated tobacco are expected to see sustained growth. E-vapour products are set to see growth supported by increased urbanisation, the popularity of disposable and reusable systems, and a wide range of flavour offerings. These included products such as Vuse Go Reload and Airpops, which is gaining traction amongst younger, price-sensitive consumers of legal smoking age who value convenience and perceive these products as lower-risk alternatives. Heated tobacco is benefiting from continued investment in devices such as IQOS ILUMA. However, the target audience for these products is relatively small, based on the high price-point of these devices. Regulatory uncertainty around advertising, flavours, and taxation presents risks, but also encourages compliant innovation.
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Overview:
Understand the latest market trends and future growth opportunities for the Tobacco industry in South Africa 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 South Africa, 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 South Africa 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 South Africa?
- Which are the leading brands in Tobacco in South Africa?
- How are products distributed in Tobacco in South Africa?
- Which category is the most heavily taxed in South Africa?
- How is the operating environment for Tobacco changing?
- What are the current legislative restrictions applicable to the sale of Tobacco products in South Africa?
- 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 South Africa
Tobacco in 2024: The big picture
2024 key trends
Competitive landscape
Retail developments
What next for tobacco?
Legislation
Legislative overview
Minimum legal smoking age
Smoking prevalence
Tar levels
Health warnings
Plain packaging
Advertising and sponsorship
Point-of-sale display bans
Smoking in public places
Low ignition propensity (LIP) cigarette regulation
Flavoured tobacco product ban
Reduced harm
Vapour products
PRODUCTION/IMPORTS/EXPORTS
DISCLAIMER
Cigarettes in South Africa
KEY DATA FINDINGS
Increasing competition from illicit market and alternative products
JT International sees growth, but British American Tobacco remains dominant
Supermarkets dominates sales, but only food/drink/tobacco specialists sees growth
Changing norms and lack of innovation
Stricter regulations to limit potential for growth
Lack of innovation expected to continue
Taxation rates
Average cigarette pack price breakdown
Cigars, Cigarillos and Smoking Tobacco in South Africa
KEY DATA FINDINGS
Economic factors impede category development
Leading players reinforce dominant positions in cigars and cigarillos, and smoking tobacco
Food/drink/tobacco specialists dominates distribution
Contrastign performances expected for cigars and cigarillos, and smoking tobacco
Bleak outlook for pipe tobacco
African cigars highlight potential for innovation
Smokeless Tobacco, E-Vapour Products and Heated Tobacco in South Africa
KEY DATA FINDINGS
Rise of e-vapour products and heated tobacco contributes to smokeless tobacco decline
Leaders see share decline
Supermarkets the clear leader in smokeless tobacco, while food/drink/tobacco specialists dominates heated tobacco
Growth anticipated across categories
Regulatory changes could impact category development
Innovative categories
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.
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This report originates from Passport, our Tobacco research and analysis database.
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