In this piece, we will take a look at the twelve countries that export the most tobacco in the world. For more countries, head on over to 5 Countries that Export the Most Tobacco in the World.
Tobacco is one of the more controversial plants today, as the prevalence of cigarettes and other forms of smoke-able tobacco have been known to cause different kinds of cancers. Tobacco is not only directly smoked, it is also used in hookahs, sheeshas, and chewing tobacco.
The global tobacco industry is worth billions of dollars. According to a research report from Grand View Market Research, the global tobacco market was worth a stunning $849 billion in 2021. Between 2022 and 2030, the research firm expects the sector to grow at a compounded annual growth rate (CAGR) of 2.4% to be worth more than a trillion dollars by the end of the forecast period. This growth comes despite the rising knowledge of the harms of tobacco consumption and a myriad of different alternative products flooding the market. The research firm rather cynically points out that the coronavirus pandemic ended up helping the industry. While the disease itself is of the respiratory system – which is damaged by smoking – Grand View Market Research believes that the stress of the pandemic caused people to smoke more, and cigarette companies will benefit from this higher usage.
Commenting on the market trends, the research firm outlines that tobacco firms spend a whopping $8.9 billion in advertising in 2019, which amounted to $1 million being spent every hour. It adds that while developed countries are seeing a reduction in smoking, emerging economies such as those Thailand and India are seeing an uptick in smoking, as their youth populations grow. Cigarettes are by far the most commonly consumed tobacco products, as they represented 86% of the overall revenue in 2021.
These days, both large tobacco firms such as Philip Morris International Inc. (NYSE:PM) and other smaller firms are paying attention to smokeless cigarettes – some of which are called electronic cigarettes. While only a recent trend, e-cigarettes have been around since the early 1960s. These alternative tobacco products are of several different kinds. Some of these heat tobacco to generate inhalable nicotine, while others shun nicotine entirely and switch to a nicotine liquid to generate vapor. The global heated tobacco market was worth $4.16 billion in 2021 according to a research report from Research and Markets, and it is expected to grow at a CAGR ranging between 10% and 11% between 2022 and 2027.
Traditional tobacco firms are eager to make a strong entry into the next generation product (NGP) market. Almost all have acquired stakes in or completely bought firms making these products. The earliest mover was Imperial Brands PLC (LON:IMB.L) which created a subsidiary called Fontem Ventures in 2012. Fontem is an e-cigarette manufacturer, and Imperial expanded its presence in the sector by acquiring the blu e-cigarette in 2014 after having already bought another e-cigarette company a year earlier. The crown ‘jewel’ of the e-cigarette industry, Juul Labs, also saw a 35% stake being acquired by the maker of Marlboro Cigarettes in 2019.
In terms of technology, the tobacco industry is also utilizing technology to improve farming practices. For instance, Cropin Technology provides solutions that enable tobacco farmers and the big companies that buy their products to ensure that the supply chain is free from child labor. This is achieved via digitally registering the farmer, profiling them, and tracking the field staff. Additionally, the firm’s technology also allows farmers to digitally monitor their fields for pests, monitor weather, and set timelines for harvesting and packaging the products. The Internet of Things (IoT) gadgets are crucial tools in this avenue and has allowed Chinese tobacco firms to manage warehouses by pre-assigning slots to brands, managing warehouse climate, efficiently picking, packing, and sorting the products, and creating optimal production environments.
Given its size, the tobacco industry is home to some of the largest companies on the planet. Alongside some that are already mentioned, other big players are British American Tobacco p.l.c. (NYSE:BTI), Japan Tobacco Inc. (OTCMKTS:JAPAF), and China Tobacco International (HK) Company Limited (HKG:6055.HK).
Copyright: andresr / 123RF Stock Photo
Our Methodology
We have used trade data from the United Nations and the World Trade Organization to sift out the largest tobacco exporters on Earth. There is one surprising Asian country in our list of the top 5 countries that export the most tobacco. Can you guess which country is the number 1 tobacco exporter in Asia?
12 Countries that Export the Most Tobacco in the World
12. Republic of India
Tobacco Exports in 2021: $911 million
The Republic of India is an Asian country that is the second most populous country in the world. India exported $911 million worth of tobacco in 2021, marking a 2% drop since 2017 but an 8% annual growth. Tobacco is produced in several Indian states, such as Gujrat, Uttar Pradesh, Bengal, Karnataka, and Bihar. Gujrat is the largest tobacco producing state, with a 45% share of the market. India’s largest tobacco companies are ITC Limited (NSE:ITC.NS), Godfrey Phillips India Limited (NSE:GODFRYPHLP.NS), and VST Industries Limited (NSE:VSTIND.NS). Put together, the industry makes India one of the top exporters of tobacco in the world.
11. Netherlands
Tobacco Exports in 2021: $1.1 billion
The Netherlands, also known as Holland, is a prosperous Northwestern country that is one of the most developed nations in the world. Like some other countries on our list, Holland is also dominated by the big tobacco companies – nearly all of which have a presence in the country. Additionally, due to its colonial history, the Netherlands also has its own tobacco company, Koninklijke Theodorus Niemeyer BV, which was a family owned business that first started selling tobacco in the 1800s. Koninklijke Theodorus Niemeyer BV is now a part of British American Tobacco p.l.c. (NYSE:BTI). Tobacco is produced all over the country, in regions such as Wageningen, Gelderland, Nijkerk, and Elst. The Dutch government is quite strict with its tobacco laws and is currently passing legislation to ensure plain packaging for e cigarettes and cigars, and also banning the sale of non tobacco flavored e cigarette liquids.
10. Republic of Indonesia
Tobacco Exports in 2021: $1.14 billion
The Republic of Indonesia is an Asian and Oceanic island country. Commonly called a ‘Tiger Cub’ economy, the country has seen some economic growth over the past few decades. Indonesia is also believed to have the highest smoking rate in the world, which has sometimes been as high as 67% among adults. Naturally, it’s unsurprising that Indonesia has its own type of cigarette called the Kretek. These are unfiltered cigarettes that are made of tobacco, cloves, and other flavors. Some of the largest Indonesian tobacco firms are PT Bentoel Internasional Investama Tbk (IDX:RMBA.JK), PT Hanjaya Mandala Sampoerna Tbk (owned by Phillip Morris), PT Perusahaan Rokok Tjap Gudang Garam Tbk (IDX:GGRM.JK), and PT Djarum – a pureplay kretek manufacturer.
9. United States of America
Tobacco Exports in 2021: $1.17 billion
The United States of America, or the U.S., is the world’s only superpower and the largest economy in nominal terms. Tobacco is produced in several American states, such as North Carolina, Kentucky, and Virginia. Tobacco production in the U.S. has been going on for centuries, with the first plantations having started before the American War of Independence, and at one time, tobacco was also used as a means of barter. Two of the world’s largest tobacco companies, Philip Morris International Inc. (NYSE:PM) and Altria Group, Inc. (NYSE:MO) are American, and others include R. J. Reynolds Tobacco Company (RJR) and Liggett Group. Naturally, the large firms also make America one country with the most tobacco exports in the world.
8. Dominican Republic
Tobacco Exports in 2021: $1.2 billion
The Dominican Republic is a Caribbean country that is the most prosperous in the region. When it comes to the tobacco world, the country is known primarily for its cigars, with rolled tobacco representing close to 10% of the Dominican Republic’s exports. Some varieties of local tobacco are San Vicente, Piloto Cubano, and Olor Dominicano. All of these are used in cigars, and one of the largest Dominican cigar companies is Quesada Cigars which started its business in the 1800s after a family debt was paid in tobacco.
7. Federative Republic of Brazil
Tobacco Exports in 2021: $1.4 billion
The Federative Republic of Brazil, or simply Brazil, is the largest country in Latin and South America, alongside being one of the most developed in the region. It is also the world’s second largest tobacco producer, coming second to China and producing 762,266 tons in 2019. Brazilian tobacco is named after the region that it is grown in, and some popular types are Mata Fina, Arapiraca, and Brazilian-Sumatra. Brazil’s largest tobacco company, Souza Cruz S.A., is a British American Tobacco subsidiary.
6. Romania
Tobacco Exports in 2021: $1.5 billion
Romania is a Central European country with a high GDP per capita of $38,097. Tobacco use is quite common in the country, with an estimated 27% of all adults thought to smoke. The Romanian tobacco industry is dominated by big tobacco companies, and the first company to set up shop in the country was Japan Tobacco Inc. (OTCMKTS:JAPAF). This has also led to a near wipeout of the local industry, which often produced cigarettes and products unique to Romania. One popular Romanian cigarette was the Carpați – which was produced in six factories. To make things interesting, each factory produced its own variant, which then led to a rare occasion where smokers preferred the factory instead of the cigarette. Carpați is now discontinued after holding a majority of the Romanian market share in the late 1900s. The presence of multinationals in Romania also makes it one of the biggest tobacco exporters on the planet.
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Disclosure: None. 12 Countries that Export the Most Tobacco in the World is originally published on Insider Monkey.