The global cigarette market is estimated to be worth USD 30.7 billion in 2021 and is projected to grow at a compound annual growth rate (CAGR) of 4.1% from 2022 to 2030.
The growing preference for hand-rolled or handmade tobacco products due to their relatively low cost compared to factory-manufactured (FM) cigarettes is driving demand for roll-your-own (RYO) tobacco products worldwide.
Handmade cigarettes are generally less regulated and taxed less. As a result, these products are becoming increasingly popular among economically stressed younger consumers and lower-income groups.
However, some studies suggest that his RYO cigarettes in developed countries We know that the consumption of the product is increasing year by year.
The financial crisis caused by the COVID-19 pandemic has increased price sensitivity among lower and middle-income consumer groups.
As a result, price-sensitive consumers are switching from their previous options to lower-cost options. Furthermore, according to his 2018 study published by University College London (UCL), RYO smokers are less likely to quit than factory cigarette users.
A major reason for the RYO smoker’s reluctance to quit is the relatively low cost of his RYO products compared to FM cigarettes. Therefore, the self-rolling cigarette market is expected to experience healthy growth in the coming years.
Increased consumption of tobacco products among women and students is also boosting growth. Leading companies have launched new products to meet the changing demands of millennial and Gen Z consumers.
For example, Japan Tobacco Inc. introduced “Heat-not-Burn” (HNB) in Japan in February 2018. The company also plans to spend more than ¥100 billion over the next three years on research and development of reduced-risk products (RRPs) and cigarette alternatives that do not use flammable ingredients to produce nicotine.
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Products Insights
Filters and paper laces are expected to register the fastest growth during the forecast period. Filter tips are great for customers who like to roll their cigarettes and want a filtered smoke option.
They consist of cellulose acetate fibers, paper or activated carbon, phenol formaldehyde resin, and asbestos. Cellulose acetate is made by esterifying bleached cotton or wood pulp with acetic acid.
Smokers are increasingly using filters to reduce their consumption of tar and other harmful ingredients.
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Distribution Channel Insights
The offline distribution channel dominated the market for roll-your-own tobacco products and accounted for a revenue share of more than 85.0% in 2021.
The segment includes convenience stores, supermarkets, liquor stores, newsstands, and pharmacies. The sale of roll-your-own tobacco is primarily done through smoke shops or retail shops under strict guidelines.
These products are also sold online, but it is heavily regulated and hence, the volume of transactions online is low compared to offline distribution channels.
