Last week, Richard Burrows, the chairman of the second-largest cigarette-producer in the world British American Tobacco presented a forecast conference where he predicted that the global cigarette use would remain stable, roughly at 6 trillion sticks per year, with 30 percent of them would be consumed by smokers from China.

BAT, one of the leading manufacturers that is known around the globe by such popular brands as Lucky Strike, Pall Mall, Viceroy, Dunhill and Kent plans to ensure its stable position in order to meet the requirements of many smokers, no matter if they are opting for low cost products during the recession, or for premium quality cigarettes when the economic situation will get better.

Few years ago, the World Health Organization realized a research on the worldwide tobacco consumption and found out that the rate of smoking population across the world has risen from nearly 1.1 billion in 1998 to approximately 1.3 billion in 2010, a growth of around 1.5 percent each year. However this report can be opposed to British American Tobacco annual report, where was estimated a reduction in the global tobacco market. The BAT report showed that already within a longer period of time the drop in tobacco consumptions consisted 1.5 percent.

According to Paul Adams, British American Tobacco’s Chief Executive Officer, in spite of the fact that the number of people who stop smoking is rising, there always will be people who start lighting up. In addition he added that the number of adults aged 25 and more would grow all around the world.

The sales drop according to the chief executive was recorded in particular markets in 2009 and that is why the BAT considers that the global tobacco volumes as well would be under pressure in 2010. As according to their calculations the international legal cigarette market, except China will fall nearly 3 percent in 2009 as compared to its long-term 1.5 percent dropping.

Thus the pricing strategies remained clear and the global profit was predicted to grow.

The reason of legal sale dropping in the majority of primary markets is hiding in those smokers who turned to black market products. Mr. Adams specified that illegal market of cigarettes items that comprise around 12 percent of global tobacco consumption is the biggest rival for many large tobacco companies.

British American Tobacco registered an aggregate profit of £40.7 billion in 2009. The chief executive officer declared that acquiring local tobacconists would be a very essential part of their growth strategy. Also Paul Adams stated that the latest purchase – Indonesian tobacco company Bentoel – assured BAT with a significant market share in the 4th biggest tobacco market in the world.

In the presented by WHO research it was calculated that in developing countries would be consumed more tobacco products with about 5.10 million tons in 2010 up from nearly 4.2 million a decade ago.

By Kevin Lawson, Staff Writer. Copyright © 2010 TobaccoPub.com. All rights reserved.

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