Abstract
Why buy this report
- Get insight into trends in market performance
- Pinpoint growth sectors and identify factors driving change
- Identify market and brand leaders and understand the competitive
environment
Product coverage
Cigarettes; Cigars; Smoking tobacco
Executive summary
Tobacco retail sales show healthy growth
Cigarettes accounts for nearly three-quarters of total tobacco value sales in
Belgium. The sector also demonstrated the most dynamic increases over the
review period.
Smoking tobacco, primarily RYO (roll-your-own), is relatively popular in
Belgium, although not to the same extent as in the Netherlands. Cigars
accounts for only a small proportion of the sales mix and is declining in
importance.
Government efforts have little impact on smoking population
The percentage of smokers in Belgium remained largely stable over the review
period, and did not see the steady declines of some other European countries.
Nearly one third of Belgian males and one quarter of females are smokers in
Belgium. However, the proportion of consumers who smoke on a daily basis,
rather than occasionally, is declining.
Additionally, consumers are starting to smoke at an increasingly young age,
with one in 10 smokers having tried their first cigarette by the age of 12.
The government is trying to stamp out smoking and has recently passed
legislation further outlawing smoking in public places, and increasing the
area given over to non-smokers in entertainment establishments.
Prices remain lower than in many European countries
Lower prices in Belgium compared with surrounding countries -- with the
exception of Luxembourg -- are leading to high sales in the retail travel
environment, rather than just to domestic consumers. This was particularly
marked in 2001 and 2002, when countries -- particularly the UK -- started to
clamp down on personal tobacco imports. In addition, recent price increases in
France saw more French consumers crossing the border into Belgium to buy
tobacco in 2004.
Under the Belgian federal plan for the fight against smoking that was adopted
in early 2004, price increases of EUR0.20 per year for a packet of cigarettes
will be imposed during the next five years. Tax increases will also be made on
smoking tobacco products, which have traditionally enjoyed lower rates of
excise tax than cigarettes.
International manufacturers dominate market
Philip Morris is the leading manufacturer in the Belgian market, and its
volume share of cigarettes is increasing. British American Tobacco Belgium SA
is the second largest manufacturer, although its volume share of cigarettes
remained steady in recent years, while that of Philip Morris increased. Other
players include JT International, Altadis, CINTA and Gallaher. Marlboro and
L&M are the most popular brands, especially among young people, followed
closely by local brand Belga -- indeed, Belga was equal second in terms of
volume share of cigarettes in 2003. International premium brands are popular
as they are favoured by young consumers.
Tobacco sales will fall going forward
Sales of tobacco will continue to rise throughout the forecast period,
although this will primarily be in terms of value. Cigarettes will continue to
account for the lion' s share of sales, although declines will be seen in both
constant value and volume terms.
Smoking tobacco will show the worst results during the forecast period,
primarily due to increased excise tax levels, which will bring these products
more in line with cigarettes.
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