Cigarette & Tobacco Manufacturing in Canada - Market Research Report (2013-2028)
New York, United States
Last Updated: September 2023
NAICS 31222CARevenue
$2.3bn
Past 5-Year Growth
Profit
$X.Xbn
Employees
2,198
Businesses
31
Wages
$XXX.Xm
Cigarette & Tobacco Manufacturing in Canada industry analysis
Cigarette and tobacco manufacturers in Canada have struggled throughout 2023 due to tough regulatory pressures, taxation and declining cigarette consumption. The government has increased excise taxes several times over the past five years in an effort to curb smoking by forcing industry operators to increase prices to salvage profit. This strategy has been successful in part, since cigarette consumption and the number of smokers in Canada have both declined during the period, to the detriment of the industry. However, as a result of tobacco's inelastic demand, operators have been able to increase prices at a faster rate than demand has fallen; as a result, this has been a key feature for industry profit growth. However, the industry is still anticipated to fall at a CAGR of 5.1% over the past five years and is expected to total $2.3 billion in 2023, when revenue will jump by an estimated 1.4%.The introduction of innovative smoking products has kept the industry afloat because these products are perceived as less harmful than cigarettes, which has caused consumption of those products to grow. These products have also become an attractive alternative to cigarette manufacturing, with major players having launched their first products in early 2018. The decline throughout 2023 can also be attributed to poor trade conditions, which caused exports to decline 15.7% throughout 2023.The industry is expected to rebound slightly throughout 2028. Although prices of cigarettes are expected to continue increasing amid tax hikes and regulatory pressures, the inelastic demand for tobacco products is expected to persist during the outlook period. In addition, a forecast depreciation of the loonie is expected to spur industry exports. As a result, industry revenue is expected to grow at a CAGR of 0.5% over the five years through 2028 to total $2.3 billion.
Trends and Insights
- The COVID-19 pandemic boosted revenue in 2020, carrying a period with mostly lacklustre growth. Many Canadians increased tobacco consumption during the peak of the pandemic to cope with the stressful time.
- Cigarettes are the industry’s most prolific product. More regulations can throw the industry into disarray.
- Manufacturers can generate higher revenue in major cities. Many manufacturers have operations in Ontario and Quebec, Canada’s most populous provinces.
- Consumers display strong brand loyalty, making it difficult to sway existing companies from a particular brand. Manufacturers can easily raise the price of tobacco products without dips in demand.
Industry Overview
Market size and recent performance (2013-2028)
Industry revenue has declined at a CAGR of 5.1 % over the past five years, to reach an estimated $2.3bn in 2023.
Trends and Insights
Consumers turned to cigarettes and other tobacco products during the COVID-19 pandemic
- Consumer demand for cigarette and tobacco products rises during high-stress periods, such as the COVID-19 pandemic and related recession.
- Additional trends and insights available with purchase
Source: IBISWorld
Industry outlook (2024-2029)
Market size is projected to grow over the next five years.
Trends and Insights
Manufacturers endure added competition from e-cigarettes
- Moving forward, an increasing number of smokers will turn to substitute products. Through 2023, electronic cigarette sales have exploded, posing significant competition for cigarette and tobacco manufacturers.
Biggest companies in the Cigarette & Tobacco Manufacturing in Canada
| Company | Market Share (%)
2023 | Revenue ($m)
2023 | Profit ($m)
2023 | Profit Margin (%)
2023 |
|---|---|---|---|---|
Rothmans, Benson & Hedges Inc. | 1,455.0 | 211.1 | 14.5 | |
JTI-Macdonald Corp. | 337.1 | 81.7 | 24.2 | |
Grand River Enterprises | 51.1 | N/A | N/A |
To view the market share and analysis for all 3 top companies in this industry, view purchase options.
Products & Services Segmentation
Source: IBISWorld
Industry revenue is measured across several distinct product and services lines, including Premium cigarette brands, Deep discount cigarette brands and Mainstream cigarette brands. Premium cigarette brands is the largest segment of the Cigarette & Tobacco Manufacturing in Canada.
Trends and Insights
Overall cigarette demand has decreased
- Types of cigarettes can be broken down into premium, discount and mainstream brands.
- More insights available in the full report
Widen you competitive advantage with related industries
Competitors
- Cannabis Production in Canada
Complementors
- Paper Product Manufacturing in Canada
- Other Plastic Product Manufacturing in Canada
- Convenience Stores in Canada
International industries
- Global Cigarette & Tobacco Manufacturing
- Cigarette & Tobacco Manufacturing in the US
- Tobacco Leaf Processing in China
- Cigarette Manufacturing in China
Table of Contents
About this industry
Industry definition
Operators within this industry stem and redry tobacco, and manufacture cigarettes, cigars, smoking and chewing tobacco and reconstituted tobacco. Industry operators acquire raw materials from tobacco growers, and paper and fibre manufacturers. They then process these materials into tobacco products that are sold to wholesalers and retailers.
What's included in this industry?
Tobacco stemming and redryingManufacturing cigarettesManufacturing cigarsManufacturing fine-cut tobaccoManufacturing snuff and snusManufacturing other tobacco productsCompanies
Rothmans, Benson & Hedges Inc.JTI-Macdonald Corp.Grand River EnterprisesPurchase this report to view all 3 major companies in this industry.
Related Terms
SNUSSNUFFCHEWING TOBACCOELECTRONIC CIGARETTE CIGARILLOSFINE-CUT TOBACCOIndustry Code
NAICS 312220 - Cigarette & Tobacco Manufacturing in Canada
Performance
Get an indication of the industry's health through historical, current and forward-looking trends in the performance indicators that make or break businesses.
Analyst insights
The COVID-19 pandemic boosted revenue in 2020, carrying a period with mostly lacklustre growth. Many Canadians increased tobacco consumption during the peak of the pandemic t...
In this chapter (4)
- Current Performance
- Outlook
- Volatility
- Life Cycle
Key metrics
- Annual Revenue, Recent Growth, Forecast, Revenue Volatility
- Number of Employees, Recent Growth, Forecast, Employees per Business, Revenue per Employee
- Number of Businesses, Recent Growth, Forecast, Employees per Business, Revenue per Business
- Total Profit, Profit Margin, Profit per Business
Charts
- Revenue, including historical (2013-2022) and forecast (2023-2028)
- Employees, including historical (2013-2022) and forecast (2023-2028)
- Businesses, including historical (2013-2022) and forecast (2023-2028)
- Profit, including historical (2013-2023)
- Industry Volatility vs. Revenue Growth
- Industry Life Cycle
Detailed analysis
- Trends in supply, demand and current events that are driving current industry performance
- Expected trends, economic factors and ongoing events that drive the industry's outlook
- Key success factors for businesses to overcome volatility
- How contribution to GDP, industry saturation, innovation, consolidation, and technology and systems influence the industry's life cycle phase.
Products and Markets
Learn about an industry's products and services, markets and trends in international trade.
Analyst insight
Cigarettes are the industry’s most prolific product. More regulations can throw the industry into disarray.
In this chapter
- Products & Services
- Major Markets
- International Trade
Key metrics
- Largest market segment and value in 2023
- Product innovation level
- Total imports, level and trend
- Total exports, level and trend
- Trade Balance
Charts
- Products & services segmentation in 2023
- Major market segmentation in 2023
- International trade, including imports by country and exports by country
Detailed analysis
- Trends impacting the recent performance of the industry's various segments
- Innovations in the industry's product or service offering, specialization or delivery method
- Key factors that successful businesses consider in their offerings
- Buying segments and key trends influencing demand for industry products and services
- Recent trends in import and export volumes, country of origin or destination, and expected future trends
Geographic Breakdown
Discover where business activity is most concentrated in an industry and the factors driving these trends to find opportunities and conduct regional benchmarking.
Analyst insights
Manufacturers can generate higher revenue in major cities. Many manufacturers have operations in Ontario and Quebec, Canada’s most populous provinces.
In this chapter (1)
- Business Locations
Charts
- Share of revenue, establishment, wages and employment in each province
- Share of population compared to establishments in each region in 2023
Tables
- Number and share of establishments in each province in 2023
- Number and share of revenue each province accounts for in 2023
- Number and share of wages each province accounts for in 2023
- Number and share of employees in each province in 2023
Detailed analysis
- Geographic spread of the industry across North America, and trends associated with changes in the business landscape
- Key success factors for businesses to use location to their advantage
Competitive Forces
Get data and insights on what's driving competition in an industry and the challenges industry operators and new entrants may face, with analysis built around Porter's Five Forces framework.
Analyst insights
Consumers display strong brand loyalty, making it difficult to sway existing companies from a particular brand. Manufacturers can easily raise the price of tobacco products w...
In this chapter (4)
- Concentration
- Barriers to Entry
- Substitutes
- Buyer & Supplier Analysis
Key metrics
- Industry concentration level
- Industry competition level and trend
- Barriers to entry level and trend
- Substitutes level and trend
- Buyer power level and trend
- Supplier power level and trend
Charts
- Market share concentration among the top 4 suppliers from 2018-2023
- Supply chain including upstream supplying industries and downstream buying industries, flow chart
Detailed analysis
- Factors impacting the industry’s level of concentration, such as business distribution, new entrants, or merger and acquisition activity.
- Key success factors for businesses to manage the competitive environment of the industry.
- Challenges that potential industry entrants face such as legal, start-up costs, differentiation, labor/capital intensity and capital expenses.
- Key success factors for potential entrants to overcome barriers to entry.
- Competitive threats from potential substitutes for the industry’s own products and services.
- Key success factors for how successful businesses can compete with substitutes.
- Advantages that buyers have to keep favorable purchasing conditions.
- Advantages that suppliers have to maintain favorable selling conditions.
- Key success factors for how businesses can navigate buyer and supplier power.
Companies
Learn about the performance of the top companies in the industry.
Analyst insights
Major companies dominate the industry. The three largest players make up 65.0% of the total market.
In this chapter
- Market Share Concentration
- Companies
- Company Spotlights
Charts
- Industry market share by company in 2019 through 2023
- Major companies in the industry, including market share, revenue, profit and profit margin in 2023
- Overview of Rothmans, Benson & Hedges Inc.'s performance by revenue, market share and profit margin from 2017 through 2023
- Overview of JTI-Macdonald Corp.'s performance by revenue, market share and profit margin from 2017 through 2023
- Overview of Grand River Enterprises's performance by revenue, market share and profit margin from 2017 through 2023
Detailed analysis
- Description and key data for Rothmans, Benson & Hedges Inc., and factors influencing its performance in the industry
- Description and key data for JTI-Macdonald Corp., and factors influencing its performance in the industry
- Description and key data for Grand River Enterprises, and factors influencing its performance in the industry
External Environment
Understand the demographic, economic and regulatory factors that shape how businesses in an industry perform.
Analyst insights
The industry is heavily regulated. Tobacco products are closely monitored by government bodies and manufacturers also face advertising restrictions.
In this chapter
- External Drivers
- Regulation & Policy
- Assistance
Key metrics
- Regulation & policy level and trend
- Assistance level and trend
Charts
- Regulation & Policy historical data and forecast (2013-2028)
- Assistance historical data and forecast (2013-2028)
Detailed analysis
- Demographic and macroeconomic factors influencing the industry, including Regulation & Policy and Assistance
- Major types of regulations, regulatory bodies, industry standards or specific regulations impacting requirements for industry operators
- Key governmental and non-governmental groups or policies that may provide some relief for industry operators.
Financial Benchmarks
View average costs for industry operators and compare financial data against an industry's financial benchmarks over time.
Analyst insights
The industry grapples with significant legal fees. Manufacturers are subject to heavy ongoing litigation fees and ongoing payments to signatories.
In this chapter
- Cost Structure
- Financial Ratios
- Key Ratios
Key metrics
- Profit margin, and how it compares to the sector-wide margin
- Average wages, and how it compares to the sector-wide average wage
- Largest cost component as a percentage of revenue
- Industry average ratios for days' receivables, industry coverage and debt-to-net-worth ratio
Charts
- Average industry operating costs as a share of revenue, including purchases, wages, depreciation, utilities, rent, other costs and profit in 2023
- Average sector operating costs as a share of revenue, including purchases, wages, depreciation, utilities, rent, other costs and profit in 2023
- Investment vs. share of economy
Data tables
- Liquidity Ratios (2016-2021)
- Coverage Ratios (2016-2021)
- Leverage Ratios (2016-2021)
- Operating Ratios (2016-2021)
- Assets (2016-2021)
- Liabilities (2016-2021)
- Cash Flow & Debt Service Ratios (2013-2028)
- Revenue per Employee (2013-2028)
- Revenue per Enterprise (2013-2028)
- Employees per Establishment (2013-2028)
- Employees per Enterprise (2013-2028)
- Average Wage (2013-2028)
- Wages/Revenue (2013-2028)
- Establishments per Enterprise (2013-2028)
- IVA/Revenue (2013-2028)
- Imports/Demand (2013-2028)
- Exports/Revenue (2013-2028)
Detailed analysis
- Trends in the cost component for industry operators and their impact on industry costs and profitability
Key Statistics
Industry Data
Data Tables
Including values and annual change:
- Revenue (2013-2028)
- IVA (2013-2028)
- Establishments (2013-2028)
- Enterprises (2013-2028)
- Employment (2013-2028)
- Exports (2013-2028)
- Imports (2013-2028)
- Wages (2013-2028)
Methodology
How are IBISWorld reports created?
IBISWorld has been a leading provider of trusted industry research for over 50 years to the most successful companies worldwide. With offices in Australia, the United States, the United Kingdom, Germany and China, we are proud to have local teams of analysts that conduct research, data analysis and forecasting to produce data-driven industry reports.
Our analysts start with official, verified and publicly available sources of data to build the most accurate picture of each industry. Analysts then leverage their expertise and knowledge of the local markets to synthesize trends into digestible content for IBISWorld readers. Finally, each report is reviewed by one of IBISWorld’s editors, who provide quality assurance to ensure accuracy and readability.
IBISWorld relies on human-verified data and human-written analysis to compile each standard industry report. We do not use generative AI tools to write insights, although members can choose to leverage AI-based tools within the platform to generate additional analysis formats.
What data sources do IBISWorld analysts use?
Each industry report incorporates data and research from government databases, industry-specific sources, industry contacts, and our own proprietary database of statistics and analysis to provide balanced, independent and accurate insights.
Key data sources in Canada include:
- Statistics Canada
- Industry Canada
- Canadian Business Patterns
Analysts also use industry specific sources to complement catch-all sources, although their perspective may focus on a particular organization or representative body, rather than a clear overview of all industry operations. However, when balanced against other perspectives, industry-specific sources provide insights into industry trends.
These sources include:
- Industry and trade associations
- Industry federations or regulators
- Major industry players annual or quarterly filings
Finally, IBISWorld’s global data scientists maintain a proprietary database of macroeconomic and demand drivers, which our analysts use to help inform industry data and trends. They also maintain a database of statistics and analysis on thousands of industries, which has been built over our more than 50-year history and offers comprehensive insights into long-term trends.
How does IBISWorld forecast its data?
IBISWorld’s analysts and data scientists use the sources above to create forecasts for our proprietary datasets and industry statistics. Depending on the dataset, they may use regression analysis, multivariate analysis, time-series analysis or exponential smoothing techniques to project future data for the industry or driver. Additionally, analysts will leverage their local knowledge of industry operating and regulatory conditions to impart their best judgment on the forecast model.
IBISWorld prides itself on being a trusted, independent source of data, with over 50 years of experience building and maintaining rich datasets and forecasting tools. We are proud to be the keystone source of industry information for thousands of companies across the world.
Learn more about our methodology and data sourcing on the Help Center.
Frequently Asked Questions
Unlock comprehensive answers and precise data upon purchase. View purchase options.
What is the market size of the Cigarette & Tobacco Manufacturing industry in Canada in 2024?
The market size of the Cigarette & Tobacco Manufacturing industry in Canada is $2.3bn in 2024.
How many businesses are there in the Cigarette & Tobacco Manufacturing in Canada industry in 2023?
There are 31 businesses in the Cigarette & Tobacco Manufacturing industry in Canada, which has declined at a CAGR of 4.5 % between 2018 and 2023.
Has the Cigarette & Tobacco Manufacturing industry in Canada grown or declined over the past 5 years?
The market size of the Cigarette & Tobacco Manufacturing industry in Canada has been declining at a CAGR of 5.1 % between 2018 and 2023.
What is the forecast growth of the Cigarette & Tobacco Manufacturing industry in Canada over the next 5 years?
Over the next five years, the Cigarette & Tobacco Manufacturing industry in Canada is expected to grow.
What are the biggest companies in the Cigarette & Tobacco Manufacturing market in Canada?
The biggest companies operating in the Cigarette & Tobacco Manufacturing market in Canada are Rothmans, Benson & Hedges Inc., JTI-Macdonald Corp. and Grand River Enterprises
What does the Cigarette & Tobacco Manufacturing in Canada include?
Tobacco stemming and redrying and Manufacturing cigarettes are part of the Cigarette & Tobacco Manufacturing industry.
Which companies have the highest market share in the Cigarette & Tobacco Manufacturing in Canada?
The company holding the most market share in Canada is Rothmans, Benson & Hedges Inc..
How competitive is the Cigarette & Tobacco Manufacturing industry in Canada?
The level of competition is low and steady in the Cigarette & Tobacco Manufacturing industry in Canada.
