$2.3bn
$X.Xbn
2,198
31
$XXX.Xm
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.
Industry revenue has declined at a CAGR of 5.1 % over the past five years, to reach an estimated $2.3bn in 2023.
Market size is projected to grow over the next five years.
Company | Market Share (%)
2023 | Revenue ($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 |
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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.
Overall cigarette demand has decreased
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.
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NAICS 312220 - Cigarette & Tobacco Manufacturing in Canada
Get an indication of the industry's health through historical, current and forward-looking trends in the performance indicators that make or break businesses.
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...
Learn about an industry's products and services, markets and trends in international trade.
Cigarettes are the industry’s most prolific product. More regulations can throw the industry into disarray.
Discover where business activity is most concentrated in an industry and the factors driving these trends to find opportunities and conduct regional benchmarking.
Manufacturers can generate higher revenue in major cities. Many manufacturers have operations in Ontario and Quebec, Canada’s most populous provinces.
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.
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...
Learn about the performance of the top companies in the industry.
Major companies dominate the industry. The three largest players make up 65.0% of the total market.
Understand the demographic, economic and regulatory factors that shape how businesses in an industry perform.
The industry is heavily regulated. Tobacco products are closely monitored by government bodies and manufacturers also face advertising restrictions.
View average costs for industry operators and compare financial data against an industry's financial benchmarks over time.
The industry grapples with significant legal fees. Manufacturers are subject to heavy ongoing litigation fees and ongoing payments to signatories.
Including values and annual change:
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Key data sources in Canada include:
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:
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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.
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The market size of the Cigarette & Tobacco Manufacturing industry in Canada is $2.3bn in 2024.
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.
The market size of the Cigarette & Tobacco Manufacturing industry in Canada has been declining at a CAGR of 5.1 % between 2018 and 2023.
Over the next five years, the Cigarette & Tobacco Manufacturing industry in Canada is expected to grow.
The biggest companies operating in the Cigarette & Tobacco Manufacturing market in Canada are Rothmans, Benson & Hedges Inc., JTI-Macdonald Corp. and Grand River Enterprises
Tobacco stemming and redrying and Manufacturing cigarettes are part of the Cigarette & Tobacco Manufacturing industry.
The company holding the most market share in Canada is Rothmans, Benson & Hedges Inc..
The level of competition is low and steady in the Cigarette & Tobacco Manufacturing industry in Canada.