CITIC Securities: China's e-cigarette exports continue to improve, and the outlook for the second half of the year for international tobacco leaders is optimistic

CITIC Securities: China's e-cigarette exports continue to improve, and the outlook for the second half of the year for international tobacco leaders is optimistic

On August 9, CITIC Securities made a positive forecast for the global new tobacco market from June to July 2024. The agency mentioned that China's e-cigarette exports maintained positive growth in June 2024, up 5.9% year-on-year, and the global new tobacco market as a whole showed a positive development trend, despite potential risks such as macroeconomic and policy changes.

On August 9, CITIC Securities' WeChat official account announced a positive forecast for the global new tobacco market from June to July 2024.

The agency said that the global new tobacco market situation is relatively positive from June to July 2024:

In June 2024, China's e-cigarette exports continued to improve, up 5.9% year-on-year to US$1.0 billion;

Demand in Japan, the core market of HNB, continued to grow rapidly, but the promotion of IQOS in the United States was postponed to 24Q4, and the increase in consumption tax and the ban on the sale of flavored tobacco products in the European market may have an impact on demand;

In terms of traditional tobacco, China's cigarette production in 24H1 increased steadily, up 1.6% year-on-year to 1.4 trillion sticks;

In June, China's cigarette export value increased significantly by +122% year-on-year, and tobacco leaf imports continued to rise in both quantity and price, and the average export price of tobacco leaves continued to rise.

In addition, risk factors include:

Macroeconomic pressure has led to weak demand for tobacco products;

Major changes in tobacco-related policies and regulations;

VUSE alto menthol flavor failed to pass PMTA;

Subversion of atomization technology paths;

Illegal product supervision is less stringent than expected.