HIGHER WORLD TOBACCO USE EXPECTED BY 2010 -- GROWTH RATE SLOWING DOWN

HIGHER WORLD TOBACCO USE EXPECTED BY 2010 -- GROWTH RATE SLOWING DOWN

Number of Smokers Growing –- Production Shifting to Developing Countries

(Reissued as received.)

ROME, 8 January (FAO) -- World tobacco demand is expected to increase until the year 2010 due to population and income growth, but at lower rates than in the past, according to a new study published by the Food and Agriculture Organization (FAO) today.

While in developed countries tobacco smoking is set to continue to decline, in developing countries consumption will increase, the report said (Projections of tobacco production, consumption and trade to the year 2010).

World tobacco production is projected to reach over 7.1 million tonnes of tobacco leaf in the year 2010, up from 5.9 million tonnes in 1997/1999.  This is lower than the record tobacco production of 1992 of 7.5 million tonnes.

The number of smokers is expected to grow from 1.1 billion in 1998 to around 1.3 billion in 2010, according to the report.  This is an increase of about 1.5 per cent annually.

Despite the overall increase of tobacco use, the FAO expects consumption per adult to decline by around 10 per cent by 2010, and individual consumption will probably be around 1.4 kilograms per year (from around 1.6 kilograms in 2000).

Applying an aggressive anti-smoking and anti-tobacco policy, tobacco consumption per person could even drop by 20 per cent, the FAO said.  Consumption per person is declining in developed, and modestly declining in developing countries, including China.

Cigarette smoking is the most prevalent type of tobacco consumption; manufactured and hand rolled cigarettes account for about 85 per cent of all tobacco consumed worldwide.  With around 320 million smokers, China is the world's major cigarette consumer.

About 100 countries produce tobacco.  The major producers are China, India, Brazil, United States, Turkey, Zimbabwe and Malawi, which together produce over 80 per cent of the world's tobacco.  China alone accounts for over 35 per cent of world production.

Tobacco Consumption

By 2010, the share of developed countries in world tobacco consumption is projected to be only 29 per cent (1998:  34 per cent) and the share of developing countries will be 71 per cent.

The overall pattern of tobacco consumption is influenced by two divergent trends.

Tobacco demand in developed countries is declining slowly and will reach about 2.05 million tonnes in 2010.  This is 10 per cent lower than the 2.23 million tonnes consumed in 1998.  This can be attributed to a slower population and income growth.

In addition, in developed countries an increasing awareness of the damaging health effects of smoking, together with the anti-smoking measures of governments including intensified anti-smoking campaigns, the banning of advertising and increased taxation, have had a strong negative effect on consumption of tobacco products, the report said.

But more tobacco will be smoked in developing countries, where tobacco consumption is expected to grow to 5.09 million tonnes by 2010 (from 4.2 million 1997/1999).  This is an average annual growth rate of 1.7 per cent between 1998 and 2010, significantly lower than the 2.8 per cent rate observed in developing countries between 1971 and 1998.

A major part of the projected increase in demand is expected to be in the Far East, particularly in China.  The share of China in total world tobacco demand is likely to remain around 37 per cent in 2010.

In India, the second most important tobacco consumer, smoking of conventional cigarettes accounts for only 25 per cent.  Most people consume tobacco in the form of non-cigarette items such as hand-rolled bidis, chewing etc.  Total demand for tobacco in India is likely to continue to increase, but more slowly than in the previous decades.

In Latin America, tobacco use in 1998 was about 0.48 million tonnes, of which just over half was in Brazil.  Demand in the region is expected to increase modestly until 2010, and most of the increase will occur in Brazil.

In Africa, total tobacco demand increased in the 1990s with record growth of 3.5 per cent per year.  Growth for the period to 2010 is expected to continue at a similar rate.

In the Near East, the demand for tobacco is expected to grow at 0.42 per cent, a growth rate a little lower than experienced in the 1990s (0.44 per cent).

Tobacco production -- a shift to developing countries

The developing countries are expected to further increase their share in world tobacco production, according to the report.

“Production policies supporting tobacco in developed countries are under constant pressure and tobacco profitability at farm level is expected to decline further”, the report said.

Supply is expected to increase in countries where production costs are low, there are no production restrictions, and good transportation systems and access to international markets are available.

“With that in mind, we might expect to see some further shift of cigarette manufacturing, also, towards developing countries”, the report said.  Cigarette production in developing countries is already surpassing the production level of developed countries.

Reducing demand

It is the higher demand for tobacco in the developing countries that drives the world tobacco economy, the report said.  Public policy to reduce tobacco use should focus on demand rather than supply, it suggested.

“Reducing demand in the developing countries would be rather difficult given projected population and income growth trends.  Mitigating these trends, however, and reducing consumption per adult using a combination of tax and direct restriction policies, would also be an important achievement.  Reducing demand will in turn imply a decline in global tobacco production.”

The tobacco study was supported by the Government of Sweden.

For more information, contact:  Erwin Northoff, Information Officer, FAO, e-mail:  erwin.northoff@fao.org, tel.:  (+39) 06 570 53105; FAO Newsroom:  http://www.fao.org/english/newsroom/

* *** *