Tobacco Manufacturers

Jun 26, 2025 - Improvement for Cigar Manufacturers in Q1

• A recent survey by the Premium Cigar Association showed improvement for manufacturers, with 67% saying they performed better in 2024 compared to 2023, 17% of manufacturers performing the same, and 17% doing worse. The First Quarter 2025 survey also revealed that 51% of retailers said they did better in 2024 compared to 2023, with 29% performing the same and 20% performing worse. Cigar manufacturers were asked to list their top concerns, which included rising costs, competitors over-discounting products, connecting with retailers on a timely and regular basis, finding quality sales help, and tariffs and complexity of different state taxes. Retailers were asked what they would like to communicate with manufacturers to help sell their products, and the most common answers were controlling moderate price increases and shipping, limiting high-end offerings and creating more economy cigars, better education/communication, fixing supply issues, and focusing on core lines and not “what’s new.”
• According to a report in CFO Dive, consumer sentiment, an indicator of discretionary spending, rose in June in large part due to a lull in the tariff war. The final index of consumer sentiment from the University of Michigan grew 15.9% in June 2025 from the previous month, as the Trump administration put some tariffs on hold against major US trade partners. Year over year, the index of consumer sentiment was down 11.3%. An index measuring consumers’ expectations for the future was up 21.9% from the previous month, but was down 16.1% year over year. According to survey director Joanne Hsu, “Consumers appear to have settled somewhat from the shock of the extremely high tariffs announced in April and the policy volatility seen in the weeks that followed.” Hsu noted that consumers’ views of business conditions, personal finances, buying conditions for big ticket items, labor markets and stock markets all remain below six months ago.

• According to AP News, the director of the Center for Tobacco Products (CTP) at the US Food and Drug Administration (FDA) has been placed on leave, and dozens of other CTP staffers were laid off from their posts. The moves come amid sweeping cuts made at Secretary Robert F. Kennedy, Jr.’s Health and Human Services Department. Brian King headed the CTP office and was known for his vigorous response to the vaping market. Among the layoffs were two entire offices responsible for setting policy and drafting new tobacco regulations. According to Tobacco Journal International, the staffing reductions have caused health officials to face challenges in meeting congressional deadlines for reviewing tobacco products. Industry experts say the loss of personnel and expertise could result in the agency spending longer on tobacco applications, possibly causing delays in products coming to market, and potentially spending less time on individual applications, missing safety issues.
• The US Food and Drug Administration proposed a new rule in January 2025 minimizing nicotine levels in cigarettes and other combusted tobacco products, according to Tobacco Reporter. The goal is to make the products minimally or nonaddictive by limiting the nicotine levels to 0.7 milligrams per gram of tobacco. The US would be the first country globally to set such limits. The proposal would apply to cigarettes, cigarette tobacco, roll-your-own tobacco, most cigars, and pipe tobacco. The FDA said the new standard could prevent 48 million US youth and young adults from starting smoking by the year 2100, according to its population health models. The FDA originally announced its intention for the rule in 2018 and is now seeking input on the proposal from the public.