Now PMI (PHILIP MORRIS INTERNATIONAL) is asking Colombian regulators to reconsider their plan to buy Protabaco but it is not at all clear if the government will overturn its decision as PMI already owns what used to be rival Coltabaco – based in Medellin Colombia. Together they control 90%+ of the local Colombian market, which is around 20 billion sticks.

Colombia’s Superintendent of Industry and Commerce rejected PMI’s bid to buy Protabaco for $452 million.

Interestingly, does this open the door for rival BAT to gain entry into the Colombian market? We think it does. Watch this space or provide a comment.

Protabaco manufactures Mustang, Premier and President.

Before you know it this major Industry Trade show will be upon us and in a flash – gone.
The organizers are working hard to make it successful for all visitors.
Exhibitors can have reasonble expectation of not only a good quantity of visitors but a good level as well.
The Show will run concurrenlty with a topical Congress.

At Tobacco Today we are interested to promote a dialogue from all stakeholders aimed at soliciting comments, suggestions and advice from all aspects of the industry – to make the show better and to focus the organizer’s on what the industry is expecting.

We look forward to receiving your comments and creating a lively diaglogue.

A Filtrona executive visited Brazil to break the news to the regional HQ – Souza Cruz – based in Rio de Janeiro.Their reaction is unknown but it cannot be taken lightly as this leaves Bigott to pick up the pieces left by Filtrona’s withdrawal.

The final straw was most likely Rhodia’s recent sudden closure of their Cellulose Acetate plant also located in Valencia. This meant importing tow from elsewhere and having to deal with foreign exchange requirements within Venezuela, not to mention associated increases in raw material and transportation costs. The plant was probably already operating under marginal profitabilty given the difficult economic situation which has developed in Venezuela.

In these difficult economic times our thoughts and best wishes go out to those affected.

ABOUT RUYAN AMERICA
Ruyan America, Inc. is a technology based company that currently develops and markets OTC consumer products using patented and patent-applied-for convenient delivery methods. Ruyan America, Inc. is a U.S.-based joint venture partner of Ruyan Holdings Ltd. of Hong Kong.

ABOUT PRIME TIME INTERNATIONAL COMPANY
Prime Time International Company, established in 1993, is an established manufacturer of tobacco and non-tobacco products with an established presence in the US wholesale and retail supply chain serving over 70,000 established retail outlets. Prime Time International is committed to providing its wholesale and retail trade partners with highly profitable products that they will feel confident representing in their establishments. Prime Time International prides itself on its ability to identify market niches and initiate rapid product development to address changing consumer needs and strives to offer only products of consistent quality and excellence.

For inquires or questions regarding this partnership, Ruyan products, or distribution and sales opportunities call Prime Time International at (800) 959-9880.

The cause: Iceland’s now famous Eyjafjallajokull (sic) volcano’s ash cloud eruption causing almost all European flights to be grounded. This extraordinary activity disrupted travel plans stranding many visitors and would-be exhibitors in Europe – including Colin Case the show’s organizer.

It is hard to believe that a volcano erupting in Iceland can disrupt an exhibition in India.

It is now easy to see how an unforeseen event can have large implications for a (tobacco) exhibition.

If you attended – let us know how it went……

Why is this……?

Mostly it’s because the fundamental burn characteristics of your favorite smokes have been changed by the addition of FSC or LIP paper. It’s not because something bad has been added. FSC or LIP paper has bands printed on it making the paper’s porosity lower. The lower porosity bands (or zones) make the cigarettte burn slower and if it’s not puffed – it can go out.

Making the cigarette burn slower alters the taste in some cases quite significantly.

Your favorite smokes taste worse because most States and all of Canada now require FSC cigarettes.

Until recently we had one major exhibition in Europe every four years, TabExpo; then we had the announcement by WT that an additional event in Europe would be held.  The industry wants less events – or at least lower cost – so we now have the organizations in direct competition for the same business in the same month and year. Two European exhibitions (TR’s TabExpo in Prague & WT in Munich) are set for November 2011 – and just five days apart!

Both have scheduled events in India this year – one an exhibition the other a Networking Forum.

As market leader TR moves ahead with 50 or so confirmed exhibitors already for TabExpo Prague in 2011, it is largely ignoring WT who is left looking desperate in attempting to undermine the viability of Prague in favor of Munich.

Why is this?

The stark reality is the Tobacco Industry is shrinking. Besides China, much of the tobacco industry is mature and driven by consolidation, regulations and taxation – resulting in reduced profitability. A handful of major players (CNTC, PMI, BAT, PM USA, and JTI & Imperial) dominate. The supply side – lagging well behind – has a plethora of players who have not rescaled their business. The result: Piranhas in a goldfish bowl. This reality defines the recent competitiveness between WT and TR as they compete for exhibitors and attendees

But it didn’t have to be this way…….

Seizing what appeared to be an opportunity caused by the debacle which became TabInfo Asia Bangkok last November, WT announced World Tobacco Expo 2011 in Munich. But this announcement came after TR announced TabExpo would be held in Prague.

Why do this?

 It’s tempting to say – who knows – but the appearance of a direct confrontation by WT on TR is hard to ignore. Why else schedule another European exhibition immediately prior to TabExpo Prague, especially and knowingly that TabExpo was always held in November and every four years.

So who wins……………?

Until one organizer assembles an unassailable competitive position – not the tobacco Industry. Exhibitors now have to decide which show to attend and be able to justify it in this cost-conscious environment. It was an unnecessary move and a risky one by WT (that could easily have been avoided.) As it is, if both go ahead then each exhibition dilutes the other, diminishing profitability. If ever there was a time for Industry solidarity it is now.

How did this happen?

Like the Olympics, the Industry and TR agreed to hold TabExpo in Europe once every four years (excepting Barcelona, delayed until 2003.) This has been the case since 1994 and TR has kept to this agreement.

By contrast WT magazine, under the ownership of the Daily Mail Group (DMG) struggled to compete with the three other tobacco magazines; TR, TI and TJI. WT supplemented its profitability to DMG with trade shows which are now “two a year”.  Sadly it was after WT Asia last year that DMG ceased publication of WT Magazine and sold the WT trade show business to Quartz Business Media and announced a merger with TJI (where TJI’s role is to publicize WT’s events.)

So…… Is there space for two events?  Is there the need for annual events?

No.  And certainly not in the space of five days in November 2011.

What was WT thinking………………….?

Astra Tobacco is the sales and marketing company for Delfort group in the US.

Glatz GmbH has also recently launched a LIP paper after considerable speculation they were developing a LIP paper.

SWM apparently intends to defend its LIP intellectual property in the courts if necessary. It will be interesting to see if their patents are robust enough to withstand close scrutiny.

comments welcome………………..

The  sale by Imperial is no great surprise as Sodim clearly did not represent core business activities and was probably slated for sale soon after Imperial acquired Altadis.

In a press release Sodim reiterated its personnel, biz relationships, and location remain unaffected. 

Perhaps of greater interest are the potential repercussions of this acquisition.

Premises are  likely to be consolidated in the longer term – perhaps merging with Hauni’s affiliate Decoulfe.

Sodim has enjoyed a recent virtual monopoly within Imperial and this may change.

Huni on the other hand has previously worked with market leader Cerulean in developing on-line measurement systems to complement machinery.

What’s your view?

This new relationship provides Hauni with an important additional portfolio of products in the areas of metrology and measurement systems.