Cigarette Production & Consumption

Dec 22nd, 2006, in Business & Economy, by

A slow decline is forecast for cigarette production and consumption.

In Indonesia kretek, or clove, cigarettes dominate the market with about 93% share. wartaekonomi

Kretek Cigarette Production in Indonesia.

  • 1998 – 191 billion cigarettes
  • 1999 – 196
  • 2000 – 207
  • 2001 – 202
  • 2002 – 187
  • 2003 – 180
  • 2004 – 187
  • 2005 – 203
  • July 2006 – 115

Kretek: The Culture and Heritage of Indonesia's Clove Cigarettes
Kretek: The Culture and Heritage of Indonesia’s Clove Cigarettes.

“White”, non-clove leaf cigarettes have about between 7% and 8% market share, and are produced mainly by Philip Morris and British American Tobacco.

White Cigarette Production in Indonesia

  • 1999 – 28.8 billion cigarettes
  • 2000 – 25.8
  • 2001 – 24.7
  • 2002 – 27.7
  • 2003 – 18.1
  • 2004 – 15.6
  • 2005 – 16.9
  • July 2006 – 9.2

In the last six years white cigarette consumption declined on average 7.2% each year, while kretek consumption rose 0.7%. In total number of cigarettes smoked declined 0.3% each year. Cigarette consumption is thought likely to continue this slow decline long term.

Cigarette Consumption

  • 1999 – 225 billion cigarettes
  • 2000 – 232
  • 2001 – 227
  • 2002 – 215
  • 2003 – 198
  • 2004 – 202
  • 2005 – 220
  • 2006 (projected) – 215
  • 2010 (projected) – 213

Between 1999 and 2005 per capita consumption has declined 1.4%.

Per Capita Consumption

  • 1999 – 1,106 cigarettes per person per year
  • 2000 – 1,129
  • 2001 – 1,088
  • 2002 – 1,018
  • 2003 – 928
  • 2004 – 934
  • 2005 – 1,006
  • 2010 (projected) – 930

About seven million people are dependent on the cigarette industry for their livelihoods.

Location of Cigarette Production

  • East Java – 36.9%
  • Central Java – 34%
  • North Sumatra – 29.2%

About 10% of state revenue derives from taxes collected on cigarette production and sales. bkpm

Cigarette Tax Receipts

  • 1999 – 8.6 trillion rupiah
  • 2000 – 12.4
  • 2001 – 17.6
  • 2002 – 22.9
  • 2003 – 25.9
  • 2004 – 28.6
  • 2005 – 32.7
  • May 2006 – 15.6

As of July 2006 Gudang Garam’s sales declined 3.2% on the same period in 2005 while HM Sampoerna has seen a 7% increase, and Djarum a decline of 15.3%

Cigarette Companies’ Market Share

  • Gudang Garam – 31.7%
  • H.M. Sampoerna – 25.9%
  • Djarum – 17.2%
  • Bentoel – 3.1%
  • Other – 22.3%

13 Comments on “Cigarette Production & Consumption”

  1. Bas says:

    Cigarette is financing everything in this country. Cigarette paradise.

  2. The Libertarian says:

    I for one hope that sales do not decline dramatically and that Indonesia continues to get much needed tax revenue out of cigarette sales, the baccy sector employment remains in JATIM, JATENG and SUMUT (provinces where lets face it jobs are needed) and that most Indonesians continue to stick an irreverent finger up at the imported health Nazism in the interests of personal choice/ culture.

    I am not opposed to health education and also bans in confined public places where non smokers have no choice (e.g elevators, communal offices and gyms!) but it should not be extended to bans in social venues (restaurants, karaoke bars etc) where non smokers have a clear choice and the market could establish competing non smoking venues (if there is a demand in Indonesia outside Kemang). I also believe that the smoking ban on Jl Sudirman, Jakarta is a delicious irony given the general air quality!!

    The reasons for these statistics comparing the sales of kretek to white cigs are fairly clear:

    That anti tobacco ‘nazism’ campaigning/education, chic health lifestyle marketing and partial indoor bans (the elevators in my office building seem now to be smoke free!) is having a greater effect on the educated, western exposed middle class who were and are the main consumers of the ‘luxury’ white cigarettes.

    In contrast the mass of the population that enjoys the ‘kretek’ as one of their few pleasures in life has not been receptive to anti tobacco campaigning etc. The ‘kretek’ is indeed a symbol and ritual of rural Indonesia.

    (That said the kretek is also developing a niche appeal in smarter circles but probably not significantly enough to affect these statistics. )

    This all shows what a potentially great strategic move the Philip Morris buy out of Sampoerna was.

  3. 1ndra says:

    I’m not a smoker, come and join me.

    Live in a healthy life and reduce the air pollution, smoking is bad for your health and bad for others.

  4. Fanglong says:

    Very interesting.
    It seems Indonesia resists against the holy war against cigarette.
    I’m impressed by the “kretek ritual”.
    I’m a smoker. I enjoy smoking very much. But, being 54, I’ll soon quit for the sake of my lungs…

    Cheers !

  5. 1ndra says:

    Good luck for you, you’ll get richer if you’re not smoking. 😀

  6. Johny Clark says:

    Cigarettes is the backbone of Indonesia economy. If any of you involved in this business, then you’ll realize how much is this business capitalization. There are so many economic sector related to cigarette industry, even the one you’ve never imagined that it is related.
    So, in my opinion, the war against cigarettes can be contra-productive to the economic growth of our nation. The stop-smoking campaign must be done very carefully and with consideration in all aspect.
    I’m not a smoker, not even a single piece of cigarette up until today. But I’m against if the stop-smoking law is to be applied strictly in the near future.

    Think about our nation, dont just blindly adopt a campaign started in the developed countries which is not really suitable to our present condition.

  7. Marcelo says:

    I would like to know if Gudang Garam use eugenol ?

  8. yousef ali says:

    Dear Sir/Madam
    We come to know about your company by visiting your website. Your products are very good and we hope to deal with your company.
    We are traders in DUBAI and we want to buy from your company cigarettes Marlboro with acommercial amount it Marlboro cigarettes
    We will be so grateful if you tell us about the prices

  9. Akhirman says:

    Cigarette is an odd matter. In one side, cigarette gives much tax for indonesia, but the other side that makes us unhealthy. It is confusing.

  10. Raynard says:

    Where can i get a regular supply of kreteks sent to australia .
    I know dozens of kretek smokers and coud sell heaps ,
    failing that , does anyone know the real recipe to make my own.

  11. BAMBANG TITIS says:

    I’m a heavy smokers of Wismilak original Kretek since 1964
    Let’s join us to smoke and enjoing your life and support the Indonesian backbone economic and original heritage worldwide.

  12. john villa says:

    yes cigarette is great source of economy but it is harmful for human body, that means one aspect of this is really dangerous…………

  13. LT says:

    Hi there,
    Interesting article. Can you please advise where you have got this data from?

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