The global organic tobacco market size was valued at USD 162.3 million in 2020 and is expected to reach USD 278.4 million expand at a CAGR of 8 % during the forecast period. Rising awareness among occasional as well as heavy smokers regarding the advantages of using organic flavored tobacco to quit smoking is projected to remain a favorable trend in near future. Furthermore, these products find use as they do not contain any harmful substances including ammonia, bleach and pesticides.
Over the past few years, tobacco farmers have been increasing spending on adopting organic farming methods which boost the crop yield as compared to conventional cultivation technologies. Furthermore, the United States Department of Agriculture (USDA) permitted use of the product for smoking as well as non-smoking applications.
The majority of smokers are now shifting towards organic tobacco rolled cigarettes, which is positively impacting the market. Rising health awareness is driving smokers to change their preferences. As the product is less harmful compared to conventional tobacco, the majority of smokers have been shifting their focus towards the consumption of cigars and cigarettes derived from organic tobacco, instead of quitting the smoking habit completely. This factor projected to drive product demand over the projected period.
Flue-cured product forms generated a revenue of more than USD 60 million in 2018. These products. High sugar content along with the limited composition of nicotine in flue-cured forms is expected to promote its usage among smokers over the next eight years. Fire-cured tobacco is expected to witness the fastest CAGR of 9.7% from 2018 to 2025. The excellent flavor is projected to promote the product demand for chewing as well as smoking purposes in the near future.
The market revenue from sun-cured product forms is expected to reach USD 67.4 million by 2025. Consumers of Mediterranean countries including Turkey, Greece, Bulgaria, Macedonia, and Romania prefer these products. Furthermore, low sugar content in the product is projected to promote demand over the next eight years.
The smoking segment is expected to reach USD 196.1 million by 2025. Rising concerns over adverse effects associated with carbon monoxide, heavy metal, and tar which leads to diseases such as Chronic Obstructive Pulmonary Disease (COPD) is projected to limit the scope of organic tobacco for smoking applications.
Demand from the smokeless segment is expected to witness a CAGR of 9.8% from 2018 to 2025. The rising importance of mint chew pouches as alternatives to conventional cigars and cigarettes among adults in developed economies including Germany, France, and U.K. is projected to expand the market size over the projected period.
The organic tobacco market is segmented on the basis of product, application and region. On the basis of product, the market is segmented into Flue-cured, Sun Cured, Fired Cured. On the basis of end-user, the market is segmented into Male, Female.
North America is expected to remain one of the key markets, accounting for more than 30% of global revenue in 2018. Increasing spending on the development of organic products with reduced harmful properties by the tobacco processing companies is anticipated to bode well for the growth. In October 2017, Japan Tobacco Inc. launched a new USDA approved product under the name of Natural American Spirit Organic Leaf, which is additive-free. Shifting preference among buyers to consume organic tobacco products in the form of cigarettes and cigars instead of quitting smoking the conventional ones is projected to remain a key driving force in the near future.
Asia Pacific is expected to witness the fastest CAGR of 8.9% from 2018 to 2025. Countries including China, India, and Japan are experiencing a considerable rise in product demand, owing to factors such as a rise in income levels, consumer awareness, and an attempt to opt for less harmful products. Furthermore, India accounted for more than 80% of global smokeless tobacco consumption in 2018. This factor is projected to expand the scope of organic tobacco as a smokeless and eco-friendly alternative over the next eight years.
Key market participants include Santa Fe Natural Tobacco Company; Japan Tobacco Inc.; Hi Brasil Tobacco; Quinnington Organic Tobacco Company Pty; Cigarette & Co.; Vape Organics; and Mother Earth Tobacco.