Roll-Your-Own Tobacco Product Market Size, Share & Trends Report

Roll-Your-Own Tobacco Product Market Size, Share & Trends Analysis Report By Products (RYO Tobacco, Filter & Paper Tip), By Distribution Channel (Offline, Online), And Segment Forecasts, 2021 - 2028

  • Published Date: Feb, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-4-68038-593-9
  • Format: Electronic (PDF)
  • Historical Data: 2016 - 2019
  • Number of Pages: 80

Report Overview

The global roll-your-own tobacco product market size was valued at USD 7.49 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 4.2% from 2021 to 2028. The growing preference for hand‐rolled or handmade cigarettes as they are relatively less expensive compared to factory-made (FM) cigarettes has been driving the demand for roll-your-own (RYO) tobacco products across the world. Handmade cigarettes are generally subject to fewer regulations and less taxation. As a result, these products are gaining popularity among financially stressed young consumers and lower annual income groups. However, some studies have found that RYO tobacco products' consumption has been increasing in developed countries over the years. Furthermore, many handmade cigarette smokers believe that RYO tobacco products are less harmful than FM cigarettes. This trend has also boosted the growth of the market.

U.S. RYO tobacco products market size, by distribution channel, 2016 - 2028 (USD Million)

The producers have been offering a wide range of flavors to appeal to young and new consumers. Therefore, flavored tobacco products are generally considered ‘starter’ products. Mint, bubblegum, watermelon, vanilla, and spice are the popular flavors of the industry. Menthol is the most popular flavor in the smoking tobacco industry. As per the U.S. Food and Drug Administration (FDA), as of 2020, over 19.5 million people in the U.S. smoke menthol cigarettes. However, the increasing restrictions and prohibition on the sale of flavored products in various countries, including the U.S., Canada, Brazil, Turkey, and several European countries, have been hampering the product's adoption rate in the market.

The financial crisis caused by the COVID-19 pandemic has increased price sensitivity among the low- and middle-income consumer groups. As a result, the price-conscious consumers are shifting toward lower-cost alternatives from their previous choice of tobacco. This shift in demand is resulting in rising demand for roll-your-own tobacco products. Furthermore, according to a study published by University College London (UCL) in 2018, RYO smokers are less likely to quit smoking than factory-made cigarette consumers. The key reason for RYO smokers’ unwillingness to quit is the comparatively lower cost of RYO products as compared to FM cigarettes. Thus, the market is expected to witness healthy growth in the upcoming years.

Distribution Channel Insights

The offline distribution channel accounted for a share of more than 85.0% in 2020. The segment includes convenience stores, liquor stores, supermarkets, pharmacies, and newsstands. Tobacco companies make extensive use of the retail environment to reach their customers by advertising and promoting their products. Additionally, most fine-cut tobacco retailers are disproportionately located in heavily populated areas with a significant number of minority and low-income population groups, which make up for a large part of the consumer base for fine-cut loose tobacco.

The online distribution channel is expected to register the fastest CAGR of 5.8% from 2021 to 2028. The use of online shopping portals is popular among the young population group, who are the industry's key consumers. In addition to classic mail-order sales and the many online tobacco products, the increasing prevalence of app-based sellers and delivery services that are significantly popular with young consumers is driving the segment.

Products Insights

RYO tobacco accounted for the largest share of more than 40.0% in 2020. The growing popularity of roll-your-own-tobacco is attributed to the belief that rolling cigarettes is a way to reduce smoking or avoid the toxic chemicals present in commercially manufactured filtered cigarettes. Several smokers also assume that roll-your-own-tobacco products are less harmful because they are more natural. These are generally packaged in pouches. Rolling tobacco pouches and cigarette papers are much less expensive than buying factory-made cigarettes, which has also been contributing to the adoption of roll-your-own-tobacco.

Global RYO tobacco products market share, by product, 2020 (%)

The filter and paper tip segment is projected to register the fastest CAGR of 4.7% from 2021 to 2028. Smokers are increasingly using the filter to decrease the consumption level of tar and other harmful components. Furthermore, manufacturers have been launching environmentally friendly and innovative filter and paper tips in various flavors to increase consumer base and get a competitive benefit over others. For instance, in December 2017, Karma Filter Tips launched its environment-friendly filter tip. These 100% biodegradable products include plant seeds, which breed plants after the disposal of the tip. It also improves the smoking experience.

Regional Insights

Europe held the largest share of over 55.0% in 2020. The region has a high smoking rate, which has been driving the demand for the product. According to the WHO, the average smoking rate in Europe was 28.7% in 2018. The factory-made cigarette industry in the U.K. has been witnessing a decline in premium brands' sales and a consistent growth in ROY cigarettes and other roll-your-own tobacco products.

North America is expected to expand at the fastest CAGR of 4.7% from 2021 to 2028. In North America, especially in the U.S., while the demand for cigarettes has been decreasing, the trend for roll-your-own tobacco cigarettes has been gaining popularity among students, young adults, and the female population. The consumption of tobacco products and hand-rolled cigarettes is actively rising among females in the U.S. This factor is boosting the demand for tobacco and related products in the region.

Key Companies & Market Share Insights

The RYO tobacco products market is characterized by the presence of various well-established players and several small and medium players. However, the industry is dominated by the top international players, such as Imperial Brands; British American Tobacco; and Japan Tobacco Inc.

Product launches are expected to fuel the market growth. For instance, in November 2019, Imperial Tobacco designed a combi-pouch for its economy roll-your-own-tobacco brand Riverstone. The new product comprises 30g of easy-to-roll tobacco, 60 filters, and 60 papers and is available in GBP 11. The launch is designed to attract new consumers to the industry. Such initiatives are expected to boost the adoption rate of the product among consumers. Some prominent players in the global roll-your-own tobacco product market include:

  • Imperial Brands

  • British American Tobacco

  • Japan Tobacco International

  • Scandinavian Tobacco Group A/S

  • Altria Group, Inc.

  • Philip Morris International

  • HBI International

  • Curved Papers, Inc.

  • Karma Filter Tips

  • Shine Brands

Roll-Your-Own Tobacco Product Market Report Scope

Report Attribute

Details

Market size value in 2021

USD 7.82 billion

Revenue forecast in 2028

USD 10.42 billion

Growth Rate

CAGR of 4.2% from 2021 to 2028

Base year for estimation

2020

Historical data

2016 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD million/billion and CAGR from 2021 to 2028

Report coverage

Revenue forecast, company ranking, competitive landscape, growth factors, and trends

Segments covered

Products, distribution channel, region

Regional scope

North America; Europe; Asia Pacific; Central & South America; Middle East & Africa

Country scope

U.S.; Germany; U.K.; France; China; Australia; Brazil

Key companies profiled

Imperial Brands; British American Tobacco; Japan Tobacco International; Scandinavian Tobacco Group A/S; Altria Group, Inc.; Philip Morris International; HBI International; Curved Papers, Inc.; Karma Filter Tips; Shine Brands

Customization scope

Free report customization (equivalent to up to 8 analysts working days) with purchase. Addition or alteration to country, regional & segment scope.

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Segments Covered in the Report

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2016 to 2028. For the purpose of this study, Grand View Research has segmented the global roll-your-own tobacco product market report on the basis of product, distribution channel, and region:

  • Products Outlook (Revenue, USD Million, 2016 - 2028)

    • RYO Tobacco

    • Rolling Paper & Cigarette Tubes

    • Injector

    • Filter & Paper Tip

  • Distribution Channel Outlook (Revenue, USD Million, 2016 - 2028)

    • Offline

    • Online

  • Regional Outlook (Revenue, USD Million, 2016 - 2028)

    • North America

      • U.S.

    • Europe

      • Germany

      • U.K.

      • France

    • Asia Pacific

      • China

      • Australia

    • Central & South America

      • Brazil

    • Middle East & Africa

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