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Economic Trends in Tobacco						Print
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			Tobacco-Related SpendingTobacco Production in the United StatesTobacco SalesEconomic Cost Estimates Associated With Cigarette SmokingReferences
		

Tobacco-Related Spending**In 2019, the largest tobacco companies spent $8.2 billion marketing cigarettes and smokeless tobacco in the United States. This amount translates to about $22.5 million each day, or nearly $1 million every hour.**1
Cigarette advertising and promotional expenses totaled about $7.62 billion in 2019—a decrease from 2018. However, even though cigarette companies spent less overall on advertising and promotion in 2019 than in 2018, they spent a larger percentage (74.7%, or about $5.7 billion) of their 2019 advertising and promotion dollars on price discounts paid to cigarette retailers than they did the year before. These price discounts reduce the cost of cigarettes to consumers.1
Manufacturers spent a total of $576.1 million on smokeless tobacco advertising and promotion during 2019—a decrease from 2018.2 Smokeless tobacco products include dry snuff, moist snuff, plug/twist, loose-leaf chewing tobacco, snus, and dissolvable products.
A number of electronic products, such as electronic cigarettes (e-cigarettes), electronic cigars (e-cigars), and electronic pipes (e-pipes), are on the market. However, current information on spending for marketing and promotion of these products is currently not available.
From 2014 through 2020, e-cigarette sales in the United States generally increased as product prices decreased. Total e-cigarette sales increased by 122.2% during this timeframe (i.e., from 7.7 million to 17.1 million units per 4-week interval).
Despite overall sales growth, e-cigarettes sales fluctuated across time by product type. Specifically, during 2014-2019, sales of rechargeables, prefilled cartridges, and e-liquids grew relatively steadily over time. However, sales for disposables increased sharply from 10.3% of total sales in August 2019 to 19.8% in May 2020.3Tobacco Production in the United StatesA No Smoking sign
Although U.S. tobacco production has decreased significantly since the 1980s (from nearly 180,000 tobacco-growing farms to about 10,000 in 2012), the United States continues to be a leading producer of tobacco leaves.4
The United States is the fourth largest tobacco-producing country in the world, following China, India, and Brazil.5
Farms in the United States harvested more than 533 million pounds of tobacco in 2018.6
In 2018, two states–North Carolina and Kentucky–accounted for more than 70% of total tobacco cultivation.6Top of PageTobacco SalesCigarette SalesDuring 2017, about 249 billion cigarettes were sold in the United States—a 3.5% decrease from the 258 billion sold in 2016.7Four companies—Philip Morris USA, Reynolds American Inc., ITG Brands, and Liggett—accounted for about 92% of U.S. cigarette sales.
Imports, primarily from Canada and South Korea, accounted for approximately 8.3% of U.S. cigarette inventories in 2016 and 7.9% in 2017.
By state, the average retail price of a pack of 20 cigarettes (full-priced brands), including federal and state excise taxes, ranged from $4.62 in Missouri to a high of $10.67 in New York, as of November 2017.8
On average, federal and state excise taxes account for 44.3% of the retail price of cigarettes.8Other Tobacco Product SalesDuring 2012–2016, total U.S cigar unit sales grew by 29%, which was largely driven by increasing sales of cigarillos.9
The total amount of smokeless tobacco sold by manufacturers to wholesalers and retailers in the United States was about 126 million pounds in 2019, a decrease from 128.41 million pounds sold in 2018.2During June 2018–June 2019, three companies—Altria Group Inc., British American Tobacco and Swedish Match—accounted for nearly 98% of U.S. dollar sales of smokeless tobacco, with combined sales of more than $6 billion.10Top of PageEconomic Cost Estimates Associated With Cigarette SmokingCigarette smoking cost the United States more than $600 billion in 2018, including:
More than $240 billion in healthcare spending,11,12
Nearly $185 billion in lost productivity from smoking-related illnesses and health conditions,12
Nearly $180 billion in lost productivity from smoking-related premature death, and, 12,13
$7 billion in lost productivity from premature death from secondhand smoke exposure.13,14*Woman breaking a cigarette in halfEffects of Increased PricesIncreasing the price of tobacco products is the single most effective way to reduce consumption.13
A 10% increase in price has been estimated to reduce overall cigarette consumption by 3–5%.13
Research on cigarette consumption suggests that:
both youth and young adults are two to three times more likely to respond to increases in price than adults,15
lower income populations are more likely to increase quit attempts or smoke fewer cigarettes in response to price increases, although desire to quit and successful cessation may not be consistent across all racial/ethnic groups.16ReferencesU.S. Federal Trade Commission (FTC). Cigarette Report for 2019 [PDF – 1.1 MB]. Washington: Federal Trade Commission, 2021 [accessed 2021 Apr 27].
U.S. Federal Trade Commission (FTC). Federal Trade Smokeless Tobacco Report for 2019 [PDF -1 MB]. Washington: Federal Trade Commission, 2021 [accessed 2021 Apr 27].
Ali FRM, Diaz MC, Vallone D, et al. E-cigarette Unit Sales, by Product and Flavor Type – United States, 2014-2020. MMWR Morb Mortal Wkly Rep 2020;69:1313-1318. DOI: http://dx.doi.org/10.15585/mmwr.mm6937e2.
U.S. Department of Agriculture. 2012 Census of Agriculture: United States Summary and State Data, Volume 1, Part 51 [PDF–34 MB]. Washington: U.S. Department of Agriculture, National Agricultural Statistics Service, 2014 [accessed 2017 Nov 6].
Eriksen M, Mackay J, Schluger N, et al. The Tobacco Atlas. Atlanta: American Cancer Society; New York: World Lung Foundation [accessed 2017 Nov 6].
U.S. Department of Agriculture. Crop Production 2018 in 2015 Summary [PDF–1.98 MB]. Washington: U.S. Department of Agriculture, National Agricultural Statistics Service, 2019 [accessed 2019 Apr 9].
Maxwell JC. The Maxwell Report: Year End & Fourth Quarter 2017 Cigarette Industry. Richmond, VA: John C. Maxwell, Jr., 2018 [cited 2018 Apr 4].
Orzechowski and Walker. The Tax Burden on Tobacco, Volume 52. Arlington (VA): Orzechowski and Walker, 2017 [cited 2019 Apr 9].
Gammon DG, Rogers T, Coats EM et al. National and State Patterns of Concept–Flavoured Cigar Sales, USA, 2012-2016. Tobacco Control 2019; 28(4):394-400 [cited 2019 Jul 3].
Wells Fargo LLC (June 25, 2019) Equity Research/Tobacco. Nielsen ‘All Channel’ Data Through June 15, 2019 [cited 2019 Jul 3].
Xu X, Shrestha S, Trivers KF, et al. U.S. Healthcare Spending Attributable to Cigarette Smoking in 2014. Preventive Medicine 2021 (150): 106529. https://doi.org/10.1016/j.ypmed.2021.106529.
Shrestha SS, Ghimire R, Wang X, Trivers KF, Homa DM, Armour BS. Cost of Cigarette Smoking Attributable Productivity Losses, United States, 2018. Am J Prev Med 2022.
U.S. Department of Health and Human Services, 2014. The Health Consequences of Smoking—50 Years of Progress: a Report of the Surgeon General. U.S. Department of Center for Chronic Disease Prevention and Health Promotion, Office on Smoking and Health, Atlanta. https://www.cdc.gov/tobacco/sgr/50th-anniversary/index.htm.
Max W, Sung HY, Shi Y. Deaths from secondhand smoke exposure in the United States: economic implications. American Journal of Public Health 2012;102(11): 2173–80. doi: 10.2105/AJPH.2012.300805.
*The $7 billion number is based on original estimate from Max et al4 e. updated to 2018 dollars.
U.S. Department of Health and Human Services. Preventing Tobacco Use Among Youth and Young Adults: A Report of the Surgeon General. Atlanta: U.S. Department of Health and Human Services, Centers for Disease Control and Prevention, National Center for Chronic Disease Prevention and Health Promotion, Office on Smoking and Health, 2012 [accessed 2017 Nov 6].
U.S. Department of Health and Human Services. Smoking Cessation: A Report of the Surgeon General [PDF-9.82 MB]. Centers for Disease Control and Prevention, 2020 [accessed 2020 Apr 16].Top of Page
							
					
							Last Reviewed:  July 26, 2022						Source: 	Office on Smoking and Health, National Center for Chronic Disease Prevention and Health Promotion
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