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Japan Tobacco International (JTI) moved aggressively over the summer to take more control of its leaf acquisitions in international markets. On June 12, JTI announced it had bought the leaf tobacco business of the British dealer Tribac Leaf Limited, which has operated in Malawi, Zambia, China, and India, among others. Tribac's organization will be integrated into the Global Leaf Procurement Group. Tribac has agreed to supply JTI with leaf from Zimbabwe.
At the same time, JTI said it had agreed with the US leaf dealers Hail & Cotton and J.E.B International to form a joint venture to procure and process US leaf for JTI. JTI Leaf Services will begin contracting with farmers for the 2010 crop, said Jay Edward Barker, a principal in J.E.B. International. By the end of 2010 crop marketing, JTI Leaf Services plans to take delivery of most of its leaf at its own receiving stations, said Barker. These stations will be established throughout the tobacco-growing area, he added, though no locations were named.
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TOBACCO bosses have been slammed for “marketing death” by using beautiful young women dressed in orange satin jump suits to sell their product in busy bars.
Young women, carrying trays reminiscent of those used by ice cream vendors at cinemas, have been going into pubs selling cigarettes.
The pubs involved, which include the Centurion bar in Newcastle city centre, allow the girls into the bar in return for a small amount in commission for each packet sold.
The sales tactic was blasted by Ailsa Rutter, Director of Fresh – the campaign for a smoke-free North East.
She said: “What this is doing is glamorising the most lethal consumer product known.
“The last thing we need is the blatant promotion of cigarettes, which are the region’s biggest killer.
“There needs to be more regulation of an industry which is basically marketing death.”
Customers in the bar were approached by girls selling Benson and Hedges cigarettes on special offer – two packets for £6.
The percentage of smokers among adults has fallen 0.8 point from a year earlier to 24.9 percent, hitting a record low for the 14th straight year, an annual survey conducted in May by Japan Tobacco Inc. showed Friday.
"Multiple factors appear to have caused the decline, such as increased health awareness and tightening of regulations on smoking," said Japan's sole tobacco producer.
The smoking rate for men fell for the 18th consecutive year to 38.9 percent, down 0.6 point from the previous year, while the rate for women stood at 11.9 percent, down 1.0 point, following a 0.2 point rise the previous year.
Based on its latest survey, the total number of smokers was estimated at 26.01 million, down 790,000 from the previous year, JT said.
In addition to increasing restrictions on smoking in public places, the government's introduction of the Taspo smart cards has apparently discouraged smoking, JT said.
The percentage of smokers in Japan has fallen below a quarter of the adult population for the first time, with both men and women lighting up less, according to the results of a nationwide survey released Friday by Japan Tobacco Inc. (2914.TO).
In the annual survey, carried out in May by the world's third-largest tobacco producer by volume, 24.9% of respondents considered themselves to be smokers. The result is lower than last year's figure of 25.7%, and marks the lowest level since the company, known as JT, started compiling such data in 1965.
Japan had long been considered a smokers' paradise, with smoking rates hitting a peak of 49.4% in 1966. But the country has experienced a gradual decline in the number of smokers, due in part to an aging population, increased health consciousness and more stringent smoking regulations.
With slowing sales in Japan keeping a lid on revenue, JT is looking to gain a greater share of growing markets such as Russia and the Middle East
YOKOHAMA, JAPAN -- One plaintiff is a cancer patient. Another is represented by his widow. The third, has emphysema and rolls into the courtroom on a wheelchair with tubes trailing out of his nose.
The three Japanese are waging a minnow-vs.-whale battle against Big Tobacco in one of the world's most smoker-friendly countries. But precedent suggests they're likely to lose, and they hope their suit will at least draw attention to the dangers of smoking.
Even if they win, they're unlikely to dent the finances of Japan Tobacco Inc., a former monopoly still half-owned by the government. The three are asking for a total of 30 million yen ($320,000) from a company with 6.8 trillion yen ($72.8 billion) a year in sales.
Their larger goal, they say, is to gain stronger curbs on tobacco, and legal and social acceptance of a notion that much of the world now takes for granted: that smoking makes you sick.
They have a long way to go. . . .
The lawsuit demands sterner warning labels on cigarettes, a ban on cigarette vending machines, and an acknowledgment that smoking is addictive and harmful.
"When I began smoking, about 80 percent of men were smokers," Mizuno said. "The advertising phrase was, 'You're healthy when a cigarette tastes so good."'
When I began smoking, about 80 percent of men were smokers. The advertising phrase was, 'You're healthy when a cigarette tastes so good.'Masanobu Mizuno, one of the plaintiffs in the 4 1/2 year old suit against Japan Tobacco. Arguments have concluded; a decision is due by Jan. 20, 2010.
Japan Tobacco Inc., the world’s third-largest publicly traded cigarette maker, said first- quarter operating profit plunged 24 percent as domestic sales dropped and the yen gained.
Operating profit fell to 84.3 billion yen ($887 million) for the three months ended June from 110.5 billion yen a year earlier, the Tokyo-based company said in a statement today. Sales slipped 15 percent to 1.46 trillion yen from 1.72 trillion yen.
The maker of Camel and Mild Seven cigarettes is losing sales in Japan as the smoking rate falls and tighter tobacco controls are introduced. The yen’s rise against the dollar and other currencies eroded gains from overseas cigarette sales helped by the 2007 takeover of U.K.-based Gallaher Group Plc.
“Japan Tobacco was among victims by the global recession,” said Mitsuo Shimizu, an analyst at Tokyo-based Cosmo Securities Co. “It needs to seek growth outside Japan, which makes it more vulnerable to currency swings.”
The Tobacco Institute of Japan, the industry body of tobacco manufacturers, has turned over vending machine use logs on cigarette pack purchases by certain individual smokers to public prosecutors when they requested such information for investigative purposes, informed sources said Sunday. Such logs of ''taspo'' smart cards included records on when and at which vending machines the smokers bought cigarette packs, as well as their dates of birth, addresses and phone numbers, the sources said.
There has been a case in which the provided logs helped investigators find a person who had evaded some fines, the sources said. . . .
An institute official told Kyodo News, ''We have kept track of purchases-related logs to check if taspo cards that were stolen or for which reports of loss have been filed may have been used illicitly, and we basically would not provide them to third parties.''
''But we cannot help turning over such logs as well as the addresses, names, dates of birth and contacts of cardholders to investigative authorities as necessary if the authorities request the logs in writing in line with the Code of Criminal Procedure,'' the official said.
DANVILLE - A partnership between Japan Tobacco Inc. and J.E.B. International Co. to purchase and process tobacco could bring a $30 million tobacco processing facility and 200 jobs to Danville.
Japan Tobacco signed an agreement with U.S. leaf tobacco suppliers J.E.B. International and Hail & Cotton in June to form a joint venture company called JTI Leaf Services LLC. . . .
Funded with an initial investment of $5 million, JTILS will contract directly with farmers to buy tobacco throughout the flue-cured and burley belts, creating a direct supply pipeline for Japan Tobacco, said Barker. . . .
Japan Tobacco also signed an agreement in June to acquire business from Tribac Leaf Limited, a British tobacco company that operates in several parts of the world, including Malawi, Zambia, China and India.
Japan Tobacco also entered into a long-term agreement with Tribac to supply leaf tobacco from Zimbabwe.
The international partnerships are designed to secure a steady supply of quality tobacco for Japan Tobacco, the world's third largest tobacco company.
The new international partnership plans to sign contracts with farmers for the 2010 season.
Japan Tobacco Inc. said Wednesday it will acquire all outstanding shares in Brazilian leaf tobacco suppliers Kannenberg & Cia. Ltda. and Kannenberg, Barker, Hail & Cotton Tabacos Ltda.
The acquisitions, due to be completed in October, are part of JT's efforts to secure stable sources in three of the world's major leaf tobacco suppliers -- Africa, the United States and Brazil, the company said.
Two leaf tobacco suppliers in Virginia and Tennessee are forming a joint venture company with Japan Tobacco Inc.
Japan Tobacco says in a news release that the new company, JTI Leaf Services LLC, will supply it exclusively with contracted U.S. leaf tobacco.
Danville, Virginia-based J.E.B International Co. and Hail & Cotton of Springfield, Tennessee signed an agreement last month with Japan Tobacco to participate in the venture.
Hiroshi Kimura, Japan Tobacco Inc.'s president and chief executive, had to start last year's annual report with an apology. It wasn't about the sale of tobacco-related products but rather for pesticide-laced gyoza, or dumplings, imported from China and sold by the group's JT Foods subsidiary. . . .
in 1999 JT took an international turn when it acquired RJR International, the non-U.S. operations of R.J. Reynolds Tobacco Co., and renamed the unit JT International. Mr. Kimura was then vice president of JT's corporate-planning division and subsequently became JTI's executive vice president.
Tor Ching Li spoke with Mr. Kimura at his office in Tokyo. The interview has been translated from Japanese and edited.
WSJ: What did you learn from your first job?
Mr. Kimura: After graduation I joined Japan Tobacco and Salt Public Corporation, at a product-development unit where I was involved in conceptualizing brands, naming, choosing package design and test-marketing. I was lucky to have been involved in the launch of a couple of products that are still core products of the company, such as the Mild Seven and Cabin labels.
When I first joined I learned from a senior the [French] phrase noblesse oblige, which I understood to mean not shirking the responsibilities of your position. . . .
WSJ: What are the challenges facing your industry?
Mr. Kimura: There is a universal trend toward stricter restrictions on smoking. While we recognize that tobacco is a controversial product and regulation is necessary, we oppose over-regulation, and believe that rules need to be tailored to the situation in order to be enforceable. We also see regulation as an opportunity. Through consultation with the relevant authorities, we give our feedback and suggestions, such as the creation of smoking booths for areas where smoking on the street is banned.
garettes -- at $1.05 per pack -- making the country a bonanza for smugglers, whether by glider or more mundane pathways on the ground. Cars and trucks filled with Ukrainian-made Marlboros and Viceroys get waved through border checkpoints by customs guards who seem more than eager to accommodate, for a price. Loads also move by bus and train, bound for other European countries where high taxes make packs cost as much as $5 (Germany) or $10 (United Kingdom).
The backbone of this underground commerce -- the acquisition of the cigarettes themselves -- is by far the easiest part of the entire operation. The world's four leading multinational tobacco companies, Philip Morris International, Japan Tobacco International (JTI), Imperial Tobacco, and British American Tobacco (BAT), have produced billions of excess cigarettes in Ukraine, fueling a teeming black market that reaches across the European Union. Today, Ukraine is rivaled only by Russia as the top source of non-counterfeit brand cigarettes smuggled to Europe, EU officials say.
The booming trade in tobacco smuggling has major consequences, say industry experts. The growing traffic pushes huge supplies of cheap, untaxed, and unregulated cigarettes into the rest of Europe, undercutting otherwise successful attempts to curtail smoking. Worse, officials say, the trade is boosting organized crime gangs, who find the soft penalties and big profits hard to resist. . . .
Attracted by high smoking rates and the potential for rapid returns on investments, multinational tobacco companies rushed to acquire the state-run cigarette factories after the Soviet regime collapsed in 1991. Today, the big four tobacco companies -- Philip Morris, BAT, JTI, and Imperial -- control 99 percent of the Ukrainian cigarette market.
Ton Wurtz, treasurer of the foundation 'Red de kleine horecaondernemer' (Save the small hospitality entrepreneur), has admitted to receiving "about 50,000 euros per year" from the tobacco companies. Wurtz also holds biweekly strategy talks with Willem Jan Roelofs, the chairman of the cigarette industry foundation SSI, he said.
Smoking was banned in cafes, bars, hotels and restaurants in The Netherlands a year ago. Just before the ban went into effect on July 1, 2008, Wurtz, who has been the spokesperson for a foundation that stands up for smokers since 1993, and other seasoned tobacco lobbyists established the foundation to represent the interests of small cafe owners.
The smoking ban was primarily adopted to guarantee the right of employees to work in a smoke-free environment. But critics say small bars, with no employees except the owners, should be exempt from the ban. Several court cases are underway against cafes that defied the ban.
The law firm representing the small cafe owners has been negotiating with the tobacco industry about the possibility of it bankrolling future lawsuits challenging the smoking ban. . . .
"We are talking to several parties about financing a procedure, SSI amongst them," Marco Gerritsen of the Van Diepen Van der Kroef law firm confirmed. "They haven't promised anything yet."
SSI's is a collaboration between British American Tobacco (Pall Mall), Imperial Tobacco (Gauloises) and Japan Tobacco International (Camel); Philip Morris (Marlboro) left the group in 2005. Tobacco companies fear a decline of 5 percent of sales because of the smoking ban in bars. Roelofs: "That is a substantial loss in an already contracting market." He denied the SSI has any intention to finance future court cases.
Japan Tobacco Inc., the world’s third-biggest maker of cigarettes, climbed to a six-month high in Tokyo trading after agreeing to acquire Tribac Leaf Ltd. to improve its access to tobacco growers.
Japan Tobacco rose 7.3 percent to 325,000 yen at the close of trading on the Tokyo Stock Exchange, the highest since Dec. 8.
Japan Tobacco Inc, the world's third-largest tobacco firm, said it is likely to hike its domestic cigarette prices within the next three years to secure a profit amid a steadily shrinking market.
Like other developed nations, Japan's smoking population has been declining due to growing health awareness, hitting Japan Tobacco, a former state monoply which controls 65 percent of the domestic cigarette market.
There has been growing speculation that Japan Tobacco would hike its cigarette prices for the first time since July 2006 after it set a target of keeping its core profit from its domestic tobacco business steady for the three years through to March 2012.