HEADLINES

• North East Lincolnshire surge in underage tobacco sales
• Smoking linked to increased depression in teens
• Northern Ireland: Charity calls for smoking ban to protect young people
• New Zealand: Cigarette sales down since tax increase
• USA: Tobacco floats new products but relies on pricing

• North East Lincolnshire surge in underage tobacco sales

  A sharp rise in illegal sales of alcohol and tobacco to children has been reported by trading standards officers in North East Lincolnshire.

  Council officials said test purchases, in which youngsters are sent into shops, had shown a big increase in underage sales this year.

  So far in 2010, 39% of shops had failed the test, compared to 8% in the whole of 2009, officials said.

  The drop in 2009 was attributed to a clamp down by the council and police.

  Last year's campaign targeted retailers throughout Grimsby and Cleethorpes amid increasing concern about the number of shop staff who were prepared to sell alcohol and cigarettes to youngsters.

  In 2005, 40% of test purchases had failed.

  Steve Beasant, North East Lincolnshire Council's portfolio holder for community safety, neighbourhoods and customer services, said the problem involved sales of cigarettes in particular.

  He said: "It is unacceptable that some retailers believe it is right to sell underage individuals tobacco products, possibly leading to addiction at a young age.

  "I urge the public to be alert to any instances where age-restricted products are being sold to youngsters and to report any incidents they witness."

  The council said anybody who knew of anyone selling tobacco or alcohol to children should report the matter to trading standards.

  Source: BBC News, 28 August 2010
  Link: http://bbc.in/9V3ZjV

• Smoking linked to increased depression in teens

  Despite thoughts that smoking a cigarette will help them fight the blues, teenagers may actually increase depressive symptoms by doing so, according to a new study conducted by scientists at the University of Toronto and the University of Montreal.

  Researchers studied 662 high school teenagers from grades 7 to 11. Participants were divided into three groups: those who never smoked, smokers who puffed to feel better - or in the researchers' terms “self medicate” - and those who said they smoked for the sake of smoking.

  “Although cigarettes may appear to have self-medicating effects or to improve mood, in the long term we found teens who started to smoke reported higher depressive symptoms,” said lead author Michael Chaiton, a research associate at the Ontario Tobacco Research Unit of the University of Toronto.

  Depressive symptoms were measured using a scale that asked how often participants felt too tired to do things, had sleeping trouble, felt unhappy, sad or depressed and felt hopeless about the future.

  “Smokers who used cigarettes as mood enhancers had higher risks of elevated depressive symptoms than teens who had never smoked,” said co-author Jennifer O’Loughlin, a professor at the University of Montreal Department of Social and Preventive Medicine and scientist at the of the University of Montreal Hospital Research Centre.

  Source: Toronto Sun, 27 August 2010
  Link: http://bit.ly/bsC1UJ

• Northern Ireland: Charity calls for smoking ban to protect young people

  A leading Northern Ireland charity is calling for smoking to be banned in vehicles carrying children and teenagers under 16 years of age.

  Smoking has been banned in public places such as bars and restaurants since 2007.

  Action Cancer, however, said more needed to be done to protect young people from second-hand smoke.

  The charity's Geraldine Kerr said it was now recognised as a danger to public health.

  "The damaging effects of environmental tobacco smoke (ETS), otherwise known as second-hand smoke, are well documented and it's now recognised as a substantial public health hazard," Ms Kerr said.

  "The main places children and young people face exposure to ETS is within the home and vehicles.

  "Northern Ireland should lead the way and introduce a smoking ban in vehicles to ensure our children are not exposed to second-hand smoke, reducing the levels of health problems, economic commitment to treating these health problems and likelihood of smoking uptake later in life."

  Action Cancer is to launch a lobbying and briefing campaign aimed at ensuring wide-ranging political support for a commitment to early legislation on a smoking ban to protect minors.

  Ms Kerr said the charity would be encouraging the political parties to adopt a pledge to support the ban as a commitment in their manifestos for the forthcoming Assembly election.

  Source: BBC News, 31 August 2010
  Link: http://bbc.in/cBSFOZ

• New Zealand: Cigarette sales down since tax increase

  Cigarette sales have fallen 15% since parliament raised the tax on cigarettes and tobacco, an anti-smoking lobby group says.

  Parliament in April voted 118-4 to raise the tax by 10%.

  End Smoking New Zealand said the 15% decrease in supermarket sales was much greater than forecast.

  The charitable trust analysed weekly cigarette sales from supermarkets over the past year and found sales of both roll-your-own and tailor-made cigarettes were down 15% overall.

  The fall was so great that excise revenue was unchanged, and Treasury would miss out on the $200 million extra expected as a result of the increase, chairman Dr Murray Laugesen said.

  MPs have legislated for a further 10 percent tobacco tax increase in January 2011 and 10% again in January 2012.

  Source: TVNZ, 30 August 2010
  Link: http://bit.ly/cz014N

• USA: Tobacco floats new products but relies on pricing

  The growth of a new smokeless tobacco product in the United States is nothing to spit at, but cigarette companies still rely on their standard method for increasing profits -- raising prices.

  The two largest U.S. tobacco companies -- Altria Group Inc (MO.N) and Reynolds American Inc (RAI.N) -- have been expanding distribution of snus, a type of smokeless, spitless moist snuff tobacco popular in Scandinavian countries, as they look for products to sell to smokers trying to quit cigarettes.

  Snus has been a moderate hit since Swedish Match AB brought it to the United States 10 years ago, but pushing new products has not driven profits enough to shift tobacco companies' focus away from cigarettes.

  Cigarette makers still count on raising prices to earn profits.

  "(Tobacco companies) definitely see smokeless as a longterm piece of the business," said Morningstar analyst Phil Gorham. "But don't be fooled, even though it's a growth category and cigarettes are in decline, it's still a small part of the overall business."

  Cigarette consumption in the United States shrinks more than 2 percent each year, according to Euromonitor International data, but companies such as Marlboro cigarette maker Altria, Camel maker Reynolds and Newport maker Lorillard Inc (LO.N) use price hikes to compensate.

  That was harder to do in the last year as Reynolds used promotions to try to grab market share, said Gorham, who follows tobacco companies at Morningstar.

  Gorham expects a 3 to 4 percent price increase from all three major players this fall.

  The price gap between premium brands such as Marlboro and Camel is smaller than in past years, said Stifel Nicolaus analyst Chris Growe. Because of that, he predicted increases of at least 5 cents a pack for premium brands later in the year.

  Still, focusing on cigarette prices does not prevent tobacco companies from trying to increase sales volume overall, which has led to the appearance of snus (rhymes with "loose") in convenience stores and gas stations.

  Swedish-style snus grew 122 percent by volume in the United States in 2007-08 and 28 percent in 2008-09, up from a small base, according to Euromonitor data.

  Stockholm-based Swedish Match reported U.S. consumption of General brand snus was four times higher in 2009 than in 2008.

  The overall smokeless tobacco category is growing by 6 to 7 percent a year, said Gorham, but compared with cigarettes, smokeless is tiny, and snus is even smaller.

  Smokeless in total represents about 2 percent of tobacco companies' revenue; snus makes up about 0.5 percent of moist snuff sales in the United States, according to Euromonitor data.

  Gorham said the role of smokeless products, and snus in particular, has been to allow cigarette makers to hang on to customers who want to quit smoking.

  Companies tie snus to leading cigarette brands, pitching it as a cheaper, safer alternative to smoking and offering coupons for snus on cigarette packs.

  Altria's Marlboro and Reynolds American's Camel brands have snus variants, and a partnership between Swedish Match and Philip Morris International Inc (PM.N) is being tested in South Africa. Some analysts expect Lorillard to enter the market soon.

  "That really targets the smoker that wants to quit and move on to something else," Gorham said. "I don't think the purpose is really to attract a new kind of customer, it's just to prolong the period of time over which they can keep taking cash from smokers who are trying to quit."

  Snus' penetration in the tobacco market is still limited. There is not much evidence of nonsmokers picking up snus, and tobacco companies have trouble selling to women and consumers with no history of smokeless use, said Euromonitor analyst Don Hedley.

  Snus is banned in most of the European Union due to World Health Organization fears that smokeless tobacco causes oral cancer.

  "It's a big barrier because, apart from the U.S., where there is a smokeless tradition, EU countries, with high cigarette prices, smoking bans and high health consciousness, would have the best potential," Hedley said in an email.

  Congress passed a law in 2009 that handed new regulatory powers to the U.S. Food and Drug Administration over the marketing and production of tobacco products. The new law adds uncertainty to tobacco companies that are wondering what types of new products they may be allowed to launch in the future.

  The agency has tightened rules for cigarette advertising and is studying menthol cigarettes, prompting Lorillard to announce a nonmenthol version of its popular Newport brand.

  Public health experts have split over whether to promote smokeless products, battery-powered electronic cigarettes -- which allow the user to inhale nicotine in a vaporized solution -- and other noncigarette products as a step to quitting smoking, said John Banzhaf, executive director of Washington, D.C., nonprofit Action on Smoking and Health.

  "Do we lightly regulate and in effect encourage these other products to allow people to switch from smoking and remain forever on e-cigarettes or snus or whatever?" Banzhaf said.

  "If the philosophy in the FDA is that the public health can be served by encouraging the development of snus and other products, they can write regulations that do exactly that," he said.

  Altria shares were down 1.3 percent at $22.55 on the New York Stock Exchange on Thursday afternoon. Reynolds shares were down 1.1 percent at $56.04, Lorillard was down 0.5 percent at $77.61 and Philip Morris was down 0.9 percent at $51.05.

  Source: Reuters News, 27 August 2010
  Link: http://bit.ly/aKgln2