Cigarette sales in America were declining. Then covid hit

Cigarette sales in America rose last year for the first time in two decades, new report From the Federal Trade Commission says. It was a slight increase of just 0.4% – the total number of cigarettes sold to wholesalers and retailers nationwide increased by nearly 8 million, from 202.9 billion in 2019 to 203.7 billion in 2020.

But it does represent a sudden reversal of a long-term downtrend.

Adult smoking rates in the United States have been declining since 2000 and now stand at about 14%, according to the Quitline Association of North America, a nonprofit that promotes smoking cessation services.

The group credits steady declines in tobacco taxes and smoke-free air laws, as well as the increased use of programs such as smoking cessation lines. But the organization said that during the pandemic, fewer smokers were using these services in a report earlier this year, citing “the stress and anxiety caused by the pandemic.”
The FTC report did not explain why sales were up, but the rise tracks similar shifts in consumer behavior due to the pandemic. For example, retail alcohol sales rose in the spring of 2020, not only because bars and restaurants closed, but because consumers were drink more. Last year, researchers reported in the journal JAMA Network Open, that the overall frequency of alcohol consumption increased by about 14% from 2019 to 2020.

Experts say increased isolation, stress, and uncertainty have created a perfect storm for substance use disorders.

Altria, which makes Marlboro cigarettes, noted in a recent earnings call that the 2020 shutdowns saw Americans “add nicotine occasions to their day.” According to the Wall Street Journal, smokers are also switching to traditional cigarettes from vaping devices in response to restrictions on e-cigarette flavors.

Altria (MO)The company’s shares are up 16% so far this year.

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