had a boom in the last several years, despite some earlier concerns about problems for sales to some traditional customers. The European Union has an import duty of 57.6% ad valorem for imports from most non-EU members and that tends to inhibit Swiss exports to 27 countries, where Germany, Netherlands, and France are major suppliers. Swiss cigarette manufacturers have arranged to produce high quality blended cigarettes and make them available at attractive prices. The average export price declined from 23.6 cents per pack of 20 in 2004 to 18.2 cents in 2006. The average price for cigarettes exported from Switzerland in early 2007 was about half the average price for exports from Germany.
New Peak For Cigarette Exports Reached In 2006, Shipments Remained Strong In 2007
The value for Swiss cigarette exports roared to a peak of 40.77 bn pieces in 2006, valued at $375.9 mn. The 47% increase for Swiss cigarette exports in 2006 placed the country among the fastest growing exporters of cigarettes in the world. Some other rapidly growing cigarette exporters in the last two years were Poland, Ukraine, and Russia. Use of imported US tobacco for blended brands by Swiss factories increased recently.
Rising cigarette exports caused Swiss imports of leaf tobacco to increase recently. US exports of leaf tobacco to Switzerland in 2006 reached 17.480 tons valued at $95.9 mn, that included $67.9 mn for flue-cured and 25.6 mn for burley shipments to Switzerland in 2006. Brazil is a major supplier of Swiss imports of leaf tobacco.
Swiss Cigarette Exports To EU Rebounded In 2006
Some Swiss cigarette exports to EU countries go to free trade zones or transit traders filling orders for customers in the Middle East. The comparatively low export price for Swiss cigarettes may attract more customers within the EU as the rising value of the euro tends to make cigarettes manufactured in most EU countries more expensive to shoppers from outside the 11 countries where the euro is their official currency.
Swiss cigarette exports to EU countries rose to 14.3 bn pieces in 2006, compared with 11.2 bn pieces in 2004. Yet, the increase in exports to Netherlands to 11.1 bn pieces in 2006 may have reflected increased distribution to other countries and ship stores rather than just greater sales to Dutch smokers. Problems for the Antwerp transit trade by strict EU rules apparently contributed to the decline for Swiss cigarette exports to Belgium from 9.3 bn pieces in 2005 to a tenth that quantity by 2005, followed by the shipment of 1.1 bn pieces in 2006. Sales of some premium brands appear to have contributed to the rise for Swiss cigarette exports to Germany from 530 mn pieces in 2004 to 1.9 bn pieces in 2006.
Italy had been an important customer for Swiss cigarette exports before the European Union became a major factor for Italian imports. Swiss cigarette exports to Italy increased 23.7% to 73 mn pieces in 2006. Swiss cigarette exports to France declined 15% to 17 mn pieces in 2006. Strong competition from German and Austrian exporters limited Swiss cigarette export to the 12 new EU members joining in 2004. Yet, Swiss cigarette exports to Poland reached $249,000 in 2006, compared with a token $1,000 in 2005, and exports to Czech Republic rebounded to $164,000 in 2006 - triple the 2005 level. Cyprus was a customer for 114 mn Swiss cigarettes valued at $1.4 mn in 2006 - more than double the 2004 level.
Swiss Cigarette Exports To CIS Were Higher In The Past
The rise in output of quality blended cigarettes by multinationals in Russia and Ukraine has limited prospects to expanding Swiss cigarette exports to CIS countries. Russian Federation was a customer for Swiss cigarettes valued at $622,000 in 2006, compared with $1.1 mn in 2004. Despite a rising surplus of cigarettes for export by Ukraine, Swiss cigarette sales to this market nearly doubled in 2006, reaching $833,000.
Iran Was The Major Growth Market For Swiss Cigarette Exports During 2004–06
A major factor behind the boom in Swiss cigarettes was the way shipments to Iran nearly tripled between 2004 and 2006, rising from 3.2 bn to nearly 9 mn bn pieces. The value for shipments to Iran reached $95.9 mn in 2006, compared with $58.1 mn in 2005 and $35 mn in 2004. Iran reduced the import duty for cigarettes from 40% ad valorem several years ago to 4%. This contributed to the increase in direct imports into Iran when the GCC boost for the import duty on cigarettes rose from 100 to 150% ad valorem. That tended to hamper the transit trade for cigarettes on their way to Iran through other Middle East countries.
Swiss Cigarette Exports To Arabian Peninsula Rising:
Switzerland also had strong gains for cigarette exports to countries of the Arabian Peninsula. Shipments to Saudi Arabia doubled in 2006 - reaching 8.06 bn, valued at $43.4 mn. Exports of Swiss cigarettes to Jordan zoomed from 304 mn pieces in 2005 to 1.3 bn pieces in 2006. Exports to UAE nearly doubled in 2006 - reaching 881 mn pieces. Dubai is the leading trader among the seven emirates of UAE, with tremendous trade in the Jebel Ali free trade zone.
Swiss cigarette exports to Kuwait reached 633 mn pieces in 2006 - six times the 2004 level. This indicates that the share of Kuwait’s cigarette imports from Switzerland roared upward while the share for more important suppliers like the United States and UK declined. Swiss cigarette exports to Qatar rose to 311 mn pieces in 2006, compared with 26 mn pieces in 2004. Bahrain was a customer for 135 mn cigarettes from Switzerland in 2006 - up 72.4% from 2005 deliveries.
Direct Exports To Iraq Reported In 2005 And 2006
Switzerland began direct cigarette exports to Iraq in 2005 with the delivery of 224 mn pieces and the business grew to 930 mn pieces valued at $8.2 mn in 2006. Some of the cigarettes valued at $639 million exported to Turkey in 2005 were apparently mostly for delivery to transit traders doing business in Iraq.
Swiss cigarette exports to Syria reached a peak of 2 bn pieces in 2005 and declined to about 1.6 bn pieces in 2006, valued at $17.5 mn. A pathway to Iraq for some consumer goods is Jordan. Swiss cigarette exports to Jordan climbed from 304 mn pieces in 2005 to 1.3 bn pieces in 2006, valued at $8.5 mn.
Competition Caused Fluctuations For Exports To Far East
Competition among cigarette traders in the Far East is keen, and Swiss exporters saw their shipments to Japan decline from $638,000 in 2004 to $234,000 by 2006. The worst decline was for shipments to Singapore from $2.56 mn in 2004 to $368,000 by 2006. Taiwan was a growth market where exports rose from 96 mn pieces in 2004 to 705 mn pieces valued at $6 mn in 2006.
Cigarette Exports To North America Rising
Swiss cigarette exports to Canada increased 32% to $3.36 mn in 2006. Exports of Swiss cigarettes to the United States were up 75% to $792,000 in 2006, with gains for some premium brands. Some Swiss cigarette exports go to free trade zones and traders serving cruise ships. US trade data reported clearance through customs of 42.5 mn cigarettes valued at $718,000 in January–September 2007. Mexico and Caribbean countries are small markets, including deliveries to tourist centers.