Smokers’ ordeal

Ahmed Morsy , Saturday 24 Feb 2024

Smokers are grappling with hikes in cigarette prices.

Smokers  ordeal
Tobacco prices in Egypt jumped 73 per cent higher in December 2023 compared to the same month the year before. Reuters

 

Cigarette prices in Egypt recently increased for all types, marking the second hike in less than four months.

On Saturday, Egypt’s largest tobacco producer Eastern Company increased the price of all brands by LE2 to LE8. This included the most locally affordable brand, Cleopatra, which is now priced at LE30 instead of LE27 for a pack of 20 cigarettes, up from LE24 in November.

On 11 February Philip Morris Egypt raised its popular cigarette brands, including Marlboro, Merit, and L&M by LE 9-11 per pack. In November, the cost of these tobacco products increased by LE10.

According to figures released by the Central Agency for Public Mobilisation and Statistics (CAPMAS), tobacco prices jumped 73 per cent higher in December 2023 compared to the same month the year before.

Hani Aman, CEO of Eastern Company, pointed out that the increase in cigarette prices is “very slight” compared to the significant increase in the price of raw materials. In a TV phone-in this week, Aman said that 95 per cent of cigarette components are imported. “The price of cigarette filters has increased by about 400 per cent,” he said.

But the problem is not that cigarette producers increased their prices as much as that cigarettes are sold at a considerable mark-up by retailers.

“I scour multiple outlets to find cigarettes at a reasonable price,” Ahmed Gamal, 32, told Al-Ahram Weekly, describing his daily pursuit to buy his cigarette pack at the lowest price. By “reasonable”, he means a mark-up of up to LE10 above the official price.

Only two well-known outlet branches sell cigarettes at their official price. And due to the limited number of stores, smokers resort to supermarkets and kiosks most of the time where they buy them at varying prices, but are at least LE10 more expensive per pack, Gamal said.

“Every kiosk sets its own price for the same cigarette brand. Prices range from LE10 to LE15 above the official price. Sometimes, if you are a regular customer at a particular kiosk, the seller might sell it to you for LE5 above the official price,” said Marwan Gamil, a 40-year-old smoker.

For instance, Merit cigarettes, which have officially increased to LE85 per pack from LE74, are being sold in kiosks for LE95 or even LE100 at times, Gamil said, adding that a 20-cigarette pack of Cleopatra is sold at LE45 while its official price is LE30.

Only at convenience stores located at some gas stations are cigarettes sold at official prices, Gamil said, adding that they often impose a limit of one or two packs per person. “Since these stores are not everywhere, I usually end up at the mercy of prices at kiosks,” Gamil said.

Meanwhile, some smokers complain about their inability to find their preferred brands at gas stations.

“The brand I smoke is not available at any store that sells at the official price. Therefore, I buy it from kiosks at a higher price. The pack costs LE59 but sells for LE70,” a smoker told the Weekly.

While some smokers switched to cheaper cigarette brands due to the price hikes, others began searching online to buy their preferred brands at official prices.

On the disparity of prices, a kiosk owner in downtown Cairo told the Weekly that kiosk owners find themselves at a crossroads. “We ourselves are victims due to the distribution system,” he said.

He said they charge higher prices because the quantities provided by the official distributors affiliated with the tobacco companies are limited. In the past, he said, the Eastern Company distributor would provide them with the quantities they asked for on a daily basis. Similarly, the distributor of foreign brands used to visit twice a week, supplying whatever quantity they wanted, the kiosk owner said.

This, he added, forces them to resort to the parallel market and deal with one of two key merchants who control the market located at Bab Al-Bahr, a popular wholesale market for cigarettes in downtown Cairo where distributing tobacco brands is monopolised.


* A version of this article appears in print in the 22 February, 2024 edition of Al-Ahram Weekly

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