The tobacco products market is projected to reach US$ 907,665.43 million by 2028 from US$ 782,022.19 million in 2021. It is expected to grow at a CAGR of 2.2% from 2021 to 2028.

Tobacco products include cigarettes, cigars, cigarillos, e-cigarettes, vapes, snus/snuff, dissolvable tobacco products, among others. The rising number of smokers in developing regions such as Asia-Pacific and the Middle East & Africa is primarily driving the growth of the tobacco products market. Moreover, manufacturers are developing premium and low-risk products, having reduced health implications than combustibles. These products are expected to gain massive traction among people with the rapidly growing awareness regarding harm caused by smoking.

Based on product type, the tobacco products market is segmented into cigarettes, cigars & cigarillos, roll-your-own, and others. The cigarettes segment accounted for the largest market share in 2020. Virginia, Burley, and Oriental are the three main categories of tobacco. These three tobacco categories are blended in different proportions to manufacture different cigarette types. The rising number of female smokers with the growing popularity of flavored cigarettes is supporting the market growth. Cigarettes are available in various flavors, including confectioneries, alcoholic beverages, herbs, and spices. Menthol is one of the most widely used and recognizable flavors in tobacco products. According to the World Health Organization (WHO), menthol-flavored cigarettes represented ~10% of the total cigarette market with a share greater than 25% in many countries, including the Philippines, Chile, Singapore, and the US, in 2018.

Based on geography, the tobacco products market is primarily segmented into North America, Europe, Asia-Pacific (APAC), the Middle East & Africa (MEA), and South & Central America. In 2020, Asia-Pacific held the largest share of the market, and the MEA is expected to register the highest CAGR in the market during the forecast period. Many tobacco companies are increasingly targeting developing economies such as India and Bangladesh to expand their business operations as these markets have strong growth potential. Asia-Pacific is one of the significant producers and consumers of tobacco products globally. Moreover, the laws imposed on tobacco products in countries such as India are lenient compared to the laws in developed countries. These factors are fueling the growth of the tobacco products market across Asia-Pacific.

The leading players in the tobacco products market include Altria Group, Inc.; British American Tobacco plc; Swedish Match AB; ITC Ltd.; Japan Tobacco International; Imperial Brands; Philip Morris Products S.A.; Vector Group LTD.; Pyxus International, Inc.; and China Tobacco International (HK) Company Limited. These players are developing reduced-risk products (RRPs) to address the growing concerns regarding the harms of combustible tobacco products. RRPs include heated tobacco products such as e-cigarettes and vapes, and smokeless tobacco products such as snus and dissolvable tobacco. The rising development of low-risk tobacco products by key players operating in the market is expected to support the growth of the tobacco products market in the coming years.

The size of the tobacco products market has been derived using primary and secondary sources. To begin the research process, exhaustive secondary research has been conducted using internal and external sources to obtain qualitative and quantitative information related to the market. Also, multiple primary interviews have been conducted with industry participants to validate the data and gain more analytical insights. Participants of this process include industry experts such as VPs, business development managers, market intelligence managers, national sales managers, and external consultants, including valuation experts, research analysts, and key opinion leaders, specializing in the tobacco products market.