Market evolution: Tobacco products (CN 2402) — 2015–2025

Introduction

This report analyzes the trade performance of the European Union in cigars, cheroots, cigarillos, and cigarettes (customs code 2402) over the 2015–2025 period. The EU has undergone a significant transformation in this sector, characterized by a strategic pivot from volume-driven exports to a higher-value, more specialized trade profile. Simultaneously, the bloc's import structure has shifted dramatically in response to geopolitical changes and the emergence of new supply partners. Internal production has contracted sharply, reinforcing the EU's role as a major net exporter of high-margin tobacco products.

The Great Pivot: Rising Export Values Amidst Declining Volumes

The EU's external trade in tobacco products is defined by a clear divergence between quantity and value trends, signaling a fundamental shift in market strategy and product mix.

A sustained decline in export volume contrasted with resilient value. Between 2015 and 2025, the quantity (net mass) of EU exports fell by 42.4%, from nearly 140,000 tonnes to just over 80,000 tonnes. Despite this, the total export value decreased by only 11.3%, remaining robust at €2.35 billion in 2025. This resilience points to a significant increase in the average unit price, which rose by 54.1% per tonne over the period, suggesting a strategic shift towards higher-value-added products (General Overview).
The structural shift is even more pronounced in the supplementary unit count. Measured by the number of items (in thousands), export volumes fell by 36.8%. However, the value per thousand items surged by 40.4%, from €20.96 in 2015 to €29.42 in 2025. This confirms the movement towards premium products, where higher value compensates for lower physical output (General Overview).
The EU maintains a large, but eroding, trade surplus. The EU consistently ran a substantial trade surplus in tobacco products, peaking at €2.39 billion in 2015. By 2025, this surplus had contracted to €1.85 billion, a decrease of 21.4%. This contraction is driven by the combination of falling export values and steadily rising import values, which grew by 68.6% over the decade (General Overview).

The New Import Map: From the UK to Türkiye and the Balkans

The EU's import sources have been completely reconfigured, driven by the United Kingdom's exit from the EU and a surge in shipments from candidate and Western Balkan countries.

Brexit triggered a collapse in UK-sourced imports. In 2015, the UK was the EU's largest import partner for tobacco products by value, supplying goods worth €118.7 million. By 2025, this figure had plummeted by 99.4% to a mere €764,000. This dramatic collapse is the single most significant shift in the EU's import structure, directly attributable to the UK leaving the EU's customs union (General Overview).
New partners, primarily from the Western Balkans and Turkey, have filled the void. Following the UK's exit, import value from Türkiye and Serbia exploded, growing by 1,018% and 5,064% respectively over the period. By 2025, they had become the first and second largest import partners. Other significant growth was seen from Cuba (+104%), the Dominican Republic (+143%), and Honduras (+184%), indicating a growing demand for specific cigar types (General Overview).
The import market has become less concentrated. The Herfindahl-Hirschman Index (HHI) for import concentration (by value) fell by 38%, from 2,294 to 1,423. This drop reflects the shift from a high-concentration structure dominated by the UK to a more diversified, but regionally focused, network of suppliers in the Balkans and Turkey (General Overview).

Internal Transformation: Declining Production and Shifting Specialization

The changes in trade flows are mirrored by a profound contraction in domestic production and a reshaping of internal EU competitive advantages.

EU production volumes have halved. The output of tobacco products (in items) within the EU fell by 34.2% between 2015 and 2025. More strikingly, the production value plummeted by 61.9%, from €16.1 billion to €6.1 billion. This decline outpaces the fall in export volumes, indicating that domestic consumption is falling even faster and that production is increasingly geared towards export (Market Structure).
Production and export leadership have shifted geographically within the EU. While Germany remains a top exporter, its export value fell by 60.5% from 2015 to 2025. Conversely, Poland dramatically increased its export value by 214%, becoming the EU's largest exporter by value in 2025. Similarly, Lithuania saw explosive growth of 426%, becoming a major hub. This indicates a consolidation of manufacturing and export activity in Central and Eastern Europe (General Overview).
Poland and the Baltic states have become the most specialized producers. Using the Revealed Symmetric Comparative Advantage (RSCA) index for 2025, Lithuania, Portugal, and Poland show the highest specialization in tobacco product exports. Poland stands out, with over 37.8% of its total exports in this sector coming from CN 2402 products. In contrast, major economies like France, Denmark, and Sweden exhibit very low or negative specialization, reflecting different economic structures or stricter domestic health policies (Market Structure).

Conclusion

The EU tobacco products market over the last decade has undergone a strategic reconfiguration. The overarching trend is one of value over volume: EU firms are exporting fewer cigarettes but earning more per unit, while EU production capacity has contracted significantly. The trade map has been redrawn by Brexit, which eliminated the UK as a major intra-EU supply source and accelerated a pivot towards suppliers in the Western Balkans and Turkey. Internally, production and export leadership have shifted decisively to Poland and Lithuania, highlighting a geographical consolidation of the industry. These dynamics—premiumization, regional supply chain shifts, and production consolidation—paint a picture of a mature, consolidating industry adapting to a changing regulatory and geopolitical landscape.