Technical Bulletin No. 587 H^ ^'^^^^T;^ ^^ November 1937 UNITED STATES DEPARTMENT OF AGRICULTURE WASHINGTON, D. C. CONSUMPTION AND PRODUCTION OF TOBACCO IN EUROPE By J. B. HuTsoN ^ CONTENTS Page Introduction 1 Development in the European tobacco industry Changes in the European consumption of by countries—Continued. tobacco, 1913-32, and their causes 2 Sweden ... 47 Types of tobacco used in Europe. 3 Denmark 60 Uses of United States tobacco in Europe 5 Austria 64 Consumer preferences by regions 7 Portugal 66 Changes in the consumption of tobacco Finland : 68 products _ - - 8 Latvia, Lithuania, and E stonia 60 Consumption per capita 10 Belgium 63 Kelation of prices of tobacco products to con- France 68 sumption - 12 Germany 73 Trade restrictions and their effects on con- Czechoslovakia 80 sumption 19 Poland 83 Production and classification of European leaf Spain 88 tobacco - 21 Switzerland .___ 90 Location and description of types 21 Italy 92 Development in the European tobacco industry Rumania 96 by countries 33 Yugoslavia. 100 United Kingdom. 33 Hungary 103 Netherlands . 40 Bulgaria, Greece, and Turkey. _ 107 Norway 44 Total imports of leaf tobacco into Europe 113 INTRODUCTION For a few years immediately following the close of the World War nearly one-half of the tobacco grown in the United States was con- sumed in foreign countries. Production was increased in several for- eign countries and by 1924 foreign consumption of tobacco imported from the United States had begun to decline. However, European consumption of several important United States types is still greater than that of the same types in this country. Consequently develop- ments in Europe are significant when the demand for our domestic tobacco is considered. After the World War, marked changes took place in the consump- tion of tobacco products. There was an increase in the use of cigar- ettes and a decline in the use of cigars, chewing tobacco, and snuff. Many of the several types of tobacco used in each of these products are imported from the United States. Thus, there were changes in demand for the various types of tobacco imported from the United States. Trade restrictions of various kinds, including monopoly-control measures, also affected consumption of tobacco from this country. 1 Mr. Hutson, now assistant administrator, Agricultural Adjustment Administration, began this study while serving as tobacco specialist, Bureau of Agricultural Economics. Credit is due Louise Moore Coleman for assistance in compiling the data included herein and for suggestions and revisions in the text. Credit is also due Hortense Kreulls for assistance in translating and compiling data from original sources. 2 TECHNICAL BULLETIN 587, U. S. DEPT. OF AGRICULTURE During the period 1913-29 there was a marked increase in the use of United States flue-cured types in Europe, but this was partly offset by declines in the use of air-cured and fire-cured types. The increased consumption of flue-cured types was due chiefly to the increased use of cigarettes particularly in the United Kingdoin. The decline in the use of other types was due partly to the decline in consimiption of the particular products in which such types were used and partly to the substitution of European tobacco and European colonial tobacco in many blends. For the same reasons, there were declines in the use of practically all United States types during the period 1930-32. In fact, the decline in consumption of products, and the substitution of foreign tobaccos, continued to such an extent that the total Euro- pean consumption of United States leaf tobacco in 1932 was slightly less than pre-war quantities. Changes that took place from 1913 to 1932 in the consumption of leaf tobacco and tobacco products are shown in this bulletin and attention is directed to the more significant causes. Consumer prefer- ences, prices, and trade restrictions loom large. The types of tobacco grown in Europe are described, the producing areas are located, and the approximate production of each type is indicated. Cases in which production has been influenced by trade restrictions or other forms of Government influence are noted. The changes that have taken place in each country in the production of leaf tobacco, in the con- sumption and prices of tobacco products, and in the origin of import leaf, are traced. CHANGES IN THE EUROPEAN CONSUMPTION OF TOBACCO, 1913-32, AND THEIR CAUSES Developments leading to changes in the European consumption of tobacco during the period 1913-32 were of such a nature as to make it advisable to divide the period into four parts: The war period, 1913-20; the early reconstruction period, 1921-24; the later recon- struction period, 1925-29; and the depression period, 1930-32. Statistics are not available as to the quantities of the different tobacco types used in European countries. Inaport statistics of the various countries do not always reflect the true situation, owing to the failure of some important trading countries to list their reexports.^ This is particularly true of Germany and Belgium, and Germany has one of the largest reexport markets m Europe. The determination of European tobacco consumption is further complicated by the fact that many countries do not report tobacco stocks.^ Moreover, consumption of tobacco does not change in the same way as do imports. Large stocks of tobacco are usually held by manufacturers to permit the leaf to age from 1 to 3 years or more before it is used. New supplies are usually bought at about the > Tobacco exported to continental Europe for the most part enters through the free ports, Bremen and Trieste, or through Antwerp, Amsterdam, and Rotterdam. A large part of that exported from the United States to continental Europe is distributed through these points. Exports to the free ports are reported in the statistics of the exporting country as shipments to the countries in which the ports are located, but only that part of such consignments actually taken into the customs boundaries is recorded as imports. Ihe remamder is reexported and as the exports of foreign tobacco are not disclosed in the German and Belgium export statistics, the ultimate destination of tobacco thus passing through Bremen and Antwerp is lost or confused. With the exception of oriental types intended for use in the united States, tobacco consigned to Trieste is mostly consumed in Italy. The trade of Amsterdam and Rotterdam öfters no great problem as all tobacco sold on the Netherlands international market is listed by type and country of ultimate destination. s Official reports are issued in the United Kingdom showing total stocks and Empire tobacco stocks at the Qnd of each month. OONSUMPTIOK AND PRODUCTION OF TOBACCO IN EUROPE 3 same rate that old stocks are used up, though in periods of increasing consumption imports exceed manufactures, and in periods of declining consumption imports fall below manufactures. Such trade and stocks statistics as are available for the different countries have been carefully reviewed together with statistics as to the quantities of tobacco products consumed, and the types of tobacco used in the various classes of products in each country. Based upon these factors, estimates have been made as to the annual consumption of the various types of tobacco at the beginning and end of each of the periods mentioned. Since the estimates shown in table 1 were made, some data have become available for the years 1933, 1934, and 1935. Total European consumption in 1933 was around the level of the previous year; increases in some countries were offset by declines in others. In Germany, consumption in 1933 was 5 percent greater than in the previous jrear. In France, Czechoslovakia, Poland, and Sweden, consumption was slightly less than in the previous year. In 1934, consumption increased in several countries. The most marked increase was in the United Kingdom where there was an increase of 6 percent over the previous year. Information is lacking for several countries, but it appears that the total European, consumption of tobacco in 1934 increased by a quantity equal to between one-fourth and one-half of the losses during the 1930-32 period. TABLE 1.—Estimated consumption of leaf tobacco in European factories by typeœ- source^ specified years ' Type or source 1913 1920 1924 1929 1932 Million Million Million Million Million United States: pounds pounds pounds pounds pounds Flue-cured 140.0 210.0 177 0 Fire-cured _ (2) S 170.0 100.0 84 0 Dark air-cured ' 28.0 17.0 13 0 Burley-__ _ _. 7.0 7.0 8 0 Maryland (2) 15.0 13.0 8 0 Stems and trimmings (2) (2) 20.0 3.0 10 0 Total _...-... 320.0 400.0 380.0 350.0 300 0 Oriental 125.0 115.0 190.0 260.0 205 0 Semioriental . 37.0 37.0 46.0 75.0 83 0 European dark... 200.0 145.0 162.0 210.0 235 0 British colonial-.. 2.1 4.8 11.9 28.6 37 0 Algerian 11.0 20.0 22.0 32.0 26 0 Netherland East Indian _. 150.0 152.0 154.0 155.0 130 0 Brazilian and Paraguayan 60.0 60.0 65.0 55.0 50 0 Philippine 25.0 36.0 40.0 46.0 40 0 West Indian 28.0 30.0 35.0 48.0 25 0 other 4.5 6.6 7.0 7.2 3 0 Total 962.6 1,006.4 1,112. 9 1,256.8 1,134.0 1 Data relating to consumption in this table and elsewhere in the bulletin are based upon processing order.