Global Cigar and Cigarillos Market 2025 – 2034

Reports Description

As per the Cigar and Cigarillos Market analysis conducted by the CMI team, the cigar and cigarillos market is expected to record a CAGR of 8.17% from 2025 to 2034. In 2025, the market size was USD 59.88 Billion. By 2034, the valuation is anticipated to reach USD 120.71 Billion.

Overview

A noticeable trend is the positioning of cigars as one of the luxury products associated with relaxation, sophistication, and celebration. The perception has further been amplified by influencer marketing and social media, which do showcase the cigars as aspirational indulgence. Furthermore, the increase in the middle-class population in the emerging economies, especially in LATAM and Asia-Pacific, does represent a sizable customer base with rising buying power and desire for experience-driven, high-quality products.

Expansion of specialized cigar lounges and duty-free retail also improves accessibility and makes provisions for platforms for product consumption. Also, innovation in sizes, flavors, and packaging, especially within cigarillo segment, does aim to draw new users. Manufacturers across the globe produce cigars and cigarillos at a lower cost per unit by using streamlined processes, machine rolls, and cost-effective raw materials, thereby rendering them popular and economical amongst the users.

Key Trends and Drivers

• Rising Demand from Emerging Economies

The global cigar and cigarillos market is witnessing an upsurge in demand from the emerging markets, especially in regions such as Africa, the Middle East, and Asia-Pacific. With these economies witnessing rapid urbanization, there is a rising adoption of luxury products inclusive of cigars and cigarillos. In many of the emerging economies, cigars are linked with exclusivity and status, which is catalyzing their popularity amongst the middle classes.

Increased demand for tailored and flavoured cigarillos catering to local preferences and tastes is creating lucrative opportunities for personalization and innovation. Also, a wider cultural shift is rendering cigars more integrated into social occasions as well as leisure activities, thereby raising their relevance in contemporary lifestyle settings.

• Growth of e-Commerce Vertical

The promulgation of online retail and e-Commerce platforms is helping in the transformation of distribution and sales channels for cigars and cigarillos. The consumers are now privileged to buy their preferred products and brands online, and that too at competitive prices. Plus, the online environment lets you have better accessibility to a broad spectrum of cigars and cigarillos, including specialty and rare items that may not be found readily in physical stores. The ease of online shopping along with the ability to reach a customer base at the global level is driving growth of the distribution channel and letting the manufacturers connect with customers on a direct basis.

What’s trending in the Cigar and Cigarillos Market?

The manufacturers are into the development of cigars with reduced nicotine and tar content and also options that prefer non-tobacco ingredients in the wake of the raised health consciousness quotient worldwide. Certain manufacturers are exploring the potential of heated tobacco products or electronic cigars, which do offer a smoking experience with minimal harmful chemicals. Such alternatives have been positioned such that health-conscious consumers get drawn while retaining the conventional aspects pertaining to the consumption of cigars and cigarillos.

Key Threats

Higher levels of taxation regarding tobacco products along with fluctuating price pressures are the challenges that persist in the cigar and cigarillos market. The governments are seen using tobacco taxes as a handsome source of revenue and also a means of deterring consumption for various public health reasons. Taxation policies are capable of significantly impacting the affordability of cigars, thereby potentially resulting in a shift toward black-market products or cheaper alternatives.

Besides, maintenance of consistent quality with regard to the production of cigars and cigarillos could be challenging, particularly for premium and handcrafted offerings. Variability in tobacco sourcing, production processes, and aging conditions is likely to affect flavour as well as the overall quality of the product.

Opportunities

Emphasis on developing, followed by marketing a broader variety of appealing flavors beyond conventional options to address evolving consumer tastes poses a good opportunity for the cigar and cigarillos market. The players can also use online platforms with direct-to-consumer models for reaching out to a wider customer base. They could also enter into partnership with hospitality sectors for offering integrated cigar experiences and invest in the dedicated cigar lounges for cultivating a brand community. The untapped markets of the Asia-Pacific could be explored in the near future.

Category Wise Insights

By Product

• Mass

Mass cigar and cigarillo segment accounts for over 70% of the market share. This could be credited to the growing preference for mass-category cigarillos amongst the youth. The products are machine-made in bulk quantity, which lets the market players float them at a lower cost in comparison with hand-rolled premium cigars. Also, the variety of flavors available in mass-produced cigarillos, like chocolate, mint, and vanilla do attract youngsters.

• Premium

The premium cigars are generally handcrafted using the finest tobacco (which is sourced from renowned places). They do undergo meticulous manufacturing process and excessive aging, which would result in superlative flavors, elegant smoking experience. The premium brands are witnessing a growing demand due to consumers, especially the elite ones, preferring superior craftsmanship and quality. Premium cigars are known for undergoing prolonged aging and are packed in high-end tubes or boxes at premium price.

By Flavor

• Unflavored

The unflavoured cigar and cigarillos are favoured by those who prefer nuanced natural tastes as well as aromas of tobacco. They are usually consumed within the dedicated cigar lounges/specialist tobacconists. The key trends in this sector are inclusive of a robust focus on premiumization, with rising demand for long-filler, hand-rolled cigars crafted from aged, high-quality tobaccos from Dominican Republic, Nicaragua, Cuba, etc.

• Flavored

Flavored cigar and cigarillos hold more than half of the market share. This could be owing to diverse flavoured options being made available worldwide. The manufacturers are infusing cigars and cigarillos with a spectrum of flavors, right from conventional notes such as chocolate and vanilla to the other options such as spices and fruits. For instance – Gurkha Cognac Cigars that are infused with cognac do offer a luxurious flavour experience aligning with the trend of premiumization in the market.

By Distribution Channel

• Offline

The sales of cigars and cigarillos in the offline mode account for more than 80% of the market share. The offline distribution channels comprise specialty cigar shops, brick-and-mortar retail locations, lounges, and various other physical establishments wherein the customers could personally pay a visit. Numerous cigar enthusiasts opt to taste cigars and cigarillos prior to committing to buying. The physical stores thus let customers engage in this experience, thereby ascertaining that they get satisfied with their choice.

• Online

Online platforms do provide a smooth shopping experience, thereby letting customers choose and buy cigars and cigarillos within just a few clicks. Sizable product descriptions, educational content, and customer feedback let customers make well-informed choices while selecting the cigars and cigarillos. The easy access to information thus enriches the online shopping experience, thereby helping the customers in choosing the cigars that adhere to their tastes and meet the expectations.

How are Premium Cigars shaping Cigar and Cigarillos Market?

Premium cigars, as per price range, are generally associated with sophistication, luxury, and status symbols. In other words, smoking premium cigars is looked upon as a mark of refined taste and affluence. The process of selection, cutting, and lighting of a cigar is a calming and enjoyable experience for many people. Premium cigars come in a broad range of flavour profiles, right from mild to full-bodied, and are capable of offering a nuanced and complex smoking experience. Cigars from the Dominican Republic, Cuba, Honduras, and Nicaragua have been critically acclaimed at the international level, thereby expanding the reach of the market.

How are the U.S. Tariffs affecting Cigar and Cigarillos Market?

The U.S. tariffs imposed in April 2025 are raising the price of imported cigars and cigarillos, especially from the major manufacturers such as the Dominican Republic, Nicaragua, and Honduras, thereby resulting in higher costs for consumers along with a shift in the supply chains as the companies are adjusting their strategies for mitigating losses. The players, in order to avert U.S. tariffs, may also ship their products to the other markets such as Canada and Europe, thereby potentially altering availability of some cigars in the U.S.

Report Scope

Regional Perspective

The Cigar and cigarillos market is classified into North America, Europe, Asia Pacific, and LAMEA.

• North America

The U.S. holds over 80% of North America’s cigar and cigarillos market revenue and the scenario is expected to persist even during the forecast period. This could be reasoned with the U.S. witnessing stability with respect to the regulatory environment for the cigars and cigarillos. In other words, cigars and cigarillos are subject to less stringent restrictions in the U.S. As such, a combination of economic, cultural, and regulatory factors is driving the market.

• Asia Pacific

Asia Pacific accounts for over 48% of the market share due to the rise in demand for luxury and premium products, inclusive of cigars and cigarillos. The shift toward a rise in consumption is also driven by a desire for a more sophisticated lifestyle. The economies like India and China are also witnessing a visible increase in disposable income, which is keeping the cash registers ringing for the cigar and cigarillo market in the Asia Pacific. Also, in Australia, females are preferring sweet tobacco flavors like Swisher Sweet and White Owl. Tatiana, Java, and Acid are also being tried out.

• Europe

Rising consumption of cigars and cigarillos in Russia, Sweden, and Poland is the factor basically driving the cigar and cigarillos market in Europe. Also, psychological factors such as dependency on tobacco, followed by societal perceptions of smoking being looked upon as an act to sound fashionable are raising the demand for cigars and cigarillos. Also, the market is witnessing an increase in the number of female smokers in social gatherings.

• LAMEA

Brazil is known as one of the biggest producers of tobacco worldwide. This could be credited to the state of Bahia being one amongst the first ones to cultivate tobacco at the global scale. Rise in disposable income amongst the population in UAE and Saudi Arabia basically drives the cigar and cigarillos market. Also, development of affluent consumers’ sections has driven the interest in luxury and premium tobacco products.

• Central America

Countries such as Nicaragua, the Dominican Republic, and Cuba have a rich tobacco heritage. The cultural difference, along with the growing population of the middle class, has resulted in an increased inclination toward cigars and cigarillos. Such products are usually associated with sophistication and status. Central America is a hub of the cigar and cigarillos market as far as exporting tobacco is concerned.

Key Developments

The cigar and cigarillos market is witnessing a notable organic and inorganic expansion. Some of the key developments include –

• In August 2024, Gurkha Cigar Group launched Fantasma, an exclusive cigar designed specifically for Specs – a retailer based out of Texas. The limited-edition release does feature a blend of Dominican and Nicaraguan tobaccos wrapped in an oily, dark San Andres wrapper.

• In June 2024, Scandinavian Tobacco Group (STG) inked an agreement for acquiring mac Baren Tobacco Co. from halberg for USD 76.87 Million, a transaction set to be monetized through available debt and cash. The objective of this acquisition was to enhance STG’s position in the smoking tobacco market.

• In April 2024, Gurkha Cigar Group introduced a collection of six premium cigars for the travel retail market. This collection does comprise Gurkha Beauty, Cellar Reserve Edición Especial (18 Year), Cellar Reserve (15 Year), Cellar Reserve (15 Year) 10^th Anniversary, Gurkha 35^th Anniversary, and Cellar Reserve 21 Year – all accompanied with a stainless-steel cutter.

Leading Players

The cigar and cigarillo market is highly niche. Some of the key players in the market include:

• Burger Holding AG
• British American Tobacco
• Gurkha Cigars
• JT International SA
• Imperial Brands plc (Habanos S.A.)
• Oettinger Davidoff AG
• Scandinavian Tobacco Group A/S
• Swedish Match AB
• Philip Morris International Inc.
• Swisher International Inc.
• Others

These firms apply numerous strategies to enter the market, including innovations and mergers and acquisitions, as well as collaboration. The cigar and cigarillo market is shaped by the presence of diversified players that compete based on product innovation, vertical integration, and cost efficiency.

The Cigar and Cigarillos Market is segmented as follows:

By Product

• Mass
• Premium

By Flavor

• Unflavored
• Flavored

By Distribution Channel

• Offline
• Online

Regional Coverage:

North America

• U.S.
• Canada
• Mexico
• Rest of North America

Europe

• Germany
• France
• U.K.
• Russia
• Italy
• Spain
• Netherlands
• Rest of Europe

Asia Pacific

• China
• Japan
• India
• New Zealand
• Australia
• South Korea
• Taiwan
• Rest of Asia Pacific

The Middle East and Africa

• Saudi Arabia
• UAE
• Egypt
• Kuwait
• South Africa
• Rest of the Middle East and Africa

Latin America

• Brazil
• Argentina
• Rest of Latin America