Jilin Tobacco Industry Explores Russian Market Potential

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The Vape Club Show Moscow, an e-cigarette exhibition, was held at the Crocus Expo center on June 17th and 18th. As the official media partner for the event, 2FIRSTS provided live coverage of the exhibition.

At the exhibition, 2FIRSTS had a exchange with Jilin Tobacco Industry. Representatives of the company stated that they displayed a total of over ten different specifications of mixed cigarettes, non-combustible pod devices, and hookah products at the exhibition.

We are confident in our ability to expand into the Russian market.

A company representative has pointed out that there is great potential in the Russian market and that this presents a rare opportunity for the Jilin Tobacco Industry, perhaps a once-in-a-century chance.

From a historical perspective, the development of the Jilin Tobacco Industry in the Russian market is long-standing. The company's predecessor, Yanji Cigarette Factory, established a local factory in Vladivostok as early as 1991. However, due to changes in history, political environment, operational conditions, and other factors, the company later withdrew from the Russian market.

Secondly, from a geographical perspective, Jilin Province and the Far Eastern region of Russia are adjacent and possess unique geographical advantages. Thirdly, in terms of the broader context, the relationship between China and Russia is at an unprecedented stage of high-level development, providing a favorable environment for trade in various fields between the two countries. From a national policy perspective, the Northeast region is an important area for government support with favorable policies.

In addition, products from Jilin Tobacco Industry possess unique technological advantages, with patents and technologies in categories such as blended cigarettes, heated non-combustible pods, and hookah. Therefore, considering the international situation and their own strengths, the company has enough confidence to expand into the Russian market.

According to a representative of the company, Jilin Tobacco Industry has extensive experience in expanding in overseas markets. Since 2000, the company has built three local factories in North Korea. Before withdrawing from North Korea due to United Nations sanctions in 2017, Jilin Tobacco Industry's annual cigarette production and sales volume reached one million units, making it one of the top five overseas production and sales bases for Chinese tobacco and the largest foreign production and sales base.

Currently, the company's overseas business reaches Southeast Asia and the South Korean market. In the future, it plans to expand to regions such as the Middle East and Russia, which have both demand and potential.

In collaboration with e-cigarette brand HQD

Representatives stated that when discussing the company's future plans for the Russian market, it is currently in collaboration with HQD, the largest e-cigarette brand in the Russian market. Utilizing HQD's strong local sales network, the company plans to launch a pod product in the third quarter of this year, which will be a joint collaboration between HQD and Changbaishan, a cigarette brand owned by Jilin Tobacco Industry. After receiving enough market traction and feedback, the company plans to promote other tobacco products such as hookah and hybrid cigarettes.

The company representative believes that there are some challenges and potential difficulties in the future development of the Russian market.

There are several reasons why expanding into the Russian tobacco market may be challenging for China. First, there are differences in the two countries' economic situations and Russia's market has issues with regulation that will require adaptation to local standards and rules. Second, the current international environment is unstable and the United States and its Western allies have imposed sanctions on Russia, making for an unfriendly global climate. Third, due to these sanctions and other factors, financial transactions may pose a risk. Fourth, differing regulatory systems in the tobacco industry between China and Russia could cause potential problems in cross-border trade and misunderstandings, creating further uncertainty.

A company representative stated that they have full confidence in the Russian market and, based on their experience of setting up factories overseas and the support of both countries' policies, they may invest in Russia and establish local factories in order to achieve greater development in the future.