In general, competition among suppliers of leaf tobacco is based on the ability to meet customer specifications in the growing, purchasing, processing, and financing of tobacco, and on the prices charged for products and services.
Competition varies depending on the market or country involved.
Also, the number of competitors varies from country to country, but there is competition in most areas to buy and sell available tobacco.
Universal Corporation is a global business-to-business supplier of agricultural products to consumer product manufacturers, operating in more than 30 countries on five continents, sourcing and processing tobacco leaves and plant-based ingredients.
Tobacco has been its primary focus since its founding in 1918, and it is the world’s largest supplier of leaf tobacco.
Now, Universal Corporation’s main competitor is Pyxus International. Both companies compete in many countries.
However, Universal Corporation is the world’s sole supplier of leaf tobacco to Hungary, Italy, Mexico, Mozambique, the Philippines and Poland.
It also has reconstituted tobacco leaf facilities and operations that handle air-cured dark tobacco.
This company considers itself and Pyxus to be the only global suppliers of sheets, based on their worldwide scope of operations.
Most of its largest customers are partially vertically integrated and therefore also compete with Universal Corporation for the purchase of leaf tobacco in several major markets.
Industry data shows that over the past three years, total global cigarette consumption fell at a compound annual rate of about 1 percent.
Universal Corporation believes that the growth in global cigarette consumption peaked several years ago and is slowing.
As a result, the company expects short-term global demand for leaf tobacco to continue to decline slowly in line with the decline in global cigarette consumption.
In most of the major leaf tobacco markets, smaller competitors are very active. These competitors typically have lower overall requirements and provide less support to customers and farmers.