Tobacco Industry News

National

FTC pulls endorsement for ‘low-tar’ cigarettes test
The U.S. Federal Trade Commission recently withdrew its approval of a flawed testing method that was used for over 40 years to determine the tar and nicotine content of cigarettes. The Cambridge Filter Method, also known as the “FTC Method” of cigarette testing, was originally intended to inform consumers’ decisions to choose “healthier” light cigarettes. After decades of “light” cigarette marketing based on this testing method, the FTC has announced that the test does not provide sufficient information to allow tobacco companies to make definitive claims about cigarettes’ nicotine and tar yields. This withdrawal of FTC endorsement will remove the basis for tobacco companies’ advertising claims about tar and nicotine content. If Congress votes to give the FDA regulatory power over tobacco products, tobacco companies will be required to support their advertising claims with scientific evidence, which would further reduce deceptive marketing practices. FDA regulation would also allow government agencies to track and regulate cigarette ingredients. Click here to read more. Click here to read a statement from the FTC on the decision, and click here for a related statement from the Campaign for Tobacco-Free Kids.

Goldman cuts US tobacco sector to neutral
Investment banking and securities firm Goldman Sachs has downgraded its rating for the tobacco industry from “attractive” to “neutral.” The change is a product of the overall declining economic climate, along with rising unemployment and a probable increase of the Federal cigarette tax in the near future. If the Federal tax were to increase by 61 cents, a Goldman Sachs analyst predicts a 7% decline in volume throughout the tobacco industry. The analyst anticipates that profits on smokeless tobacco and premium cigarette brands will remain relatively consistent because of considerable marketing investments for these products. For more details, click here.

Farmworkers union steps up RJR push
An Ohio-based union, the Farm Labor Organizing Committee, (FLOC), is pressuring R.J. Reynolds (RJR) to enable tobacco farm workers to unionize. Although the company does not directly employ farm workers, the FLOC suggests that RJR could exert influence on farming practices by requiring its contracted tobacco growers to bring in workers with a legal visa program and offer appropriate housing and benefits. Tobacco workers are at risk for harmful health effects through their intensive exposure to the nicotine in tobacco plants. According to Baldemar Velasquez, the FLOC president, who spent several weeks working and living with migrant tobacco workers to gather information for the unionization campaign, "If anybody in the country needs a union, it's these workers." A similar FLOC unionization campaign with a five-year boycott led to the unionization of 8,000 Mount Olive Pickle Company workers, and the FLOC has taken on Campbell Soup, Heinz and Vlasic to negotiate for workers’ rights. If RJR board members do not agree to meet with union supporters, the FLOC is expected to launch a similar boycott. Click here for more information.

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