June 2026: The Structural Shift in the UK Cigar Market: The Rise of the Cigarillo Segment
The UK cigar category accounts for more than £350 million in annual retail sales. Within this category, a significant structural realignment has occurred. First introduced six years ago, the cigarillo segment has expanded rapidly to become the largest sub-category by volume and value. The modern UK cigarillo market is heavily driven by the launch of compact, menthol- and peppermint-flavored capsule products. This flavor profile and format architecture allowed the segment to secure a permanent footprint in the wider tobacco landscape.
| Segment Type | Annual Value | Market Share Context |
| Cigarillos | £178 million | Captures more than 50% of total category volume |
| Traditional Formats (Miniature, Small, Medium / Large) | £170.3 million | Historically dominant, now the secondary value block |
| Hand-Made Cigars | £2.2 million | Niche premium artisanal segment |
Currently, broader economic factors are accelerating consumer migration into this segment. As macroeconomic pressures on smokers mount, purchasing habits are shifting toward high-value alternatives. In this environment, 17-pack cigarillos sold under £10 offer a compelling alternative to 20-pack factory-made cigarettes that are frequently sold above £15. This pricing discrepancy has allowed cigarillos to absorb price-sensitive consumers looking to reduce their total cash outlay per transaction without leaving the tobacco category entirely.
May 2026: Japan Tobacco Expands UK Cigarillo Portfolio with Benson & Hedges Leaf Wrapped
Japan Tobacco (JT) has expanded further into the growing UK cigarillo category with the launch of Benson & Hedges Leaf Wrapped, the company’s first cigarillo product under the Benson & Hedges brand. The new product, available exclusively in England and Wales, is wrapped in a tobacco leaf and features a full-flavour Virginia blend aimed at adult smokers seeking lower-priced alternatives.
The launch reflects continued momentum in the UK cigarillo segment, which has remained one of the few combustible tobacco categories delivering sustained growth in recent years. Rising price sensitivity among consumers has increasingly supported demand for lower-cost tobacco products, particularly within the cigarillo category.
Benson & Hedges Leaf Wrapped is positioned at the ultra-low-price end of the market, with a recommended retail price of £6.95 for a 10-pack. The product is priced below all conventional cigarette and rolling tobacco products currently available in the UK market, making it the company’s lowest-priced conventional tobacco offering to date.
The company is also leveraging the scale of the Benson & Hedges franchise, which remains one of the UK’s leading cigarette brands by volume share. JT currently holds a dominant position within the overall cigarillo category, with a reported 91.1% market share led by Sterling Dual Leaf Wrapped. The company’s strong performance in the segment has been supported by a series of successful cigarillo launches in recent years.
Unlike Sterling Dual Leaf Wrapped, Benson & Hedges Leaf Wrapped does not feature a characterising flavour, marking the first non-flavoured cigarillo launch from JT. The product is also positioned at a lower price point than Sterling Dual Leaf Wrapped, broadening JT’s presence within the value-focused cigarillo segment.
The launch is expected to strengthen competition within the low-price combustible tobacco category while providing independent retailers with another value-focused option aimed at price-conscious adult smokers. The product became available in wholesale depots from May 18, 2026 and is being supported through trade marketing campaigns, point-of-sale materials, wholesale promotions, and depot activations.
March 2026: UK Cigar Market Shows Modest Growth Amid Shift Toward Value Segments
The latest Circana retail data indicates that the UK cigar market is worth just over £328 million in annual sales, representing value growth of 1.4% compared with the same period last year. The largest segment by value is cigarillos, accounting for £158.1 million in sales, followed by the miniature segment (£93 million), the small segment (£52 million), and the medium/large segment (£23 million). Handmade cigars make up a relatively small portion of the market at around £2.2 million.
In recent years, the cost-of-living environment has influenced purchasing behaviour across the category, with value brands and smaller pack sizes often seeing stronger demand. Price sensitivity remains an important factor, and value positioning continues to play a significant role in consumer purchasing decisions among adult smokers.
Cigarillos have been the most dynamic segment within the category. The segment has grown rapidly over the past several years, particularly with the introduction of smaller, flavoured cigarillos, and now accounts for more than half of all cigars sold in volume terms. Improved distribution and increased availability have supported segment growth in recent years.
More broadly, the UK cigar market remains relatively concentrated, with a small number of leading brands accounting for the majority of sales. As a result, product assortment strategies in retail tend to focus on the highest-volume products across the main cigar segments, while offering a range of price points to cater to different consumer preferences.
February 2026: Annual cigar sales reach £328 million in the UK
UK cigar sales reached just over £328 million in the latest 12-month period, representing value growth of 1.3% year on year. While the overall category remains relatively stable, performance varies across segments. Cigarillos are the largest and most dynamic segment, generating £157.4 million in annual sales. They are followed by miniature cigars (£93.2 million), small cigars (£52.2 million) and medium/large cigars (£23.2 million). Handmade cigars account for £2.2 million. Cigarillos have emerged as the category’s clear growth driver. The segment gained traction around six years ago with the introduction of smaller flavoured formats, including peppermint variants. Since then, sales have expanded significantly, and cigarillos now represent more than half of total cigar volumes sold in the UK.
Price positioning appears to be a central factor behind this momentum. In the current UK market, a standard pack of 20 factory-made cigarettes typically retails between £13 and £18, depending on brand and retailer. By comparison, many packs of cigarillos are priced at around £10. This visible price gap lowers the upfront purchase cost for adult consumers and may help explain the segment’s resilience and expansion. With cigarette excise duties continuing to increase, the relative affordability of cigarillos could remain an important driver of demand. If the pricing differential persists, cigarillos are likely to continue attracting price-sensitive adult smokers and supporting incremental growth within the broader tobacco category.
November 2025: Annual cigar sales reach £327 million in the UK
Total cigar category sales reached £327 million in the UK, representing a year-on-year value growth of 2.6%. Following a rapid growth over the last five years, cigarillos now represent 47% of the category value (£154 million). Most recently, the cigarillo segment grosses £14 million per month at the retail and Japan Tobacco’s Sterling brand leads the segment with a whopping 92.8% share. Three other segments, miniature, small and medium/large cigars, account for £171 million. Hand-made cigars gross £2 million in retail revenue.
July 2025: Scandinavian Tobacco announced the launch of 17-pack Signature Action
Scandinavian Tobacco Group (STG) announced the expansion of its Signature Action menthol capsule range with the introduction of a new 17-pack format which will be available from August 2025 onwards. The new format complements the existing two 10-pack offerings and will be sold at RRP of £9.89. The 17-pack Signature Action will position the brand as the most competitively priced cigarillo in the market. Earlier in 2025, STG launched Signature Action Mix cigarillos, which contain two capsules with Berry and Mint flavours.
July 2025: Annual cigar sales reach £326 million in the UK
Total cigar category sales reached £326 million in the UK, representing a year-on-year value growth of 3.6%. Of the four cigar segments, cigarillos now represent more than 57% of the category volume and 46% of the category value (£151 milion) following a rapid growth over the last five years.
July 2025: Japan Tobacco launches Sterling Dual Capsule Xtra Yellow
Japan Tobacco (JT) launched Sterling Dual Capsule Xtra Yellow that features a double capsule of lemon and peppermint flavors in the filter. Users can crash the capsule to release a lemon flavour, in addition to the existing peppermint capsule – providing more flavour options. JT hopes to capitalize on the proven success of the lemon flavour in other categories, including flavoured vapes where lemon ranks as the third most popular flavour. Sterling Dual Capsule Xtra Yellow follows Sterling Dual Double Capsule Berrymint product, which features peppermint and berry flavour capsules, and will be retailed at £6.95 (RRP) for a pack of 10.
Cigarillo category is experiencing a strong growth in the UK and now grosses £14 million per month in retail sales. Sterling Dual Leaf Wrapped leads the UK cigarillo market with a 93.6% share.
February 2025: Cigars grossed £323 million in annual sales in the UK in 2024
The UK cigar market grew by +9.9% in 2024 to reach £323 million in annual sales in 2024. The cigar category is split into four segments: cigarillos, mini cigars, small cigars and medium & large cigars. Cigarillos are the fastest growing segment within cigars and now account for 56% of all cigars sold. In 2024, cigarillos grossed £144 million in annual sales, up from virtually zero before the Covid-19 pandemic. More recently, Scandinavian Tobacco Group (STG) extended its Signature cigarillos range, worth £6 million in annual sales, with the introduction of Signature Action Mix cigarillos that contain Berry and Mint flavour capsules. The 10-packs Signature Action Mix retail at £5.85. STG states that the sales of Signature Action family is growing by over 50% year-on-year basis in the UK.
In the mini cigars segment, STG’s Signature Blue brand emerged as the best-selling “traditional” cigar. The medium and large cigar segments are also growing, albeit at a modest rate. Altough price is an important factor also in the cigar market, cigar smokers have more tendecy (vis-a-vis cigarette smokers) to trade-up to more premium (larger format) cigars. STG’s Henri Wintermans Half Corona brand remains to be by far the UK’s best-selling medium/large cigar and a popular birthday gift for men.
