Reconstituted Tobacco’s Growing Popularity in China

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By TobaccoChina Online

Reconstituted tobacco leaf (RTL) has been widely used in cigarette blends both at home in China and abroad. The Chinese tobacco industry began to develop RTL in the late 1990s and gradually applied it in cigarettes. At present, the proportion of RTL in Chinese cigarettes is less than the international average. with its average use is about 4.5% in first-class cigarettes 5% for second-class, and 6% for third, fourth, and fifth-class. According to the calculation of 2018 cigarette classification data, the overall use ratio of RTL in Chinese cigarettes is about 5.42%. In comparison, the world’s largest cigarette brands’ average blending proportion of RTL has exceeded 20%, while its use in America has reached 30-35%.

RTL overcapacity expected to increase

The amount of RTL used is related to cigarette sales, unit weight of cigarette, and blending ratio of RTL. According to the average usage proportion of RTL at 5.42% with each cigarette calculated as weighing 0.9g, the consumption in 2019 was 115,500 tons. Fourteen RTL production enterprises have been set up in China, of which China Tobacco Schweitzer (Yunnan) Reconstituted Tobacco (CTS) boasts the largest production capacity. The annual production capacity of the above 14 enterprises is 165,000 tons, while the annual demand is about 110,000-130,000 tons. Therefore, RTL production is currently in overcapacity.

The State Tobacco Monopoly Administration (STMA) in 2004 stipulated that the pack-marked tar limit of more than 15 mg/cigarette produced by enterprises should not be allowed to come into the sales market. In 2014 STMA issued a notice, requiring an acceleration in the promotion and application of technical achievements used to reduce harmful components in cigarette smoke, leading to a reduced pack-marked tar limit in cigarettes to 10mg/cigarette in 2015. Also, in 2012 the agency launched a major program to upgrade the technology of paper-making with RTL, requiring further improvements in the quality stability, functionality, and formula practicability of RTL products. With these efforts in reducing harmful components in cigarette smoke, the capacity scale, product quality, and blending ratio of the paper-making process, RTL in China is expected to achieve further growth in the future.

Production of RTL as tobacco monopoly product

The supply of domestic tobacco raw materials and the production and sale of tobacco monopoly products are strictly controlled. In the RTL supply chain, China National Tobacco Corporation (CNTC) is the only supplier of upstream raw materials and the only user of downstream products. Private enterprises with permission can only participate in the midstream manufacturing link.

CNTC sets production targets and provides raw materials for RTL production and processing enterprises. The main raw materials used are tobacco waste, including the root tips and fines produced in the process of threshing and re-drying and the waste cut tobacco and fines produced by the production of cigarette industry enterprises. Both the threshing and re-drying and cigarette production are businesses of industrial enterprises under CNTC.

At present, RTL production enterprises can be divided into two categories. The first category is those built by CNTC; the second category is the joint ones funded by CNTC and a third party which may either provide technical support or participate in the production when obtaining RTL production qualification from STMA. The “third party” in the second category of production enterprises can be private enterprises. In the RTL manufacturing process in China, Huabao International Holdings plays an important role. Guangdong Jinye Technology Development, a wholly-owned subsidiary of Huabao International, is mainly responsible for the RTL business. As the research and development base of RTL paper-making process of STMA, Guangdong Jinye has a capacity of about 30,000 tons, providing engineering and technical support to seven other RTL production enterprises, as well as building joint laboratories with tobacco companies in such provinces as Guangdong, Yunnan, Jiangxi, Hunan, and the municipality of Shanghai.

The industrial corporations under CNTC are the only RTL users in China. The RTL products processed and produced by these enterprises and the remaining raw material waste would be recycled by CNTC.

HNB-dedicated RTL

New tobacco products have become hot items in the industry. What is unclear now is the domestic policy for HNB products, but what is clear is they fall into tobacco products led by CNTC and that they will be the main new tobacco products in the future. The production technology of HNB-dedicated RTL is the optimization and transformation of traditional RTL production technology based on the demand for HNB.

CNTC actively lay out new tobacco fields and accelerated technology r&d. As of March 24, 2020, there have been 852 open patents for HNB and 56 patents for HNB-dedicated RTL, which are mainly owned by CNTC. China Tobacco Chongqing Industrial ranks first with 20 patent applications. The number of patent applications respectively for China Tobacco Henan, China Tobacco Guangdong (jointly applied with Guangdong Jinye), China Tobacco Yunnan, and China Tobacco Hubei are seven, four, three, and three.

Most patents are related to the preparation method, accounting for 87.50%, while patents related to equipment account for 12.50%. Among the patents related to equipment, two patents are related to the “extraction and separation” process, two to the “cutting” process, two to the “drying” process, and one to the “coil materials”.

At present, there are four kinds of production processes for HNB-dedicated RTL –that is, paper making process, dry paper making process, slurry process, and pressure-rolling process. Among them, the application of paper-making RTL in HNB products is the research hotspot in recent years. The production technology of paper-making process for RTL, developed by Schweitzer-Mauduit (SWM), the largest and oldest RTL production enterprise in the world since the 1950s, has been applied in the tobacco industry since the 1960s, leading its global consumption to increase year by year.

In August 2014, CTS, with China Tobacco and SWM respectively controlling its 50% equity, officially came into production, bringing to China the international advanced processing technology and equipment for RTL. CTS adopts the advanced “two-step papermaking process” technology provided by SWM for the production of RTL.

Based on the traditional process, today’s production process of paper-making process for RTL is developed and integrated with key processes such as special sheet preparation process, liquid coating (including smoking agent), coating process, winding process, and tobacco-cutting process. The advantage of the paper-making method is that it has a high control performance over the coating liquid and sheet, a double shaping of the form, and the internal quality. In addition, the amount of binder is less. Its disadvantage is subject to the coating rate, the content of the effective load dry matter is lower than that of the slurry process and the pressing-rolling process, so the smoking amount and the aroma amount are slightly lower. Moreover, the smoking agent is mainly coated on the surface of the RTL, which is easy to leach and absorb moisture.