Philip Morris invests a further 232 million dollars in Zyn production in the USA

Recently in July Philip Morris announced a 600 million dollar investment for nicotine pouch production in the USA. As announced by the tobacco company this week, a further 232 million US dollars are now to be invested in the expansion of existing production in Kentucky. You can read about the outlook for future production capacity in Owensboro and how exactly the company intends to meet the rising demand this year here.

Zyn nicotine pouches are more in demand than ever in the USA

Snus without tobacco, and Zyn Nicotine Pouches in particular, are currently literally on everyone's lips - at least in the USA, the smoke-free alternative has already experienced an upswing, which the manufacturer Swedish Match, a subsidiary of Philip Morris International (PMI) since 2022, seems to be struggling to keep up with. This is because, as Reuters reports, growth in Zyn shipments slowed to 54% in the second quarter, "as demand for the product caused short-term supply chain constraints and impacted volume growth."

There are plans to expand production - a 600 million US dollar investment for a new production site in Colorado was also announced in July. However, as the new site is not expected to be able to start regular operations until 2026, the expansion of the existing plant in Owensboro, Kentucky, is now considered essential - and a further USD 232 million is now to be invested in this.

In the short and medium term, PMI expects the planned measures to achieve the capacity required to adequately meet the current growth rate.

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Cyn production in Kentucky to be gradually increased

Construction work for the expansion of the plant in Kentucky is already in full swing. According to the tobacco company, it is expected that production can be gradually increased during the project, which is scheduled for completion in the second quarter of 2025. In addition to plant expansions, ongoing optimization of the process in particular should allow for a gradual increase in capacity. In addition, it is planned to expand the plant's operations from the current 24 hours a day, five days a week to 24 hours a day, seven days a week from the fourth quarter of 2024.

Zyn production is therefore set to increase significantly this year with various measures and PMI's scaling target is that the ongoing expansion of the plant in Kentucky will reach a capacity of around 900 million cans by 2025.

Expansion of production capacity will increase workforce by 40 percent

At the announcement on Tuesday, Kentucky Governor Andy Beshear pointed out that PMI is also creating important jobs in the region with such a scaling project. Stacey Kennedy, CEO of PMI's US business, added to this:

"This investment in U.S. manufacturing capacity will increase the Kentucky plant's workforce by about 40 percent, providing good-paying jobs and helping to meet the increasing demand for smoke-free products."

>> Read also: Tobacco Directive in the new EU Commission: The future for Snus and nicotine pouches