HS Code:
Water pipe tobacco, specified in subheading note 1 to Chapter 24 of the Harmonized System (HS Code: 2403.11), refers to tobacco intended for smoking in a water pipe, commonly known as shisha or hookah. This product category includes flavored and unflavored tobacco mixtures specifically prepared for use in water pipes, often mixed with molasses or honey. It is distinct from other forms of tobacco due to its unique preparation and cultural usage, predominantly in the Middle East, South Asia, and parts of Africa. Global trade in water pipe tobacco has grown due to increasing demand in both traditional and emerging markets, driven by cultural practices and the rising popularity of hookah lounges in Western countries.
Total Trade Volume
Approximately $1.2 billion USD
Data from 2022
Source
United Nations Comtrade Database and International Trade Centre (ITC)
$320 million USD
26.7% of total trade of total trade
Increasing
$250 million USD
20.8% of total trade of total trade
Stable
$180 million USD
15.0% of total trade of total trade
Increasing
$150 million USD
12.5% of total trade of total trade
Stable
$100 million USD
8.3% of total trade of total trade
Increasing
Average Rate
15% ad valorem
Highest Rate
35% (applied by certain South Asian countries)
Lowest Rate
0% (under free trade agreements in GCC countries)
Rising demand in Western markets
Increased exports to North America and Europe due to the popularity of hookah bars and cultural diversity
2020-2022
Shift towards flavored tobacco
Growing preference for fruit and dessert-flavored water pipe tobacco, driving product innovation and market segmentation
2019-2022
Regulatory tightening
Stricter health regulations and tobacco control measures in several countries are limiting market growth in specific regions
2021-2023
The European Union updated its Tobacco Products Directive to include stricter regulations on water pipe tobacco, mandating detailed health warnings and limiting certain flavorings.
May 2023
Potential reduction in flavored tobacco imports to EU countries, prompting exporters to adapt product offerings.
Gulf Cooperation Council (GCC) countries harmonized excise taxes on tobacco products, including water pipe tobacco, to curb consumption while maintaining free trade within the bloc.
January 2023
Stabilization of trade flows within GCC, but higher costs for consumers may slightly dampen demand.
The US Food and Drug Administration announced plans to restrict the sale of flavored hookah tobacco as part of broader tobacco control measures.
September 2022
Possible decline in US imports of flavored water pipe tobacco, pushing manufacturers to explore alternative markets.