[Intl-tobacco] Korea: First private cigarette brand to d ebut soon (fwd)

[Robert Weissman]

 First private cigarette brand to debut soon  

by Kim Ji-hyun / Staff reporter / jemmie@koreaherald.co.kr
Source: Korea Herald, Thursday, 7/12/01

Following the liberalization of the tobacco industry from July 1, Korea's
first privately manufactured tobacco is to make its debut this month, the
Yonhap News Agency reported yesterday.

According to the report, a venture company named Kugang Mulsan will
introduce a new cigarette called "if" in the middle of this month. The
company will sell the new product for 2,000 won per pack through a
distribution network it has built across the nation.

The company claimed that it has drastically lowered the amount of harmful
contents, such as nicotine and tar, through a biochemical fermentation
process it has developed.

While existing cigarette manufacturing processes use chemicals to process
tobacco leaves, the company uses a mixture of water and alcohol to change
the properties of the toxic materials, according to Yonhap.

The company obtained a Korean patent for its technology in February this
year and has also applied for patents in 98 other countries.

Yonhap quoted the company as claiming that a test by the Korea Institute
of Industrial Technology Evaluation and Planning showed that its new
cigarettes contained far less nicotine and tar than existing products.
Furthermore, Kugang's cigarettes are less sensitive to changes in
temperature or moisture, meaning that they can be preserved for a longer
period of time.

Despite the low nicotine and tar contents, the new product retains the
same 'cigarette' taste, while its smoke smells much better, according to
the company.

Kugang Mulsan has outsourced the production of the new cigarette to a
plant in Kunming of China, the world's largest tobacco plant, and plans to
bring the product into Korea under an OEM (original equipment
manufacturer) contract with a Chinese firm.

Yonhap said that the company wanted to produce its new cigarettes in
Korea, but could not because the revised law requires that tobacco
manufacturers be capitalized at more than 30 billion won and set up a
plant capable of churning out more than five billion cigarettes a year.

"I had to give up producing tobacco in Korea, though my company has
developed an excellent production technology," Joo Mi-wha, company
president, was quoted as saying. Kugang plans to sell 10 billion won worth
of cigarettes this year and take up 10 percent of the domestic market by
2003.