Tobacco Asia

46 tobaccoasia MANUFACTURING NEWS 制造新闻 JTI Invests US$360M in Philippine Factory Japan Tobacco International (JTI) plans to invest PHP21 billion (US$360 million) in its Batangas manufacturing facility in the Philippines, expanding production capacity to supply 22 markets across Asia. The investment will strengthen the company's regional manufacturing operations while introduc- ing new tobacco technologies and developing workers' technical skills. The investment forms part of JTI's plans to expand the Batangas plant's capabilities. The facility will incorporate advanced manufacturing technologies to support production and meet demand across its regional markets. JTI has been retraining employees to operate the new equipment. The company began intensive training after commissioning the dry ice expanded tobacco (DIET) plant in 2025, preparing workers for the technology's introduction. The new facility brings a processing capability previously handled at overseas sites to the Philippines, expanding the technical expertise available at the plant. The Batangas investment includes PHP1.9 billion (US$33 million) for the DIET plant and more than PHP177 million (US$3 million) for the expanded controlled-atmosphere facility. Together, the projects add processing capacity and strengthen the factory's role in JTI's Asian manufacturing network. Huabao Expands Tobacco Automation Huabao International Holdings is expanding digital manufac- turing and automation across its tobacco-related operations, including the introduction of a manufacturing execution system and an artificial intelligence-powered optical sorting machine for flavor capsules. In its 2026 interim report, Huabao said it had launched the "Xin Zhizao" manufacturing execution system (MES) project for its tobacco raw-materials business. The system aims to digitize and improve management of production processes, with implementation covering planning, process reengineering, system design, user training, and the transition to live operation. The company has also put an AI optical sorting machine into operation for flavor capsules. The equipment combines machine vision, AI algorithms, and high-speed automated mechanisms to detect and sort capsules according to their appearance. Huabao said the system should improve product quality consistency and production efficiency while strengthen- ing digital quality management. The company described the technology as part of its broader effort to integrate AI into production and other business processes. The digital manufacturing push comes alongside an expansion of Huabao's tobacco raw-materials production capacity. The company said its 3,000-ton Indonesian production base is ramping up, with reconstituted tobacco leaf (RTL) for innovative tobacco products achieving batch deliveries. The production line has operated at full load since the second half of the second quarter, while product yields have continued to improve. Huabao said the Indonesian facility has increased its comprehensive capacity utilization compared with the same period last year. The company has also improved production stability and operating efficiency through technological upgrades and has begun converting multi-category products made on the same production platform into commercial orders. The company's tobacco raw-materials business generated approximately RMB199 million (US$28.8 million) in revenue during the first half of 2026, down 16.4% year over year. Huabao attributed the decline primarily to changes in domestic market demand and an ongoing adjustment of its product structure and production capacity. At the same time, Huabao is expanding its overseas manufacturing footprint. It said construction of a new factory in Cikarang, Indonesia (near Jakarta) began at the end of July, primarily to support overseas customization and new product categories. The company also said it has initiated a project for a flavor-capsule factory in Paraguay as part of its international production-capacity expansion. Its flavor-capsule business has expanded across nearly 20 countries and regions in Asia, South America and the Middle East. Huabao's r&d program continues to focus on areas including HNB materials, capsule technology, novel delivery systems, and tobacco-product materials. The company said its AI optical sorting technology represents part of its broader investment in smart manufacturing and production efficiency. Tobacco Factories Hit in Ukraine Russian drone attacks struck production facilities operated by British American Tobacco (BAT), Imperial Brands, and Japan Tobacco International (JTI) in Ukraine in September, disrupt- ing operations at three major tobacco manufacturing sites. On September 7, a drone attack caused a fire at BAT's cigarette production facility in Pryluky, Chernihiv region. BAT said its employees sheltered during the attack and that no employees suffered injuries. Ukrainian authorities reported that a local resident near a bus stop sustained injuries. BAT said it was assessing damage to its production and warehouse facilities and had temporarily suspended operations at the site. The Pryluky factory produces Kent, Lucky Strike, Pall Mall, Rothmans, Capri, and Pryluky cigarettes, as well as sticks for BAT's glo heated tobacco system. The following day, a Russian drone strike damaged production facilities and infrastructure at Imperial Brands' factory in Kyiv, forcing the company to halt operations. Imperial said no employees suffered injuries. The Kyiv facility JTI is giving its Batangas plant a US$360 million boost to expand production across Asia. Credit: JTI-AMC.

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