Philip Morris USA - Marlboro SNUS being made at York County, VA plant..

October 3, 2010 - In a former Philip Morris cigarette-equipment repair plant, the nation’s top tobacco company is now making something called Marlboro snus, one of the newer entries in a growing array of alternative tobacco products.

The York County (Virginia) factory itself isn’t a typical tobacco plant, either. “It is something that is new and unique and different from anything else that we have,” Ed Tucker Jr., director of smokeless tobacco manufacturing at the York plant, said yesterday during a tour of the plant. The plant operates more like a food-processing facility than a tobacco factory. Employees wear hair nets, plastic aprons and gloves. “Clean-room” rules are enforced in areas where the snus is blended, flavored and packaged. Hand sanitizer dispensers are strategically placed around the plant.

“We use pretty extreme sanitation measures to make sure everything is clean,” he said, adding that the equipment is swabbed regularly to check for microbial growth.

It could be a sign of things to come under the Food and Drug Administration’s new regulatory authority over the tobacco industry. The FDA is still developing guidelines for safe manufacturing processes for tobacco products, but the agency could require similar sanitation measures in other tobacco plants. Tucker said the company adopted the sanitation measures because it was necessary to ensure the integrity of the product.

Originally opened in 1978 as a repair plant, the York factory was later converted to manufacture the Accord, an electronic cigarette that Philip Morris test-marketed unsuccessfully in the 1990s. The company closed the plant in 2004.

The company made a $100 million investment in 2007 to convert the plant to snus production. It added 33,000 square feet to what is now a 139,000-square-foot building. It put in new equipment and added a cold-storage room where tobacco leaf is kept chilled at 40 degrees to prevent it from degrading.

In July 2010, the plant’s ownership was transferred from Philip Morris to sister company U.S. Smokeless Tobacco, which is producing snus for Philip Morris.

The moist smokeless tobacco category has been growing about 7 percent a year in the United States, as cigarette sales have declined at about 3 percent to 4 percent a year.

After test-marketing Marlboro snus in several states, Philip Morris went national with the product earlier this year, selling it mainly in packages containing six snus pouches for a retail price typically about half the cost of a pack of 20 cigarettes. The company is selling snus in four flavors: spearmint, peppermint, rich and amber (formerly mild).

“They are hoping it is going to offer them some new growth in the smokeless area,” said Steve Marascia, a senior research analyst at Capitol Securities Management in Henrico. The company has not disclosed sales figures for Marlboro snus, and spokesmen would say only that the overall snus category has grown from virtually nothing to about 3 percent of the total U.S. moist smokeless market in about three years.

Besides being sold in pouches, snus tobacco is different from conventional moist snuff in other ways. Unlike moist snuff, snus is not fermented. Instead, the tobacco is “cooked” or “heated to a high temperature degree,” as Tucker and Altria spokesman David Sutton described it. They would not say whether that means it is pasteurized, a process of heating foods such as milk to slow microbial growth. Tucker said the heating process helps reduce the harshness of the tobacco.

It is interesting to note that tobacco analysts felt the Marlboro name could not miss in the smokeless category. Citigroup tobacco analyst Bonnie Herzog Citigroup's Tobacco Analyst Bonnie Herzog told investors that PM USA will fully cement its place in the smokeless segment using the power of the Marlboro brand (8/21/2007). Philip Morris (PM) USA today announced that it will be introducing Marlboro Moist Smokeless Tobacco (MST)..">) Also - Altria's growth depends on the Marlboro name..

Reference: Refurbished York plant churning out Marlboro Snus, a new smokeless tobacco product Just four years ago the Merrimac Trail facility was idle. Now it employs about 100 workers by Jon Cawley (jcawley@dailypress.com), DailyPress, 10/2/2010.