RJ Reynolds raises prices for cigarettes

NEW YORK - In the first sign that price wars might be ending in the tobacco industry, RJ Reynolds Tobacco announced yesterday that it is raising the price of almost all its cigarette brands by 4 cents a pack, or between 4 and 5 per cent, writes Larry Black.

The increase is the first since the spring, when the industry leader Philip Morris sparked a rash of discounting by cutting the price of its best-selling Marlboro brand by 40 cents a pack.

But analysts said that the across-the-board nature of the Reynolds increase preserves the narrow 50-cents-a-pack differential between premium and discount brands set by the Marlboro cut in April.

The increases cover the following premium brands: Winston, Salem, Camel, Vantage, More, Now and Horizon. Its so-called 'savings' brands include: Doral, Magna, Sterling, Monarch and Best Value.

Other companies are expected to follow RJR's lead. A spokesman for BAT Industries said the company welcomed the increase, and was 'currently deciding what to do in response'.