Shisha Tobacco Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Product Type (Strong Shisha Tobacco, Mild Shisha Tobacco, Light Shisha Tobacco), By Flavor (Fruit, Mint, Chocolate, Others), By Distribution Channel (Direct Sales, Indirect Sales), By Region, By Competition, 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 1.19 Billion
CAGR (2026-2031)	6.94%
Fastest Growing Segment	Fruit
Largest Market	North America
Market Size (2031)	USD 1.78 Billion

Market Overview

The Global Shisha Tobacco Market will grow from USD 1.19 Billion in 2025 to USD 1.78 Billion by 2031 at a 6.94% CAGR. Shisha tobacco, also known as waterpipe tobacco or maassel, is a specialized combustible product composed of a mixture of shredded tobacco leaf, molasses, glycerin, and various flavorings, designed to be smoked through a waterpipe. The market is primarily supported by the widespread proliferation of hookah lounges and cafes, which position waterpipe usage as a central element of social interaction among young adults. Furthermore, the continuous innovation in diverse flavor profiles, ranging from traditional fruit blends to exotic combinations, serves as a critical driver that sustains consumer interest and expands the product's appeal beyond its traditional cultural strongholds.

According to the Food Export Council, in 2024, Egypt remained the world's largest exporter of shisha tobacco, accounting for 32% of global exports with a total value of USD 127.4 million. Despite this robust trade activity, the market faces a significant challenge regarding increasingly stringent regulatory frameworks. Many governments are enforcing higher excise taxes and implementing comprehensive bans on flavored tobacco products, measures that could substantially impede market expansion by limiting product availability and increasing costs for the end consumer.

Key Market Drivers

The proliferation of themed hookah lounges and social venues serves as a primary catalyst for market growth, effectively positioning waterpipe usage as a trendy lifestyle activity rather than solely a traditional habit. This shift is particularly evident in Western markets, where specialized cafes create a communal environment that drives product trial and frequency among younger demographics. These establishments utilize premium ambience and diverse flavor offerings to retain customers, directly translating foot traffic into sustained consumable sales. According to Tobacco Journal International, November 2025, the parent company of the Al Fakher brand reported having 14 million consumers worldwide in 2024, a figure significantly bolstered by the brand's dominance in these social venues.

Simultaneously, the increasing cultural globalization of Middle Eastern traditions has expanded the market's geographic footprint, enabling manufacturers to scale operations beyond domestic borders. As cross-border trade facilitates access to authentic blends, major producers are witnessing substantial gains in their international shipping divisions. According to Mubasher, February 2025, Eastern Company reported a 96% year-on-year increase in revenue from molasses tobacco exports during the second quarter of the 2024/2025 fiscal year. This export-driven momentum is further evidenced by the financial performance of leading global players; according to Business Wire, November 2025, Advanced Inhalation Rituals (AIR) generated USD 375 million in net revenue in 2024, underscoring the lucrative nature of the globalized shisha trade.

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Key Market Challenges

Stringent regulatory frameworks, specifically the enforcement of aggressive excise taxes and comprehensive bans on flavored products, act as a primary obstruction to the expansion of the Global Shisha Tobacco Market. These legislative measures directly erode market growth by artificially inflating retail prices, which places legal products beyond the financial reach of cost-sensitive consumers. When governments impose heavy levies, the price gap between compliant and non-compliant products widens, diverting consumer demand toward unregulated channels that do not contribute to legitimate market revenue. Furthermore, prohibitions on flavored tobacco strike at the core of the product's value proposition, as diverse flavor profiles are essential for attracting and retaining the demographic that drives the industry.

This regulatory pressure creates a volatile environment for manufacturers, limiting their ability to sustain sales volumes or enter new regions. The impact of such fiscal policies is evident in the rise of the black market, which absorbs potential legal growth. According to the European Smoking Tobacco Association, in 2024, steep excise tax hikes in specific jurisdictions drove illicit trade levels as high as 50%, significantly undermining the compliant sector. By simultaneously increasing costs for end-users and restricting the product features that generate interest, these regulations effectively stifle the legal market's potential for revenue generation.

Key Market Trends

The adoption of advanced electronic hookah and heat management technologies is reshaping the market by addressing consumer concerns regarding combustion toxicity and convenience. This trend involves a rapid migration from traditional charcoal-heated setups to sophisticated, pod-based electronic systems that offer consistent temperature control and reduced emissions. These innovations are attracting significant capital interest due to their ability to command higher margins while modernizing the user ritual. A clear indicator of this segment's strength is evident in the performance of market leaders; according to Tobacco Reporter, November 2025, in the 'AIR Taking its Shisha Public on Nasdaq in 2026' article, Advanced Inhalation Rituals reported USD 150 million in adjusted EBITDA for 2024, underscoring the substantial profitability of these technology-forward inhalation platforms.

Simultaneously, the growth of home-use specific product lines and packaging is driven by a shift where enthusiasts seek professional-grade experiences in private settings. Manufacturers are responding with resealable packaging formats and user-friendly kits catering to individual buyers rather than bulk commercial purchasers. This pivot allows producers to maintain robust revenue streams despite hospitality sector volatility, effectively insulating their business models from lounge-focused regulatory pressures. This resilience is highlighted by recent financial results; according to Mubasher, October 2025, in the 'Eastern Company's gross sales hit EGP 106.6bn in FY24/25' report, the company's gross revenues increased by 65% year-on-year to EGP 106.64 billion, confirming the expanding scale of the domestic consumer base.

Segmental Insights

The fruit segment is currently identified as the fastest-growing category within the global shisha tobacco market. This expansion is primarily driven by shifting consumer preferences toward milder and more aromatic alternatives to traditional strong tobacco profiles. New consumers are increasingly drawn to variants such as apple, berry, and citrus because these flavors effectively mask the harshness associated with unflavored tobacco. Consequently, manufacturers are prioritizing product innovation in this category to cater to the rising demand for diverse and palatable smoking experiences across social settings globally.

Regional Insights

North America stands as the leading region in the Global Shisha Tobacco Market, driven by the widespread proliferation of hookah lounges and a robust café culture, particularly in the United States. The region’s dominance is supported by high disposable incomes, which fuel demand for premium and exotic flavored blends among young adults. Furthermore, the presence of numerous domestic manufacturers fosters continuous product innovation, including the development of herbal and nicotine-free alternatives that cater to evolving consumer preferences. This dynamic commercial landscape, coupled with established distribution channels, secures North America's position at the forefront of the global industry.

Recent Developments

• In June 2025, Al Fakher collaborated with the international lifestyle and cannabis brand Cookies to release a co-branded line of shisha tobacco flavors. This partnership marked Cookies' debut in the hookah category and introduced five exclusive blends, including unique profiles such as Blueberry Caviar and Citrus Zen. The collaboration aims to merge the traditional hookah culture with modern lifestyle trends, leveraging the distinct brand identities of both companies to reach a broader audience through select retail and online channels, positioning the new products as a premium fusion of legacy and innovation.
• In January 2025, the parent company of Al Fakher introduced OOKA Pro, a new version of its charcoal-free device designed specifically for the hospitality sector. This professional-grade system features an extended battery life capable of lasting up to eight sessions and includes customizable LED lighting to match venue ambiances. The launch was accompanied by a partnership with Players House Dubai, which established the first dedicated bar for this technology, aiming to provide lounges and hotels with a more efficient and profitable shisha service solution that eliminates the need for live coals.
• In November 2024, Advanced Inhalation Rituals expanded its global footprint by launching its charcoal-free shisha device, OOKA, in the United States market. The device, which utilizes a pod-based system containing real shisha molasses, was introduced to offer a cleaner and more convenient alternative to traditional hookah smoking. This strategic launch targets the growing demand for modern inhalation experiences in North America, allowing consumers to enjoy consistent sessions without the preparation and mess associated with charcoal. The expansion underscores the company's commitment to modernizing the traditional shisha ritual for international audiences.
• In July 2024, Advanced Inhalation Rituals (AIR) announced the inauguration of a new Research, Design, and Development (RDD) Laboratory in Dubai, backed by a significant investment of AED 100 million. This state-of-the-art facility is dedicated to driving innovation within the shisha industry, specifically focusing on product testing and the development of new inhalation technologies. The company aims to leverage this hub to enhance its scientific capabilities and accelerate the creation of reduced-risk products, reinforcing its position as a global leader in the sector while fostering technical talent in the region.

Key Market Players

• Fumari
• Haze Tobacco
• Al Fakher Tobacco Factory
• Socialsmoke
• Japan Tobacco Inc.
• Soex
• Prince Molasses
• Romman Shisha
• Mazaya
• Cloud Tobacco

By Product Type	By Flavor	By Distribution Channel	By Region
Strong Shisha Tobacco Mild Shisha Tobacco Light Shisha Tobacco	Fruit Mint Chocolate Others	Direct Sales Indirect Sales	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Shisha Tobacco Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Shisha Tobacco Market, By Product Type:

• Strong Shisha Tobacco
• Mild Shisha Tobacco
• Light Shisha Tobacco

• Shisha Tobacco Market, By Flavor:

• Fruit
• Mint
• Chocolate
• Others

• Shisha Tobacco Market, By Distribution Channel:

• Direct Sales
• Indirect Sales

• Shisha Tobacco Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE