I found a site describing the cost structure of one carton of Marlboro cigarettes in Canadian dollars in 2002: (http://wiki.answers.com/Q/What_is_the_true_cost_of_manufacturing_a_carton_of_Marlb oro_cigarettes.

#page3) The wholesale price is $53.01 out of which $42.89 is taxes. The exchange rate at that time (2002) was $1 Canadian = $0.63 US. Total manufacturing costs (before taxes and operating profit) is $5.7/carton. Materials comprise the larger proportion of the cost, while labor is relatively small indicating the automation nature of cigarette manufacturing. Tobacco leafs is the largest single cost input with $1.15/carton or more than 20% of the cost. Handling, transport and storage of tobacco leafs at the early stage constitute 17% of total costs. Production process (tobacco processing, plug making and cigarette making) comprise 19% of total costs. Packaging and shipping constitute 14% of the total. General business expense (including building depreciation and overhead) constitute the remaining 30%. Operating profits is estimated at $4.43/carton. Component Wholesale price Taxes Price charged by manufacturers Operating Profits Total manufacturing cost Material - Tobacco leaf Handling, transport & storage Production process Packaging & shipping General business expense Value $53.01 $42.89 $10.13 $4.43 $5.7 $1.15 Percentage

100% of cost 20% of cost ~17% of cost ~19% of cost ~15% of cost 30% of cost