Cuba - Tobacco Reporter

Cuban Origin Ruling Final: Court

The German Federal Court of Justice has ruled that the use of geographical terms of origin “Cuba” and “Habana” and their derivatives “for tobaccos of other origins are inadmissible,” according to Habanos.

An appeal has been dismissed, and the judgment previously made by the Munich Higher Regional Court ruling that the terms are inadmissible for tobaccos of other origins is final. No further appeals are possible.

The lawsuit was in response to “unauthorized” and “misleading” use of terms such as “Habano Seed,” “Piloto Cubano,” “Habano Wrapper,” “Ecuadorian Habano Wrapper,” “Ecuadorian Habano Seed Wrapper,” “Cubra—the noble fire of Cuba: Criollo” and “Binder Habano Jalapa—Nicaragua” for non-Cuban tobaccos. The suit questioned whether geographical indications like Cuba and Habana and derivatives could be used for cigars from other geographical regions, especially if the origin is “delocalized” and indications of such, like Ecuador and Nicaragua, are used.

Corporacion Habanos took legal action in 2020 against the misleading nomenclature.

The Regional Court of Munich upheld the claim in full, and the Higher Regional Court of Munich dismissed the appeal from the defendant. The Federal Court of Justice has now rejected a final appeal, which was based on points of law not accepted by the Higher Regional Court of Munich.

According to both courts, use of these geographical terms deceives consumers and undermines the reputation of the geographical locations. By using the disputed terminology, one of the courts found, the defendant took advantage of the protected appellations of origin and their reputation to “transfer the concept, image and prestige” to products of other origins.

April 17, 2024

Tobacco Product Prices Up in Cuba

Beginning on April 12, Cuban tobacco users experienced higher retail prices for cigarettes and cigars. The brands are the domestic tobacco products sold in local stores used by Cuban residents, not tourists.

According to the report, the prices of cigarette-style brands like Criollo, Titanes, and Popular are now CUP 30 ($1.25) per pack of 20. H. Upmann Clásico, a short cigar sold with and without filters, is CUP 50, and Popular Auténtico is now CUP 60. (It should be noted that an American dollar on Cuba’s black market averages about CUP 300 to $1; this would put the price of a 20-pack of Populars at about $0.10.)

Minister of Finance and Prices, Vladimir Regueiro, told Cuban media that the current cost does not cover all the costs and expenses related to the production and commercialization of the tobacco products.

In a press conference, he added that the measure would “contribute to reducing the fiscal deficit in the country, and new financial resources may be mobilized from the state budget to support the social expenses of priority sectors.”

He also said that tobacco is not a necessity for the population and that the responsibility of the State and the government is to guarantee an appropriate level and assortment of food products.

April 14, 2024

Breaking Through Barriers

Cuba’s cigar industry is on the road to recovery after several challenging years.

By Timothy S. Donahue

The Cuban cigar industry made huge profits last year, but it wasn’t because it produced more cigars. While the impacts of the pandemic, the weather and the scarcity of almost everything are overwhelming, the Cuban people and its tobacco industry are finding ways to endure. The cigar industry mirrors the country as a story of overcoming adversity and sowing the seeds of a hopeful new beginning.

When Hurricane Ian’s winds began to howl in September 2022, they caused significant damage in the Pinar del Rio region, Cuba’s most prominent tobacco-producing province. The storm eviscerated crops and flattened 90 percent of the tobacco curing barns and other farming infrastructure needed to grow tobacco. The destruction came on the heels of the Covid-19 pandemic, which had already brought the worst economic suffering Cuba had seen in decades.

Recovery has been slow, but Cuba has endured. While this year’s tobacco crop is the worst in the written history of the island’s tobacco crops, Cuba’s newspaper, Granma, reported earlier this year that 4,776 barns have been rebuilt, and another 620 are being completed. Luis Sanchez-Harguindey, co-president of Habanos, the state-run global distributor of Cuban cigars, said during a press conference at the 24th annual Festival del Habano that Cuban growers had also focused resources on their most efficient, volume-producing farms.

“This growth factor has also been due to the enhancement of all the supply chains and the great effort done by Tabacuba, the producers, the tobacco growers, who, after the pandemic and the hurricane, have been increasing production,” he said. “We have a better group of products [we now can produce]. And these products that we offer, of course, do not satisfy the demand for the products yet.” He explained that the combination of increased demand and lower supply has been one reason for this year’s record growth.

As the 2023–2024 growing season closed, a representative of Grupo Empresarial Tabacuba—the state-run company charged with managing the production of Cuban tobacco and cigars—told Tobacco Reporter that only two-thirds of the pre-hurricane tobacco hectarage was used for tobacco cultivation this season. Tabacuba said it reduced its targeted goals for the 2023–2024 harvest from the planned 12,905 hectares to 10,200; however, the amount of land used to grow tobacco is expected to return to pre-hurricane levels for the 2024–2025 season.

“Today, we have a great [percentage] of this infrastructure operating at 100 percent. This has been possible because we quickly had all the necessary resources to build a workforce, a specialized labor force that can rebuild everything that had been destroyed,” Sanchez-Harguindey said. “There are still some minimally damaged areas. It is mainly issues related to construction [acquiring supplies]. Tabacuba has a policy to concentrate production with tobacco growers that traditionally produce higher yields and better quality. This has been possible during the year 2023. The impact, the result of all this work, is unprecedented growth in revenues over 2022.”

Getting a Boost

Sanchez-Harguindey said that while the farms produced less tobacco in 2023, Habanos achieved a major increase in the value of its cigars due to a new pricing structure and successful promotions of exclusive brands such as Trinidad and Cohiba. “We’ve been able to compensate for that reduction in volume with value,” he said.

Habanos earned revenues of $721 million in 2023, up 31 percent compared to the previous year. Last year, the company generated $545 million in revenue, nearly 2 percent more than in 2021. “This is a year of records,” Sanchez-Harguindey said at the Festival del Habano, which took place Feb. 26—March 1.

The company’s products are available on five continents. During 2023, the markets that contributed most to Habanos’ sales volume were Spain, France, China, Germany and Switzerland. Habanos is owned 50 percent by the Cuban government and 50 percent by a consortium of Asian investors under the umbrella of companies called Allied Cigar Group, which is rumored to be majority-owned by HuaBoa, a major Chinese tobacco flavoring company. By region, Europe remains the leading market for Habanos, accounting for 56 percent of total sales value, followed by Asia (21 percent), the Americas (13 percent) and Africa and the Middle East (10 percent).

In 2023, the company launched 31 new products, including Cohiba Siglo de Oro, Cohiba Ideales, Romeo y Julieta Cupidos, Hoyo de Monterrey: Monterrey No. 4, and Bolivar New Gold Medal. With its 27 marcas and a presence in more than 130 countries, Jose Maria Lopez Inchaurbe, vice president of development for Habanos, credited the company’s success to “excellence, tradition and innovation.” A more obvious answer for the revenue jump is the boost in Cuban cigar prices globally. Habanos, said Lopez Inchaurbe, has transformed the Cuban cigar into a luxurious, high-end smoke in global markets, especially in China.

During the media portion of the festival, several reporters asked for clarification of Habanos’ revenues. Andrea Rodriguez, from the Associated Press, questioned how revenues went from 2 percent in 2022 to 30 percent this year. Lopez Inchaurbe said that there are different reasons to justify the growth. He said, “It’s a reality that after the pandemic, both the luxury market and the consumption of premium goods around the world have been increasing considerably,” and that demand has been global.

Lopez Inchaurbe said that the company also positioned its “super-premium” segment (Cohiba and Trinidad) more prominently and promoted the brands heavily in markets where luxury cigars are in greater demand. There has also been an increase in limited-edition cigar releases. “In the year 2023, we have launched 32 new products, nine of them in the premium standard category, which is the permanent portfolio of Havana, and 22 of them are in the concept of specialties,” he explained.

In 2022, Habanos announced a new “global pricing standard,” which massively increased the prices of Cuban cigars worldwide. The company has already announced at least two additional price increases for 2024. The price increases have significantly impacted the costs of Cuban cigars. Five years ago, the Cohiba Siglo IV, the flagship of the Cohiba brand, cost less than $60 a stick. Today, the cigar costs nearly $400 a stick in most markets. However, not all markets are treated equally.

Store shelves in Cuba were not heavily stocked during Tobacco Reporter’s visit. Finding large-ring-gauge cigars or anything with a Cohiba or Trinidad label was also difficult. Many local cigar shops in Havana said that they had not received shipments in more than a year, and some La Casa del Habanos (LCDH) locations said that it had been at least nine months since they had a cigar delivery. For the festival, however, every shop seemed to have received shipments of varying vitolas and marcas. Many shops had the new Romeo y Julieta Cupidos, 20 for $1,600, and boxes of the new Cohiba Siglo de Oro, priced at $4,500 for 18 sticks ($250 each).

An interesting, unusual occurrence was the introduction of a new POS system for payments during the festival. This system now allows Americans to purchase Cuban cigars (for consumption while on the island) with their U.S.-based credit cards, which has long been impossible. However, it is unclear whether this is a coincidence or if it was a permanent addition to the Cuban payment system. Tobacco Reporter was told that the new payment system is currently being used in only two of the LCDH stores in Cuba; however, it is expected to expand to all LCDH locations.

The Featured Event

In the past, registration for the Habanos Festival opened months before the event. However, last year, registration opened a mere 40 days before the event, and this year, Habanos gave attendees only 27 days to register. Overall, this year’s festival was better than most. The entertainment was spectacular, and the cigars were the best in the world.

Habanos celebrated several milestones this year, including the company’s 30th anniversary, the 50th anniversary of the Quai d’Orsay brand and the 55th anniversary of the Trinidad brand. Featuring an estimated 2,200 attendees and more than 200 journalists, the festival is where Habanos showcases its assets and previews a number of its major releases every year. The festival features multiple seminars, epic dinner events centered on various brands, and a trade show with over 200 exhibitors.

Traditionally, Tuesdays are reserved for trips to Pinar del Rio, Cuba’s legendary tobacco-growing region. While many media attendees visited the famed Vegas Robaina farm, Tobacco Reporter visited a smaller farm in San Juan y Martinez, often called the “Mecca of tobacco.” The fields looked exceptionally healthy, with broad, green leaves. The curing barns had been freshly painted, and the workers seemed vibrant and plentiful. The barns were in the process of being filled.

This year, attendees were also allowed to roll a cigar alongside professional rollers at one of five factories. It marked the first time the festival hosted its master rolling class in the same buildings where Habanos cigars are produced. Daymi Difurniao Rodriguez, communications and marketing specialist for Habanos, said that the venue change was to allow more attendees to learn firsthand about the “Totally by Hand” production process of a Habano.

“I wanted the press to make their own Habano so they could understand the details and intricacies involved in creating the Habanos, the world’s finest cigars,” said Difurniao Rodriguez.

The torcedor (cigar roller) who taught the El Laguito class was quality specialist Ana Isel Mederos Cano. She is also a nominee for the Habano Woman of the Year award in the production category for the festival. She has been at El Laguito for 25 years, 11 of them as a roller and the past 14 in her current position. “I love that I have been given this opportunity to teach the art of cigar rolling to the representatives of media from around the world,” she said.

Visitors had the opportunity to visit the La Corona, Partagas, H. Upmann and Carlos Balino factories. El Laguito was for media only. La Corona has about 750 employees, 300 of whom are dedicated rollers. The rollers produce brands such as Hoyo de Monterrey, Montecristo, Cuaba, Diplomaticos and San Cristobal de la Habana.

The H. Upmann factory produces H. Upmann, Montecristo, and Romeo y Julieta and several sizes of Cohiba. Partagas is one of Havana’s iconic factories, and Carlos Balino is the former El Rey del Mundo factory. The legendary El Laguito is home to Habanos’ premier marcas, Cohiba and Trinidad.

As in previous years, the Gala Dinner takes place during the final night of the Habanos Festival. It includes the presentation of the prestigious Habanos Awards and the auction of several elaborate humidors. The proceeds from the auction are donated to the Cuban Public Healthcare System.

This year’s auction included seven humidors, one for each of the company’s six global brands: Cohiba, H. Upmann, Hoyo de Monterrey, Montecristo, Partagas and Romeo y Julieta. Additionally, one humidor was dedicated to the 55th anniversary of the Trinidad brand. Eight lots were sold for a combined €17.8 million ($19.3 million), setting a record for the auction.

The headliner for the festival’s gala dinner was none other than the Village People. As the crowd swayed to hits such as “YMCA” and “Macho Man,” the challenges of growing and selling cigars, and surviving in the country, could be forgotten for a while.

Timothy Donahue is the assistant editor of Tobacco Reporter. Since joining our team in January 2013, he has become not only an expert on the traditional tobacco business but also a well-respected voice in the rapidly developing vapor industry. Tim spends much of his time on the road, attending conferences and interviewing industry representatives. His networking skills, work ethic and quick mind are valuable assets to our diverse audience.

April 1, 2024

Habanos Announces Deal With Liquor Maker

Chinese liquor company Luzhou Laojiao and Cuban cigar company Habanos SA have signed a strategic agreement to jointly expand their markets.

During the 24th Habano Festival in Havana, Cuba, Zhang Biao, general manager of Luzhou Laojiao, highlighted the similarities between Luzhou Laojiao’s liquor and Cuban cigars, noting that the cooperation will strengthen the commercial ties between China and Cuba.

The agreement includes a joint product through co-branding, with the Chinese company handling the marketing. José María López, vice president of development at Habanos, said that this partnership is based on shared values such as craftsmanship, quality and leadership, highlighting the “perfect match” between Chinese liquors and Cuban cigars.

Habanos executives reported that China is one of the most dynamic markets for Cuban cigar sales. The country contributed heavily to a 31 percent increase in Cuban cigar sales in 2023, reaching a total of $721 million.

The signing of the Memorandum of Understanding aims to explore new avenues of cooperation for both companies. Luzhou Laojiao, one of China’s oldest liquors, has been produced in the National Treasure Cellars since 1573, with distillation technology dating back 700 years.

The collaboration will focus specifically on Luzhou Laojiao’s “Guojiao 1573” brand and Habanos Corporation’s Cohiba Atmosphere brand. In addition, seven Guojiao 1573 brand liqueurs were auctioned along with during the festival’s humidor auction, with the funds raised going to public health initiatives in Cuba.

“This strategic agreement strengthens commercial ties between China and Cuba in the liquor and cigar industries,” according to a press release.

March 11, 2024

Cuba Festivalgoers Roll Cigars at Factories

Activities during the 2024 Habanos Festival usually only vary slightly. However, this year, attendees were allowed to roll a cigar alongside professional rollers at one of five factories. It marked the first time the festival hosted its master rolling class in the same buildings where Habanos cigars are produced.

Daymi Difurniao Rodríguez, communications and marketing specialist for Habanos, said that the venue change was to allow more attendees to learn firsthand about the “Totally by Hand” production process of a Habano.

“I wanted the press to make their own Habano so they could understand the details and intricacies involved in creating the Habanos, the world’s finest cigars,” she said.

The torcedor (cigar roller) who taught the El Laguito class was Ana Isel Mederos Cano, main quality specialist at El Laguito. She is also a nominee for the Habano Woman of the Year award in the production category for the XXIV Habano Festival currently taking place in Havana.

She has been at El Laguito for 25 years, 11 of them as a roller and the past 14 in her current position.

“I love that I have been given this opportunity to teach the art of cigar rolling to the representatives of media from around the world,” she told Tobacco Reporter.

The venue change was a welcome addition, according to several festival attendees. A seasoned festival media participant, Nicholas Syris of LH Cigars and several cigar podcasts, who also rolled at El Laguito, said the personal attention from the professional rollers helped festival goers learn the challenging art of rolling cigars better than in a large conference room setting.

“It was really good. It was a nice addition to the festival,” he said. “I would say many more people rolled a smokable cigar than previous editions of the festival.”

Visitors had the opportunity to visit La Corona, Partagás, H. Upmann and Carlos Baliño. El Laguito was for media only.

La Corona has about 750 employees, 300 of which are dedicated rollers. The rollers produce brands such as Hoyo de Monterrey, Montecristo, Cuaba, Diplomaticos and San Cristobal de la Habana.

At the H. Upmann Factory, H. Upmann, Montecristo, and Romeo y Julieta, and sometimes several sizes of Cohiba are produced. Partagas is one of Havana’s iconic factories and Carlos Baliño is the former El Rey del Mundo factory.

Tobacco Reporter was only permitted to attend El Laguito, the legendary home where many of Habanos’ premier marcas are produced.

Festival roller trainees were given a wooden board to roll, a “chaveta” tobacco leaf cutting blade, some vegetable glue, and an apron. Several factory rollers made rounds around the room helping festival attendees roll their cigars.

“I love this new idea,” said Brooks Whittington with Halfwheel, a major industry cigar information website. “While the rolling competition has always been a favorite part of the festival for me, getting to roll the cigars at the actual factory we were visiting took the experience to the next level.”

Many other attendees said they hope the tradition continues. The 2024 Habanos Festival is being held in Havana from Feb. 26 – March 1.

March 1, 2024

Habanos Reports $721 Million Turnover

Corporacion Habanos generated revenues of $721 million in 2023, up 31 percent compared to the previous year.

“The achievements of Habanos S.A. during 2023 are the result of the recognition of the unique origin of our tobacco, the strength and prestige of our brands, and, of course, the passion shared by all those involved in this fascinating world of Habanos,” Habanos’ co-presidents, Maritza Carrillo Gonzalez and Luis Sanchez-Harguindey, were quoted as saying in a press note.

“Thus, we celebrate 30 years of Corporacion Habanos, S.A., offering unparalleled moments and experiences to all lovers of premium tobacco in every corner of the world.”

With 27 brands and a presence in more than 130 countries, Habanos attributed its performance to “excellence, tradition and innovation.”

The company’s products are available on five continents. During 2023, the markets that contributed most to Habanos’ sales volume were Spain, France, China, Germany and Switzerland. By region, Europe remains the leading market for Habanos, accounting for 56 percent of total sales value, followed by Asia (21 percent), the Americas (13 percent) and Africa and the Middle East (10 percent).

In 2023, the company launched 31 new products, including Cohiba Siglo de Oro, Cohiba Ideales, Romeo y Julieta Cupidos, Hoyo de Monterrey Monterreyes No. 4 and Bolivar New Gold Medal.

During the Habano Festival this week, the company will be unveiling several additional products.

February 27, 2024

Cigar Lovers Gear Up for Habano Festival

Havana is decked out to welcome experts and premium tobacco enthusiasts at the 24th Habano Festival, to be held from Feb. 26-March 1, 2024. This year, the festival not only honors the rich heritage and tradition of Cuban tobacco with special celebrations for the anniversaries of renowned brands such as Quai D’Orsay and Trinidad, but will also look back on 30 years of success for Corporacion Habanos.

The Festival will kick off with the opening of the trade fair, a key meeting point for industry professionals, manufacturers of premium products and artisans, which this year welcomes 85 companies from 11 countries. That same night, the Club Habana will be the venue for the welcome evening, to commemorate the 30th anniversary of Corporacion Habano.

The Quai D’Orsay brand will be the star of the mid-week Evening at the Cubanacán Protocol Lounge in El Laguito. During the event, attendees will participate in a tribute to the brand’s 50th anniversary and discover this special vitola, in its world premiere presentation.

The Gala Evening will take place in Hall C of the Pabexpo Fairgrounds. This will mark the beginning of the “Trinidad Year,” during which its 55th anniversary will be celebrated, and some of the most important launches for the brand will be enjoyed. On this last night, as on previous occasions, awards will be presented to the winners of the final of the Habanos World Challenge contest as well as to the winners of the long-awaited Habanos Awards, a worldwide recognition to those who in 2023 supported Habanos the most in terms of communication, business, and production. The final highlight will be the traditional Humidor Auction, which this year will feature novelties for attendees, and whose proceeds will go, as usual, to support the Cuban Public Health System.

The traditional visits to plantations will take place in the zone of Vuelta Abajo, in the Pinar del Río, recognized worldwide as the best land to grow tobacco. In addition, attendees will have the opportunity to visit the Habanos factories of La Corona, Partagás, H. Upmann and Carlos Baliño, where they will be able to learn first-hand about the “Totally Handmade” Habano-making process and take part in a Habano-rolling master class in which they will be able to make their own Habano.

The international seminar will feature presentations such as “Two Cities United by Habanos,” focusing on the Quai D’Orsay brand, and the panel “Trinidad: Past, Present and Future” which will delve into one of Habanos’ most prestigious brands. Besides, exclusive pairings will be offered, such as Taittinger champagne with Habanos Trinidad, Quai D’Orsay and San Cristóbal de Havana. Or the very popular Habanos Moments with the best rums and the finest wines. The seminar will close with the final of the Habanos World Challenge contest, where aficionados will be able to put their Habano knowledge and skills to the test to prove they are the most knowledgeable as far as the universe of Habanos is concerned.

February 23, 2024

Cuba Pushing Renewable Energy

TabaCuba the state-run arm of Cuban cigar production, announced that it would increase its use of renewable energy sources in several of its facilities in Pinar del Rio, Cuba’s largest tobacco leaf-producing province.

All tobacco export factories should have this type of equipment in the first half of this year, TabaCuba’s president, Marino Murillo, told the Cuban News Agency.

Artemisa, Villa Clara and the westernmost territory already have the type of equipment to increase productivity.

According to the official, pre-industrial processes and irrigation to save energy carriers with submersible pumps are the priority.

He also stated that they are betting on renewable energy sources so that the productive processes do not stop in the event of an interruption of electricity services.

January 8, 2024

Habanos Debuts ‘El Rey Del Mundo Royal’

Habanos S.A. released its latest vitola, the El Rey Del Mundo Royal Series, at an event in Cyprus last week. The event was put on one of Habanos’, the Cuban cigar industry’s distribution arms exclusive distributors, Phoenicia T.A.A.

The Royal Series (50 ring gauge x 155 mm length) will be on sale exclusively at La Casa Del Habano franchise stores.

The company also unveiled new products such as the Edición Regional Por La Larrañaga Fénix, and the new Cohiba Wide Short (machine-made Cuban cigar).

The launch of the new vitola shared the spotlight with both companies celebrating 15 years of a “fruitful business partnership,” according to an emailed release.

The event brought together more than 450 aficionados from Lebanon, United Arab Emirates, Qatar, Kuwait, Malta, Italy, France, Spain, Germany, United Kingdom, the Democratic Republic of Congo, Switzerland, the Netherlands, Kuwait, Bulgaria, Canada and Bahrain.

Also in attendance were the co-presidents of Habanos, Maritza Carillo González and Luis Sánchez-Harguindey Pardo de Vera.

December 11, 2023

Planting on Schedule in Sancti Spiritus

Tobacco planting in Cuba’s Sancti Spiritus province are proceeding according to schedule, reports Prensa Latina.

The 2023-2024 crop is expected to benefit from investments in science and technology, according to Isidro Hernandez, agricultural director of the local tobacco collection and processing company.

According to Prensa Latina, tobacco growers have been satisfied with the contributions achieved through root ball tunnels and seeds obtained through mechanization and phytosanitary care.

Meanwhile, photovoltaic panels are assisting in the efficient administration of fertilizers and optimal use of water.

In addition, controlled leaf curing will reduce farmer’s reliance on the weather.

November 23, 2023

Tag: Cuba

Cuba’s cigar industry is on the road to recovery after several challenging years.

Getting a Boost

The Featured Event