What will happen to the NC manufacturers when the embargo is lifted ?

[nubchin]

One of the biggest questions for me would be how and why the embargo dropped. There could be a regime changes before it drops in which case are we to assume that a government agency would still control tobacco production and sales? Things could go completely different then any of us expect. Personally I would love to see some of the other manufactures get access to cuban tobacco and see what they would produce.


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Well, I thought the embargo was placed by the Kennedy Admin and not by the Cubans . Fidel always said he wants to sell cigars to the US .
The Raul admin is obviously shifting towards chinese economic model , free market+tight party ( not that party:santa2 control . If the US trades with China without political problems (not mentioning the huge amount of US GOV Bounds in Chinese hands ) , why not with Cuba post transitions?
1 year embargo extension meaning 1 year for the Cubans to prepare?

But back to topic , what will happen to those tobacco farmers and rollers in Honduras Nicaragua and other Central American countries who are in the "Cubanesque" league ? Will the Cubanesque manufactures abandon them if they find ways to produce cigars in Cuba? Or do they have a clear strategy for Nicaraguan Honduran tobacco?

 

[Skitalets]

Well, I thought the embargo was placed by the Kennedy Admin and not by the Cubans . Fidel always said he wants to sell cigars to the US .
The Raul admin is obviously shifting towards chinese economic model , free market+tight party ( not that party:santa2 control . If the US trades with China without political problems (not mentioning the huge amount of US GOV Bounds in Chinese hands ) , why not with Cuba post transitions?
1 year embargo extension meaning 1 year for the Cubans to prepare?

The way I read gibbleguts' post is that gradual liberalization might not be the reason we end the embargo. Overthrow of the regime is never totally out of the question, and while it might cause us to end the embargo, the resulting government might not keep running the tobacco industry. Cuban society might not even be stable enough to produce cigars for a time. It could take time for things to stabilize, and the resulting industry might not produce Montes and Cohibas.

 

[Jfire]

But back to topic , what will happen to those tobacco farmers and rollers in Honduras Nicaragua and other Central American countries who are in the "Cubanesque" league ? Will the Cubanesque manufactures abandon them if they find ways to produce cigars in Cuba? Or do they have a clear strategy for Nicaraguan Honduran tobacco?[/QUOTE]

From Pepins mouth through PJ in Nicaragua. "I'm not leaving Nica, ever"

 

[nubchin]

Great points Aaron. I especially like your last point, I would love to see someone like the Fuentes or Padron(who age their tobacco prior to release in some cases for many years) leave their fingerprint on Cuban tobacco.

I do too personally , but watching it from the Cuban point of view , do you think those individuals who acted on favor for Batista , sabotaged and burnt the hell out of the tobacco fields after the revolution , head hunted blenders and rollers , stole newly developed seeds , labeled there cigars Cubanesque and not Nicaraguanesque or Honduranesque , do you think the Cubans will sell there tobacco to them just to make them fatter ? A black market threw relatives between Cuba and Nicaragua , maybe, but some how I guess the Cubans think the Cubanesque league had all there shares already .

 

[nubchin]

The way I read gibbleguts' post is that gradual liberalization might not be the reason we end the embargo. Overthrow of the regime is never totally out of the question, and while it might cause us to end the embargo, the resulting government might not keep running the tobacco industry. Cuban society might not even be stable enough to produce cigars for a time. It could take time for things to stabilize, and the resulting industry might not produce Montes and Cohibas.

Over throw you mean by force ? braking the non-interference pact with USSR after the missile crisis ? Will the Russians allow that to happen ? Maybe , maybe not , lets see how the Syrians solve there problem , then we will know whats up with the Russians .

 

[W.B.]

I do too personally , but watching it from the Cuban point of view , do you think those individuals who acted on favor for Batista , sabotaged and burnt the hell out of the tobacco fields after the revolution , head hunted blenders and rollers , stole newly developed seeds , labeled there cigars Cubanesque and not Nicaraguanesque or Honduranesque , do you think the Cubans will sell there tobacco to them just to make them fatter ? A black market threw relatives between Cuba and Nicaragua , maybe, but some how I guess the Cubans think the Cubanesque league had all there shares already .

Short answer, yes. Longer answer; people, especially people who are driven and poor will find a way to make money. Because I feel for their nation, it would be imprudent for me and the knowledge I have to comment on the Cuban people's sensitivities. I have never been to Cuba nor know any ex-patriots to form an opinion about the scenario you've presented.

 

[nubchin]

But back to topic , what will happen to those tobacco farmers and rollers in Honduras Nicaragua and other Central American countries who are in the "Cubanesque" league ? Will the Cubanesque manufactures abandon them if they find ways to produce cigars in Cuba? Or do they have a clear strategy for Nicaraguan Honduran tobacco?

From Pepins mouth through PJ in Nicaragua. "I'm not leaving Nica, ever"[/QUOTE]

No doubt .
I some how think DPG , PJ and a few are working all ready , plus they have the talent to produce a grate cigar no mater what tobacco . But what will happen to them if the fellow US smoker would have access to Cubans ?

I personally think it will only result in the better for all smokers , all access to Cubans + Low priced high quality NCs flowing the market .
I just hope the transitions will be a smooth one for the end farmers and rollers in Central America cause the lack of a clear strategy from the manufacturers part to promote there countries crops are astonishing .
Whats your opinion?

 

[nubchin]

Short answer, yes. Longer answer; people, especially people who are driven and poor will find a way to make money. Because I feel for their nation, it would be imprudent for me and the knowledge I have to comment on the Cuban people's sensitivities. I have never been to Cuba nor know any ex-patriots to form an opinion about the scenario you've presented.

I do too for the people in Cuba and the Cubans out side, also for the people in Central America and wish they had a steady identity ( cigar wise ) before the lift and let free of the word "cubanesque" as soon as posible, but politics aside , do you think Habanos would sell tobacco to General Cigars for example
If they would have to make a deal , that would be Joya de Nicaragua ( politics included ) IMO .
What do you think?

 

[amsgpwarrior]

I have heard from several sources in the industry (my sources are confidential) that some of the big guys in the cigar industry in Honduras and Nicaragua already have aged Cuban tobacco leaf in storage. The plan is to use the leaf in there blends in the future.

Do I think it will make a huge difference for the embargo to be lifted for other tobacco producing nations? In the short term yes, but in the long term no. In the short term I believe people will buy the crap out of cubans just because they have access to them now. Then those people (mainly novice smokers) will get their fill of cuban tobacco and be done. The rest of us experienced smokers will put them in our rotations of cigars but go back to smoking what we like. The industry big boys will use cuban tobacco as they see fit and everyone will be better for it.

Cuba, as it is, won't be able to fill the initial rush of demand from its new market if the US was to lift the embargo. And we are being awfully optimistic that they would even sell to the US. Why should they? They have no incentive to sell their product to us. They sell everything they make now to other markets. The demand already exceeds the production now.

If Cuba becomes a free market society then that will make a huge difference in the cigar industry. The quality of leaf being grown will drastically improve and become cheaper. Growing tobacco organically like they do now is expensive.

So it comes down to this:

1) If Cuba stays socialist and the tobacco continues to be state owned but the embargo is lifted= not much change in the long run.

2) If Cuba becomes a free market economy and opens up to foreign investment= a total renaissance of the cigar industry for all nations and manufacturers/brands.

 

[nubchin]

I have heard from several sources in the industry (my sources are confidential) that some of the big guys in the cigar industry in Honduras and Nicaragua already have aged Cuban tobacco leaf in storage. The plan is to use the leaf in there blends in the future.

Do I think it will make a huge difference for the embargo to be lifted for other tobacco producing nations? In the short term yes, but in the long term no. In the short term I believe people will buy the crap out of cubans just because they have access to them now. Then those people (mainly novice smokers) will get their fill of cuban tobacco and be done. The rest of us experienced smokers will put them in our rotations of cigars but go back to smoking what we like. The industry big boys will use cuban tobacco as they see fit and everyone will be better for it.

Cuba, as it is, won't be able to fill the initial rush of demand from its new market if the US was to lift the embargo. And we are being awfully optimistic that they would even sell to the US. Why should they? They have no incentive to sell their product to us. They sell everything they make now to other markets. The demand already exceeds the production now.

If Cuba becomes a free market society then that will make a huge difference in the cigar industry. The quality of leaf being grown will drastically improve and become cheaper. Growing tobacco organically like they do now is expensive.

So it comes down to this:

1) If Cuba stays socialist and the tobacco continues to be state owned but the embargo is lifted= not much change in the long run.

2) If Cuba becomes a free market economy and opens up to foreign investment= a total renaissance of the cigar industry for all nations and manufacturers/brands.

Interesting .
Thats based on entering the free market with an agricultural product which has a contradictory effect in some nations , specially with a product that is a staple income source for this nation .

Some how I get scared with this phrase , one reason that makes smokers lean toward Cubans is because they are organic . >The quality of leaf being grown will drastically improve and become cheaper. Growing tobacco organically like they do now is expensive. <

 

[coastalgriff]

I think the NC makers will be fine.Their QC is definitely better. I have both and choose based on what I am in the mood for.

 

[nubchin]

An interesting article by Frank Herrera about retail cuban cigar stores in the US .
http://cigarlaw.wordpress.com/2011/08/22/habanos-files-new-tms-for-retail-store-services/

 

[nubchin]

Comparing wine to cigars , as a market , cigars are too young to be steady compared to wine with some few thousand of years in the back ground . The only country who competes and stands out is obviously Cuba , but Central American countries were dragged into the cigar world by the demand in the US , the problem is that they will probably face abandonment after the US consumers shifting back to Cubans , and the word cubanesque would sound as if a curse after the embargo.
I only hope the central American countries plus the manufacturers would try to gain a status similar to Napa valley or what ever good non-french wines before the embargo is lifted . Or we as consumers in non-US countries would have to start buying non-cubans more , so the international tours by PJ and DPG, Perdomo pumping out most of his Edicion de Silvios to Russia are logical ( well , Perdomo got out of the revolution which USSR supported and in some degree still is , kind a ironic ) .
What are your thoughts?

 

[ajacobs]

When you look at the foreign market, which has access to any type of cigar they smoke primarily cuban cigars - you could either argue that they are intrinsically better or the mystique has prevailed. In any case my guess is those same factors will influence domestic consumers if the embargo is lifted.

 

[nubchin]

When you look at the foreign market, which has access to any type of cigar they smoke primarily cuban cigars - you could either argue that they are intrinsically better or the mystique has prevailed. In any case my guess is those same factors will influence domestic consumers if the embargo is lifted.

Cant agree more . I my self started smoking NCs by marketings and ended up 2-3% NCs in stock . I do look back hoping for a diamond but black cole as usual it ends .
But for the non-cuban side , do you see a clear strategy to encounter the lift ? or is it cutting each other for survival ?
What does the Central American farmers and rollers has to do?
What does the manufacturers have to do?
What do we as consumers have to be aware of ?

 

[Moose]

I dont see much of a change from the circle of friends I smoke with, sure we all enjoy a cuban here and there, but outside of a monti #2 I would much rather smoke a nice tat. I do not think it will have much of a impact in the large scale of things. I think the worse part will be the large volume of fakes that will soon engulf our country on a much larger scale then before.

 

[njstone]

Post-embargo I won't buy any fewer NCs than I do now, but I'll be buying Cubans ... at least at first.

Here's what will happen folks ... I have this on good authority, I cannot say where, but let's just say the guy drives a Delorian ...

If we assume that Cuba is still Communist when the embargo lifts, then we'll see a large jump in demand due to the US market, which will in turn necessitate an increase in manufacturing in Havana. HSA claims they are currently far below their production ability (like less than 50%), but communist countries have notoriously over-extended themselves in terms of manufacturing ability vs. viability. HSA also claims they have tons of stock sitting around that would satisfy the first year post-embargo anyway, and that may even be true.

Sure, they can pump out as many cigars as the world could ever want--I have no doubt on the quantity front. The question is what will happen to the quality. People have bemoaned Cuban cigar quality for many years now, and rightly so. Some claim there has been a sharp increase in quality since 2006, and even if that is conceded I think many would agree that the "failure rate" for Cuban cigars is still much higher than for quality non-Cuban cigars. Increased production (by a good margin the first couple years post-embargo) can only hurt quality under the current HSA system which rewards only numbers and not a quality finished product.

My feeling about HSA even now is that they are laughing all the way to the bank. They believe that people who buy Cuban cigars will continue to do so no matter what. There is therefore no incentive to make great products, and every incentive to cut out a dozen or more vitolas every single year ... "You liked the Bolivar Corona Extra? Oh well, you'll just buy more Royal Coronas now." I honestly believe this is how they think, and that's based both on watching HSA operate and my own studies of communism in school.

So, the first couple years HSA knows that America will just gobble up their stuff whole hog (and they are probably right in that case), and priority one will be producing enough to meet demand. I think you'll see QC plummet at that point on virtually every popular vitola, and across the board. The problem is that after 4-5 years when people get over the "OH MY GOSH THESE ARE FRICKIN' CUBANS DUDE!!!" they will start to see the crappy quality and stop buying them.

This will either force HSA to strive for better quality, or (more likely) begin another decade of extremely average Cuban cigars.

My friends, what we really want to happen here is not for the embargo to end. What we want is for Cuba to be FREE! These people deserve freedom, and they long for it. I'd gladly give up Habanos for the rest of my life if it meant the Cuban people could be free tomorrow. Neither the cigar industry nor the people of Cuba will reach anywhere near their potential until they are free.

 

[keinreis]

My friends, what we really want to happen here is not for the embargo to end. What we want is for Cuba to be FREE! These people deserve freedom, and they long for it. I'd gladly give up Habanos for the rest of my life if it meant the Cuban people could be free tomorrow. Neither the cigar industry nor the people of Cuba will reach anywhere near their potential until they are free.

I like your stance on this!

 

[JDog]

I like your stance on this!

+1 I do as well.

 

[njstone]

When you look at the foreign market, which has access to any type of cigar they smoke primarily cuban cigars - you could either argue that they are intrinsically better or the mystique has prevailed. In any case my guess is those same factors will influence domestic consumers if the embargo is lifted.

[NOTE: The following is meant as discussion, not criticism or argument, we're all friends here ]

That argument is flawed. "People in Japan only drive Japanese cars, therefore they're the best" is also untrue. And I think the premise is inaccurate anyway. I do not think most people do "have access to any type of cigar." Maybe the Brothers here from outside of North America can comment on this, but it's my understanding that many countries DO NOT SELL NON-CUBANS, or at least sell them very sparsely. I've been to several shops here in Japan, and I've never seen a non-Cuban cigar (granted, I live up north in the wild, lol, so there are probably a few shops in Tokyo that do). I know a few guys in Great Brittan who say it's really hard to find a shop that carries more than a few non-Cubans (though most carry a few). And the argument that "They'd sell them if they sold well" is fallacious, because you're talking about many products that are only a few years old, so I'm sure they haven't seen any shelf time at all. So where are people going to discover non-Cuban cigars?

The internet? This problem is compounded by the fact that many countries do not allow the importation of tobacco (or charge insanely high tariffs, such as Japan), and therefore a great many online cigar retailers in the US will not ship outside the US at all. Now if you're a member of a forum such as ours, of course you can get hook-ups for virtually anything the US has to offer, but I dare say that we here are in an extreme minority. The majority of cigar smokers are not involved in internet forums and wouldn't even think to go to the trouble of trying to acquire cigars that are more than a drive or a website away.