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Cuba cuts cigar output as exports plunge

Sandokan

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Cuba cuts cigar output as exports plunge
FT.com / Commodities - Cuba cuts cigar output as exports plunge

By Marc Frank in Havana

Global economic woes and the spread of smoking bans are taking a harsh toll on production of what many aficionados consider to be the world’s finest tobacco in the lush green-brown valleys of Cuba’s western-most province, Pinar del Rio.
The province’s just concluded tobacco harvest came in at 22.4m leaves, down 14 per cent from 26m in 2009, according to Guerrillero, the province’s Communist party weekly.

The area’s tobacco accounts for much of the wrapper leaf and external filling that give Cuba’s prized cigars such as the Cohiba, Montecristo, Trinidad, Churchill and Partagas their flavour and scent.

“There was a reduction in planting due to limitations in resources caused by the economic crisis,” the weekly said.

According to the most recent report released by the government’s statistics office, the industry has fallen on hard times in recent years, with production of cigars for export down from 217m in 2006, to 123m in 2007 and 73m last year as the business drew on its inventory.
Another Castro brothers’ regime great success story. On September 15, 1960 the Castro regime took over 16 cigar factories, 14 cigarette plants and 20 tobacco warehouses, bringing to an end 300 years of tobacco development that made Cuban cigars the best in the world. The nationalization of the tobacco industry was the beginning of the end of one of the primary source of income for the island. The brothers’ destructive capacity has no limits.
 

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The cigar manufacturers and tobacco plantation owners have no choice but to leave the island with close to nothing, after their properties were seize and bank accounts frozen by the regime. They settled in different countries around the world. They start anew and due to their efforts the tobacco plantation and non Cuban cigar industry was born, spreading the tobacco seed they have taking with them from Cuba around the world.

They have been extremely successful in the establishment of tobacco plantation and cigar industry in countries like Dominican Republic, Honduras, Ecuador, Nicaragua and others. Dominican Republic has become the world's largest producer of premium cigars, surpassing by far Cuba production under the Castros regime.
 

Orion

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You can't just blame nationalization of tobacco though. In a recession a lot of people are in hard times, and the last thing they're going to do is go buy a box of cigars instead of rationing their money.
 

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Nowadays Dominican Republic is the world's biggest producer of premium cigars, surpassing even Cuba.

Premium cigar production 2009:

Dominican Republic 110 million exported to US
Cuba 70 millions exported

If the Castro regime hasn’t decimated the cigar industry and tobacco plantation, probably the Dominican cigar industry, Honduran tobacco, and Ecuadorian leaf, would haven’t grow as much as they have done. The exodus turned those Cuba's men with tobacco and cigar experience into master craftsmen and blenders, who through their experiments with tobacco found new flavors and recreated those of their youth.

The majority of Dominican, Honduran and Nicaraguan cigars owed their origins to those Cuban men. Most of the premium tobacco grow in these countries have their origin in the tobacco seeds smuggled out of Cuba by these men.
 

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Cuba curbs tobacco harvest as cigar sales fallBBC News - Cuba curbs tobacco harvest as cigar sales fall

5 July 2010 16:28 UK

Cuba has been forced to cut its tobacco harvest in response to a fall in demand for its famous Cuban cigars.

This year's harvest of tobacco leaves is down 14% on last year, according to one of the country's state-run newspapers, Guerrillero.

"There was a reduction in planting due to limitations on resources caused by the economic crisis," the report said.

Sales of Cuban cigars fell by 8% last year, while production has fallen even further.
Falling sales have pushed down production by even more. Last year, Cuba produced 73 million cigars for export.

That compares with the 217 million made in 2006.

But part of that reduction comes as Habanos, the company that produces and sells the cigars, runs down its stockpiles.

The hand-rolled cigars are a major export for the Caribbean island, although they are limited by a long-running US trade embargo.

Spain is the single biggest export market, where the recent introduction of a smoking ban has hit consumption.

Falling airline passenger numbers has also hit duty-free sales.
Tobacco leaf production reached 44,000 MT in 1958, with a total of 335 million cigars, and 624 million of cigarettes packages produced. The export of 79 million cigars produced $51 million. In 2009 tobacco leaf production was only 25,200 MT, with 300 million cigars produced for domestic consumption and 73 million of cigar for export with a value of $218 million. The production keep going down, a 75% reduction compare to the year 1958.

The island economy is in shambles. Cuba was one of the most prosperous countries in Latin America before 1959. Under the Castro brothers’ military dictatorship the island economy has been decimated. How is possible that after 51 years of a failure still there are people defending this regime?
 

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The tobacco industry accounted for 10% of the island exports at a volume of 11,434 million cigarettes and 79 million cigars in 1958.

The following formla adjusts any given amount of money for inflation, according to the Consumer Price Index (The Inflation Calculator). Due to the inflation what cost $1 in 1958, will cost $7.34 in 2009.

Adjusting for inflation the cigars exported in 1958 would have reached a value of $374 million in 2009.
 
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