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Home > What's New > Cigar Shipments Up for 2003
Cigar Shipments Up for 2003
Posted: Friday, March 05, 2004
By David Savona
The American premium cigar market is looking surprisingly strong. Imports of handmade cigars increased by 4.2 percent in 2003, to 276 million cigars, a performance that came on the heels of five percent growth in 2002. More premium cigars were shipped to the United States than in any year since 2000, when around 290 million cigars were imported.
Double-digit growth from Honduras and a strong showing from market leader Dominican Republic contributed to the increase in 2003. It was a pleasant end to what originally appeared to be shaping up as a poor year. A brutal winter and fewer places for people to smoke conspired to keep cigar sales low in the beginning months of 2003, but a superb holiday season and strength throughout the rest of the year made this the best cigar market in years.
"The first four months of 2003 were the worst four months that I've ever seen in history," said Manuel Quesada, owner of Manufactura de Tabacos S.A. and S.A.G. Imports Inc., the maker and distributor, respectively, of Fonseca and Cubita cigars, among others. "Weather had a lot to do with it. When weather hits from Chicago to Boston and from New York to Atlanta, that's a big chunk of the market right there. Prohibition started to come in heavily in 2003, so weather and prohibition combined to make the first four months of that year really terrible. The rest of the year," said Quesada, "made up for the first four months."
The cigarmakers of the Caribbean and Central America are busy, as are the companies that supply them. Tobacco grower and broker John Oliva Jr. of Oliva Tobacco Co. says his company is selling more tobacco now than it did during the cigar boom. "I don't know how to explain it," the Tampa, Florida-based executive said, "but we're moving product.
Shipments from the Dominican Republic increased by 5.3 percent over 2002 levels, to 160 million cigars. The Dominican Republic, home to such brands as Montecristo, Arturo Fuente, Macanudo and Davidoff, makes 58 percent of the handmade cigars shipped every year to the United States. Some companies hired new cigar rollers in 2003 to keep up with business, including El Credito Cigars, maker of La Gloria Cubanas, and Tabacalera de Garcia, the largest cigar factory in the Dominican Republic and the home of Montecristos, H. Upmanns and Romeo y Julietas. El Credito turned a cafeteria into a new rolling area and intends to hire more workers still, and Garcia added workers to try to cut down on the Saturday shifts that the plant requires to meet demand. Some sizes and brands are still on back order.
Honduran cigar exports were the fastest growing among the major producers. Shipments from the Central American nation were 77.7 million cigars, 12.4 percent more than in 2002. Large producers there include General Cigar's Villazon & Co., maker of Punch and Hoyo de Monterrey; Altadis U.S.A., which has been busy at its Flor de Copan cigar factory, where Gisperts, La Aroma de Cubas and other cigars are made, and Tabacos Rancho Jamastran, makers of the Camacho brand. C.A.O. and the Toraño family also make several cigar brands in Honduras, including the highly successful C.A.O. Brazilia, and the country is home to the Puros Indios and Cuba Aliados brands made by Rolando Reyes Sr.
Altadis had a particularly strong showing. "Honduras was tremendous for us," said Jim Colucci, senior vice president of sales and marketing for the company. "We have two great brands that continue to grow," he said, naming La Aroma de Cuba, which Altadis makes for Ashton, and Saint Luis Rey, which it owns.
"The big part of our growth in 2003 was the success of Baccarat The Game and Camacho," said Christian Eiroa of Caribe Imported Cigars. "Honduran cigar exports have been growing mainly because there are much better cigars being made there than there were two years ago. This is also true of the D.R. and Nicaragua."
Nicaraguan cigar exports, which soared by nearly 40 percent in 2002, couldn't maintain their crazed shipment levels. Cigar shipments from Nicaragua trailed off by 12.5 percent, declining to 33 million cigars. The nation's cigarmakers are still very busy; Padrón Cigars Inc., one of the smaller makers but the one with, perhaps, the highest profile, opened a larger cigar factory in 2003 to make its production process more efficient.
Shipments from Mexico continued their downward slide, slipping 10 percent to 2.5 million cigars.
Some retailers and cigar distributors said in February that 2004 was off to a better start than 2003. Also in Cigar News:
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