The First Family of Tobacco
For decades, the Oliva family of Tampa, Florida, has been supplying tobacco to many of the world's top makers of premium cigars.
It was the summer of 1995, harvest time at La Meca, an Ecuadorian farm where high temperatures, a muggy climate, and fertile soil conspire to make it an ideal place for growing tobacco. As far as the eye could see, green leaves covered the landscape like a carpet. Mist hung heavily in the air, and the dirt felt soft as clay underfoot. Cutting a swath through the field of seven-foot-high tobacco plants, Angel Oliva walked with a proud gait. For him--a Cuban emigrant who started with nothing, revolutionized the post-Castro cigar industry and became a multimillionaire in the process--this lush farmland truly represented a field of dreams.
Oliva was a small-framed man with a shock of white hair. A straw-weaved fedora protected his face from the sun, and he wore his guayabera as a nod to the old country. Jammed between his teeth was his fourth cigar of the day, a custom-made corona, manufactured just for him by his old pal, Frank Llaneza, who happens to head up the venerable Villazon cigar company. It contained Ecuadorian Sumatra-seed wrapper, Connecticut broadleaf binder, and a blend of Honduran, Nicaraguan and Dominican filler. Except for its broadleaf, the cigar's contents were all grown on Oliva's farms.
Age had not diminished this 88-year-old man's passion and instinct for tobacco. He would stay out until after sunset, comparing various plants' leaves, critiquing the manner in which tobacco was carried and picked, debating the differences in seed strains that far younger men could not discern. During daylight hours Oliva would crouch to feel the dirt between his fingers, then move on to a humidified barn where he would get deeply involved in the tobacco sorting operation. The work was tedious but highly valued because it determined where various grades of tobacco needed to be shipped and what should be charged for them. In many ways, sorting is the heart of any tobacco growing operation. Angel Oliva prided himself as one of the best in the business.
Nearly a year later, in early August 1996, at the Oliva Tobacco Co.'s headquarters in Ybor City, a part of Tampa, Florida, Angel Oliva was a blur of puffed smoke and pumping legs. The ever-present cigar was stuck inside his mouth and he drew from it while peddling a stationary bicycle. After getting off his bike, the company founder called over the intercom to his son, John Oliva, heir apparent to the business.
John is a hard-angled man with a softly sweet interior. He possesses a keen interest in computers and an acquired appreciation for tobacco. He trusted Angel implicitly and respected the man in a way that transcended most father-son relationships. They sat in Angel's office, smoking custom-made coronas. "I need you to do something for me," Angel said, speaking the Spanish of rural Cuba. "When you go to Honduras this month, I want you to take care of the Christmas gifts for this year."
"Why now?" John asked. "I don't want to give Christmas gifts in August."
"Look," Angel responded, sounding urgent, "I've always done what I wanted to do when I wanted to do it. This is what I want you to do for me."
John honored his father's request. On Aug. 8 all gifts were distributed; on Aug. 31 Angel Oliva died of cancer. He left behind a self-made empire that provides tobacco to the makers of some of the finest cigar brands in the world--Arturo Fuente, Punch, La Gloria Cubana and El Rey del Mundo all feature Oliva tobacco--and generates more than $8 million in annual sales. Eight-hundred-fifty acres of Oliva-owned farmland are spread throughout Honduras, Ecuador, Nicaragua, the Dominican Republic and the Connecticut River Valley, and more than 3,000 employees currently rely on Oliva Tobacco Company for their livelihood.
Flash forward to the present, as John Oliva, the family's new patriarch, shares these memories with a visitor and his son, Johnito. He and Johnito are sitting at a table in a back room at Bern's Steak House in Tampa. Though the Olivas have adopted many American customs, some Cuban ways persist. At the moment, the most obvious one is the son's respect for the father. Though 32-year-old Johnito is a bright, engaging, passionate businessman who is highly respected in the cigar community, he continually defers to John (just as John had once deferred to Angel). With few interruptions, the younger Oliva allows his father to narrate their family history.
Johnito smiles as his father offers a familiar tale of how he almost wound up far from the cigar business. After majoring in engineering at University of Florida, John wound up working for a computer company and expressed no interest in tobacco. When, in 1968, he seemed too immersed in technology to be satisfied with the family farms, Angel tried to pressure him with an ultimatum: Join the business or else it will be sold. "The old man was a manipulator from the word go, and he pulled off what I consider the greatest charade ever," John recalls. "A gentleman came down from Holland and talked about buying Oliva Tobacco. They bickered about a lot of nitpicky things and he seemed close to making a deal. Then, in 1970, as negotiations were still going on, the company that I worked for got bought out and I was offered a big-time position in Houston. But I didn't want to move to Texas, and I didn't want to see something that my father started from nothing getting sold away because nobody had an interest in it. So I agreed to join him. I spent the next three years with my arms crossed, listening to everything my father had to say. I looked like a bodyguard, but I learned a lot." John turns, gestures toward Johnito, then half-jokes, "My job then was what his job is now." (In 1974, John's brother, Angel Jr., joined the company, and today he remains active as a vice president.)
Fuente Fuente Opus X smoke hovers above the table as John speaks. Considering that the Opus X is made from Cuban-seed Dominican shade wrapper and Cuban-seed Dominican binder and filler grown on the Fuente's land, land once owned by the Oliva family, the question presents itself: Is Connecticut-seed Dominican wrapper a trend? "Most people won't grow Connecticut wrapper there because they need the land for filler," John says. "You can grow Connecticut wrapper in other places like Honduras." Puffing away on the Opus, he adds, "But judging by the success of this cigar, I would say that the future is good for growing Cuban-seed [wrapper] tobacco in the Dominican Republic. The two places are so close to one another that there are similarities between each of their lands."
The two Olivas, notoriously secretive and press shy, slowly begin to open up about their world, gingerly sharing tales about Angel's ambitions and exploits. But before getting too deeply into it, John raises his glass of 1979 Firestone Cabernet Sauvignon for a toast. "This," he declares, "is for the old man."
Like many great cigar stories, the Olivas' begins in the Pinar del Río region of Cuba, the tobacco growing district where Angel Oliva was born on a plantation in 1906. His parents were dirt-poor country people; his father made a living by working other farmers' tobacco lands. Eleven brothers and sisters survived Mrs. Oliva's 24 pregnancies, and after the fourth grade, Angel had to quit school to help the family make ends meet. His first job entailed gathering manure for fertilizer. It was repulsive, back-breaking labor that yielded two cents a bag for the Oliva clan.
At 13, Angel was sent by his rather brutal father to Havana to work at his uncle's general store so he could support the family back home. (One possibly apocryphal story has it that the elder Oliva shot a rifle at Angel's brother; another has him angrily ripping the door handle off of a 1955 Packard as he neared his 90th birthday.) "It was total servitude," says John. "He worked seven days a week and slept in the store. By the time he turned 18, the old man knew that there had to be a better life somewhere else. He came to America because he felt that he could get a fair shake here. He believed that you could get whatever you want as long as you're willing to work."
Crossing the Straits of Florida, Oliva had a fistful of tobacco seeds sewn into his belt, like a talisman that he believed would serve as the key to his Stateside future. But first he had to earn a living, so he worked odd jobs for eight years, including stints as a store clerk and as a tablecloth salesman. In 1932, he married Estela Diaz, a girl whom he met soon after arriving from Cuba and fondly called "Meca." After unsuccessfully trying to run a Laundromat, Oliva hooked up with James Johnston, a tobacco broker with a faltering business of his own.
There were 50 cigarmakers in Tampa at the time--enterprises such as Perfecto Garcia, Diego Trinidad and La Roma--all working with Cuban tobacco. Oliva spoke the language, understood the customs and capitalized on long-standing relationships. He established relationships with growers and manufacturers; he brought Johnston's firm out of debt and into the black. But when Oliva broached the idea of becoming a partner in the company, Johnston turned him down, citing the age difference between the two men. So, with his boss's blessing, Oliva and two partners (long ago bought out) launched Oliva Tobacco Co. in 1934. By the mid-1940s, Oliva's brothers Martin and Marcellino were brought into the company.
Oliva focused his energies on cigar tobacco. "He worked his ass off and knew the product," confirms John. "My dad never had a hobby in his life. He ate, drank and worked tobacco. He smoked five cigars a day. He loved the business so much that I never saw a lot of him." John hesitates for a moment, then adds, "The old man knew what it was like to go through hunger, so when the business gave him a good living, he pursued it. He pursued it real hard."
Through the 1950s, Oliva Tobacco flourished, rising to be among the top tobacco distributors in the world. The Olivas formed solid relationships with Cuban growers; American cigar producers trusted the Olivas completely. The family became known for cutting solid deals and always delivering what they promised.
The elder Oliva established expansive connections that allowed him to broker all types of tobacco. "A farmer couldn't sell all of his crops to a single manufacturer because one wanted wrapper, another wanted filler, a third might want dark tobacco," John says. "The farmers needed someone who was in a position to sell all the tobacco that a crop produces to a lot of different manufacturers. Eventually my father started handling specific farms in Cuba. He would advance money and finance crops; he set up a sorting operation and bought his first tobacco farm in 1958 or '59."
At that time, of course, almost all premium cigar tobacco came from Cuba, and Oliva was thrilled to own a piece of the beautiful island to which he owed his heritage and his livelihood. Then Fidel Castro seized power. "I was visiting Havana [shortly after] Castro came in, during July of 1960," John recalls. "That year was the first year that my father went into Honduras. We founded a farm in La Plata and planted the crop of 1961. The [Cuban] embargo didn't set in till 1962, so we had a jump on producing tobacco outside of Cuba." Reflecting on the political climate, John adds, "Very few people thought Castro was leaning toward communism." Asked what his father thought of the man, John answers without hesitation: "That he was a communist."
Thanks to Angel Oliva's prescience, Oliva Tobacco Co.'s sales exploded. Not only did Oliva have a head start setting up farms throughout Central and South America--in 1961 he invested $900,000 to buy land and equipment and hire Cuban tobacco farmers--but he also was able to plan his final shipment from Havana's ports. "He handled the last tobacco crop from Cuba," which totaled nearly 4,000,000 pounds, says John. "Then he gave 14 or 15 cigar manufacturers the opportunity to buy the tobacco at pre-embargo prices. He never gouged anyone."
Once that supply was exhausted, though, so was the legacy of Cuban tobacco for American consumption. And life became more difficult for Angel Oliva. He had to establish new infrastructures in politically unstable environments. He slept on the farms, instructed the workers, and dealt with risks and discomforts that are virtually unheard of in the United States. He insisted that when the Olivas visit their tobacco farms, they live in the same style as the farmers. "But a general rule of thumb is that if the tobacco is good, then the conditions are bad," says John, echoing lessons learned from his father.
"We were in Honduras once, staying on the farm with a Costa Rican customer and finishing up dinner, when four guys wearing military garb walked in. They put guns to us and claimed to be searching for marijuana--but of course there was none. Once they started searching people, my father stood up and announced in Spanish, 'You cannot do this to us. We are Americans. This will not be tolerated.' Meanwhile a guy had an M-1 in my stomach, and I could see that under his uniform he was wearing jeans and a T-shirt. I started telling my father in English, 'Dad, shut up. These guys are not military.' They robbed everybody except for me, and, once they left, the Costa Rican guy vowed to tell the newspapers about this, to get it reported in The New York Times. My father said, 'Do that and I will never sell you another bale of tobacco. With my wife's nervous condition and everything else, she cannot find out about this.' "
Though the Olivas cling to tradition, there have been some recent changes, including a partnership with Connecticut tobacco producers Calvin Arnold and Ken Chickowsky for growing wrapper in the Connecticut Valley, the purchase of a third farm in Ecuador and the computerization of the business. "We even have computers on the farms," says John. "Our people there take inventory and give us reports on what the yields are. I get my files every day through the Internet, so I can check on all aspects of the operation. I can check the sorting operations and know my inventory. I've been accused of being too hands-on, but I will never take my hands off of the inventory because that controls the business. Knowing the inventory, knowing what my customers want, that is the business."
The nerve center of the Oliva operation is in a nondescript warehouse in Ybor City, that like most other structures in the area, was originally a cigar factory. With windows facing east and west, there was plenty of natural light for the rollers, whose workday once stretched from dawn to dusk. Strolling through the storage space, puffing on an El Rey Del Mundo, Johnito explains that a cooling system was installed to keep the temperature at 55 degrees. "But the humidity is natural," he says, taking in the scent from boxes of freshly picked tobacco leaves. "This is the best humidor I've ever been in; I store all my cigars here and they keep really well. I tend to think that these walls must have been built so that they sweat a little bit."
Although the techniques for storing the tobacco remain virtually unchanged from the old days, just about everything else concerning the business has been transformed over the past decade. Demand for premium cigars is so high that Oliva cannot stock enough tobacco. Johnito insists that he now dreads attending cigar industry conferences and cigar smokers because he is continually bombarded with requests for tobacco that his company cannot provide. Even with new farms throughout South and Central America, the Olivas have a hard time meeting the demand, since it takes more than a year to grow and cure tobacco properly before it can be sold.
According to John, the shortage will continue for another two or three years, until production catches up with demand. He insists that the Olivas are doing their best to facilitate this. Since 1993, "we've more than doubled the size of our production in Ecuador, we're doing contract farming in Connecticut--something that we have not done in more than 30 years--and we're considering growing tobacco in Gadsen, Florida," he says, referring to a richly soiled area near the Georgia border. "Thirty years ago it produced 6,000 acres of shade tobacco, until economics pushed everything off shore. The land is there, man, and the local farmers know tobacco."
Further evidence of the Oliva's recent growth spurt can be gleaned from its numbers: In 1992 the Olivas grew 100 acres of Honduran wrapper and 70 acres of Honduran filler, in 1996 they grew 160 acres and 250 acres, respectively; in 1992 they grew 270 acres of wrapper in Ecuador, in 1996 the number rose to 375 acres; in 1992 they grew 350 acres of Nicaraguan filler, in 1996 it increased to 550 acres; in 1992 they grew 100 acres of filler in the Dominican Republic, and by the end of 1996 the acreage grew to 250. While John Oliva cannot break the growth down by region, he estimates that each acre yields, respectively, approximately 1,000 pounds of wrapper per year and 200 to 300 pounds of binder or filler.
The primary drawback of the current cigar boom, Johnito points out, is that some of the newer cigar makers see little choice but to buy inferior tobacco, while the more established companies feel pressed to release their products prematurely. "The cigars need to be aged just a little bit longer," he says, now sitting in the office that had once belonged to his grandfather, showing off a half-dozen or so Churchills that he is aging. "Some of the manufacturers just don't have the luxury of sitting on the tobacco, and that makes for cigars that don't smoke very well. They'll be good cigars, but they just won't draw the way they should." He holds up one of his young cigars for inspection, then adds, "This looks beautiful and it feels great, almost gummy. But it won't smoke for another six months. Let it sit for a year and it will be even better."
Back in the storage area, Johnito wraps a sample leaf around his cigar and lights it to check how well it smokes. He's pleased with how evenly it burns. While the family clearly owes much of its status to founder Angel's foresight in beating his competitors to the growing fields of Honduras, there is more to the company's longevity than that. "We have good land," Johnito says simply. "The old man knew soil. He found good farms."
John agrees. Then he takes it a step further: "I'll go with a farmer from Cuba to Honduras. He'll start kicking the dirt, looking at it, picking it up. Then he'll say, 'Right here. This is where we will grow the tobacco.' There are some atmospheric conditions which tell you that you can grow, for example, green wrapper in one place but not another. You are dealing with a crop that never comes out the same way any two years in a row. Glacial soil in the Connecticut Valley allows some of the best tobacco in the world to come from there. But try growing broadleaf anywhere else in Connecticut and it won't taste as well. It's the soil. What's the big deal about tobacco from Cuba? The soil. I've been on farms in Cuba where the tobacco is great on one side of the road and no good on the other. About the only thing you can count on with tobacco is that somewhere down the line, something bad will happen: a barn will burn down, a disease will hit, you'll have a hail storm."
One of the worst case scenarios transpired in the 1980s when Hurricane Fifi ripped through Honduras and Nicaragua, bringing blue mold with it--a virus that attacks tobacco leaves, thrives in cold, wet weather, and is anathema to anyone who needs to earn a living as a tobacco grower. "To kill blue mold, we use Ridomil, a preventive chemical made by Ciba Geigy, but the problem is that blue mold's a virus, so it keeps changing," says John. "The only way to eradicate it is to stop growing tobacco for 90 days. We burn the diseased tobacco, plow the fields, and start from scratch. We try to fight it by growing tobacco in stages, and there are some new chemicals out there, but we don't like using chemicals because they can affect the taste of the tobacco." With resignation, he adds, "When the cold fronts come down, you have more of a chance of being hit with blue mold. But nobody can predict the weather."
Tobacco growing members of the Oliva family have learned to take the business' downsides in stride. Despite losing fields during revolutions in Nicaragua, they have returned there and are bringing the embattled nation's crop back to satisfactory levels of quality. "Between the city of Jalapa and the Honduran border [where the best tobacco plantations were], fields were land-mined and barns were burned," explains John. "The foreigners who were technologically oriented have left the country. But the land is still very fertile. Nicaraguan tobacco is of a lesser quality than it once was because people there need money and are moving it out at a faster rate, throwing tobacco into loose-leaf bulks so that the uniformity isn't what it used to be and the leaves break." But the Olivas are not sitting back and letting good growers go bad: "We have Nicaraguan co-ops that we're financing. We are sending over humidification equipment, emphasizing that the curing be done in a slower fashion regardless of the demand for tobacco. The Jalapa Valley is a big area, and a third of it is not being used now. But eventually it will be."
Within the next few years, the Olivas predict that Nicaragua's output will reach prerevolutionary standards. This is an issue of particular interest to Johnito, who stands to reap the most rewards from the rejuvenated farmlands there. As the youngest member of this cigar dynasty, he has a vested interest in the future of the tobacco market, and he's grateful for the current boom in premium cigar sales. "We will probably see some leveling off," he allows. "But there will also be a good, steady, consistent business, similar to the way cigars were prior to the Cuban embargo. I predict that there will be more of a demand for stronger tobaccos and higher quality cigars."
As he climbs into his Land Cruiser and drives to The Columbia, a 92-year-old Cuban eatery in Ybor City that just might qualify as America's original cigar bar, he contemplates the mark he hopes to leave on the company that was founded by his grandfather and computerized by his father. "I'd like to see us growing tobacco in Cuba," he says. "We'd be able to modernize the growing in terms of soil analysis and fertilizer programs and finding out what the soil can take. You know, we'll never go back as long as Castro is there, but after he's gone..." His voice trails off for a moment in consideration of the possibilities. Then Johnito Oliva quietly vows, "It will be awesome."
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