An Interview With Pedro Martín
Pedro Martín, the founder and owner of Tropical Tobacco.
From the Print Edition:
Orlando Hernandez, Mar/Apr 99
Pedro Martín, the founder and owner of Tropical Tobacco, began working in his father's cigar factory in the Cuban city of Cienfuegos in 1936, when he was 15 years old. But he had been in the family's tobacco fields from the age of seven, pulling weeds from among the plants. His family made the El Veguero brand for sale in the province and processed tobacco for the Havana factories, until they were forced off their land by the Cuban revolution.
Martín left Cuba in 1961 and went to work in Detroit for a U.S.-based cigar company, using his expertise with tobacco to become a blender and taster of cigars. After nearly a decade of working for others, Martín founded his own wholesale cigar tobacco leaf company, and then, in 1978, he started Tropical Tobacco. The company began with the Solo Aromas brand, then introduced such cigars as Particulares, Cacique and Maya. Later on, Tropical launched Don Juan, and then to commemorate the 500th anniversary of Columbus's discovery of America, it began making V Centennial cigars.
Martín admits that his company wasn't prepared for the huge boom in cigars that began in 1992. It wasn't until late 1996 that he was able to begin producing cigars in large enough quantities to meet market demand. Of course, by that time, the market peak had passed, and recently he has cut back some of his expansion plans. But in a recent interview with Gordon Mott, managing editor of Cigar Aficionado, Martín expressed his long-term commitment to the premium cigar business and his optimism about renewed growth in the marketplace in the near future.
Cigar Aficionado: Where did you settle after leaving Cuba, and why did you choose to go there?
Martín: When I left Cuba in 1961 with my family, I went straight to Detroit because I used to have a customer there, a cigar company. It was called DWG Cigar Corp. They were buying tobacco from me in Cuba, where I had been in the tobacco business for years. I went there looking for a job. They hired me as an assistant tobacco buyer and also to help out on the blending panel. I worked there for four years.
CA: What did you do there?
Martín: In the beginning, I worked in the office. My job was translating letters from suppliers all over the world who were trying to find replacements for Cuban tobacco in the cigars they exported to the United States. They wrote in Spanish and I translated the letter into English. The company wrote back in English, and I'd translate the letter into Spanish. The company also put a lot of cigars on my desk with numbers on them, and a comment sheet to tell everything I felt about the cigar that I was smoking. In the beginning I didn't know what the hell I was doing. I knew how to smoke a cigar. I was a smoker. And, I used to blend cigars in Cuba. But I didn't really know what to say about cigars, especially a short-filler cigar.
CA: Were these all short-filler cigars that you were tasting then?
Martín: In the beginning, yes.
CA: You were one of the original blind tasters.
Martín: In the beginning I laughed about it. Because I didn't know what the hell to do. Nobody told me what to say about the cigars. I'd say, 'I like it, I don't like it, too strong, too mild, it's a little bitter.' You know, giving your impression about the cigar you are smoking. But at first, you're not used to doing that. Later on, I also was the tobacco buyer. One of the reasons they hired me was to find a replacement for Cuban tobacco because they had been using a lot of Cuban tobacco before the embargo. They were blending Cuban tobacco with Puerto Rican tobacco. At that time there was a lot of Puerto Rican available. That was the main blend. Later on we started buying tobacco from the Dominican Republic, from Central America, from Brazil, from Columbia, from different places all over the world. That was the place where I learned how to really create a cigar blend. When I started, I didn't know how to do it, because you have to educate your palate. By my last year there, my tasting skills were so good they didn't want the panel to make any recommendations without me. So, I really learned how to blend cigars right here in the United States. Can you imagine that? I knew a lot about tobacco in Cuba, of course. That's the main thing. If you know tobacco, you know how to cure tobacco and how to make a simple blend. But I really learned how to create a blend here.
CA: When and where did you start working in tobacco in Cuba? Where were you born?
Martín: My father, Antonio Martín, and my uncle, Matias Martín, were in the cigar business. That was the family business. I went to school in the morning and worked in the factory in the afternoon. It was 1936; I was 15 years old. But I used to work in the field when I was 7 or 8 years old.
CA: Doing what?
Martín: Cleaning the plants, pulling off the [bottom leaves]. Keeping out the weeds.
CA: Where were your family's fields?
Martín: In Manicaragua. That was in the south of Villa Clara province, about 18 miles from Santa Clara. Our factory was in Cienfuegos, about 25 miles from Manicaragua, where I was born.
CA: And your family grew cigar tobacco?
Martín: Yes, cigar tobacco.
CA: Did your family also manufacture cigars in Cuba?
Martín: I remember one, El Veguero. I think the Cubans make a brand called Vegueros now.
CA: How many cigars were made in your factory then?
Martín: We used to have anywhere from eight to 15 cigarmakers. We made usually about 2,000 to 3,000 cigars a day.
CA: Did you make a particular size or shape?
Martín: We didn't make that many sizes. We made a Media Breva, the cheapest one. If I remember right, the size was 4 3/4 inches by 42 ring gauge. We made the Breva, which was about 5 1/4 or 5 1/2 by 44. We made fumas [called Casadoras] with a twisted tail, which was 6 by 44.
CA: And how much did those sell for?
Martín: About two cents each. We also made the Petit Cetro. It was 5 inches by 38 ring gauge. We sold most of these cigars in boxes of 25. The Petit Cetro and another one called Climas also were sold in boxes.
CA: Were they sold all over Cuba?
Martín: No. It was mainly in the Las Villas region.
CA: So you couldn't even buy them in Havana.
Martín: No. During the Second World War, we used to make a cigar called Commandos for the American soldiers.
CA: Were they just small cigarettes or small cigars?
Martín: Cigars. About 5 1/4 inch by 42, something like that. We made tons of those, and we sold them all. They were all long filler.
CA: You continued to work in the factory and in tobacco until 1961, is that correct?
Martín: Yes. During that time, I continued making cigars and working with my uncle. My uncle was in charge of the factory and my father was in charge of purchases, plus tobacco curing and the selection of tobacco.
I remember something that makes me laugh about the problem we have with teenagers smoking in the United States today. I smoked cigarettes and cigars as soon as I started working in the factory. But I could not smoke in front of my uncle or in front of my father. One day my father, when I was about 17 or 18 years old, found me smoking a cigar. And then you know I was afraid. But he said, "You're a man now; you can smoke." And from there on I started smoking every day. I didn't smoke too much, you know. A couple of cigars a day.
But I was involved with tobacco. You get involved in tobacco when you love this business. It's a dirty business, you know. Dirty means you have to dirty up your hands and your clothes and everything. If you don't love it, you have to get out.
CA: In 1950, when you established Tabacalera Martín, were you selling tobacco that your family grew in Manicaragua or were you buying leaf tobacco from all over the country and selling it to the factory?
Martín: We mostly used to buy tobacco from other growers from Villa Clara province, making, sorting and curing the tobacco, selling it to both Cuban- and American-owned factories.
CA: But your tobacco always came from Villa Clara province?
Martín: Yes. Later on I started buying tobacco in the Pinar del Río--curing, stripping and selling the tobacco in Cuba and to factories in the United States in Tampa [Florida].
CA: At that time in the 1950s when you had Tabacalera Martín, were you selling to some of the people who today are part of the American cigar industry, such as the Fuentes, Frank Llaneza or Danny Blumenthal?
Martín: I used to sell tobacco to Perfecto Garcia and Garcia y Vega before Frank Llaneza acquired it. He took over in the late '50s or early '60s. I used to sell to the Corral family and to Universal Cigar, which today is part of Swisher.
CA: What about the Menendez family?
Martín: I used to sell to them. I loved those people. The father and uncle of Benjamin Menendez [of Tabacalera España today] were my best friends in Cuba. And they mean a lot to me. They are like my own family.
CA: It comes to New Year's Eve, 1959...
Martín: Nightmare. It was a nightmare.
CA: Did you feel that way at the time Fidel Castro took over, or did you believe that there was a chance that things were going to improve at first?
Martín: I was a young fellow at the time and I felt that it'd be good for Cuba, in the beginning. We needed to change something. Most of the politicians in Cuba were corrupt. I really felt happy about the takeover of my country. But pretty soon I found out that they were not doing the right thing.
CA: How soon did that happen?
Martín: Castro took over in January 1959, and in February I already began to question what he was doing. He was taking everything from everybody. He would steal everything people had, even a small business they had their whole life. He took it away. I felt it was not right.
CA: Did your family still own tobacco farms at that point?
CA: When were they confiscated?
Martín: In 1961. They confiscated our tobacco land, they confiscated our warehouse where we had the sorting and stripping operation.
CA: Was your entire family still in Cuba at that point?
CA: Were you married?
Martín: I was married in 1950.
CA: Did you have children by 1961?
CA: Did you all leave together? And when did you leave?
Martín: No. I left on September 15, 1961.
CA: Was it difficult to leave at that time?
Martín: For me it was not difficult because I used to have a U.S. visa that allowed me to enter the United States anytime I wanted to. I could stay here for 30 days in a row, go back to Cuba, and back and forth several times in a year. I had that visa. But my family did not. So I had to come first, and then my family went through Jamaica. They spent about 30 days over there. Finally I got them from Jamaica to here.
CA: And at that point you already knew you were going to go to Detroit, is that right?
Martín: Yes. It was the DWG Corp. I had sold tobacco to them in Cuba for a few years, and then when I came to Detroit they gave me a job. It was Alfred Edelman, who was the DWG tobacco buyer. He's the uncle of Jerry Edelman, who works in the business today. He helped me a lot.
CA: You worked there for four years. Why did you leave?
Martín: I hated the cold weather [laughter]. I used to travel a lot, all over the country, and I remember one time I was in Puerto Rico and I flew back to Detroit right in the middle of the winter. I didn't have any clothes with me. My wife came to the airport to pick me up and she brought me a coat. We started driving and a couple of miles later, my tire blew out. It was snowing, the wind was blowing. I had gloves, but my hands just couldn't [grip the jack to change the tire]. I went to a gas station. While they were fixing the tire, I found out it was 18 degrees below zero. That was it. I had to move.
CA: After DWG you went to work for the Dutch company Koch Scheltema N.V. Where were you stationed?
Martín: I was living in Miami, but I used to work in different places. The first place that they sent me was Colombia. I set up a company in Cartagena called Tabarama de Colombia. I used to buy tobacco for it. From there they sent me to Brazil. From Brazil they sent me to the Dominican Republic and then Central America. They sent me over there to set up all the companies so they could cure, sort and pack tobacco. I was like a consultant. I moved around a lot. I would be in Cartagena for a month at a time, and then I'd come to Miami to see my family. I did the same thing in the Dominican Republic and Brazil. I was very tired of traveling.
CA: You worked for them for six years, and that's when you started Martín Tobacco?
Martín: At Martín Tobacco, we used to buy tobacco mainly from Central America and the Dominican Republic, treat it, cure it and sell it to different manufacturers. A lot of my friends in the cigar industry would say, "I need some tobacco from Nicaragua, from Honduras. Can you get it for me?" And then I went over there, bought the tobacco and prepared it for sale to them.
CA: How big was this tobacco wholesale operation?
Martín: It was a real small company, but later on I joined up with P. M. Gonzalez of Gonzalez & Sons in Tampa, and we created a bigger company.
CA: How many bales of tobacco were you processing every year?
Martín: I'd say, altogether, about 5,000 bales, between Central America and the Dominican Republic. In 1971, we also started growing wrapper tobacco in Nicaragua.
CA: Did you have any partners?
Martín: I had three partners: P. M. Gonzalez, Juan Francisco Bermejo--who works with JR Tobacco now--and Rene Garcia Pulido.
CA: Were Garcia Pulido and Bermejo Nicaraguan or Cuban?
Martín: They were both Cuban.
CA: Where was the wrapper operation in Nicaragua?
Martín: In Estelí. It was natural wrapper and it was beautiful.
CA: Which cigar companies were you selling to?
Martín: Mostly Consolidated Cigar.
CA: Did you sell any of this wrapper to the Joya de Nicaragua?
Martín: No. That was owned by Gen. Anastasio Somoza, and they were using a Cuban-seed wrapper.
CA: Were you using Connecticut seed?
Martín: Yes. We also sold a lot to the Canary Islands' factories.
CA: Did you and your partners lose any property or business when the Sandinistas took over in 1979?
Martín: No. We had ended our partnership [in 1974], after about four years. I tried to fix the business but I couldn't. We started fighting among ourselves. We broke up.
CA: How much wrapper leaf could you grow? How many bales?
Martín: We used to grow over 2,000 bales worth, on about 200 acres. That was a hell of a business at that time.
CA: Would you ever consider going back and growing wrapper leaf again in Nicaragua?
Martín: I would like to, but I'm too old for that.
CA: But do you still use Nicaraguan tobacco in some of your cigars?
CA: Has Hurricane Mitch affected your supply at all, or do you expect it to be affected after this season?
Martín: The only thing which I know so far is that the crop is going to be late. I expect to get decent tobacco from there. I hope so.
CA: Is the tobacco you buy from Estelí or from the Jalapa Valley?
Martín: From Estelí. They're planting crops there.
CA: When did you start Tropical Tobacco and why?
Martín: In 1978, I was in Tampa working with P. M. Gonzalez. I used to handle a lot of tobacco from Honduras and Nicaragua. I saw some factories. I just got excited about being in the cigar business again.
CA: But it had been 20 years or more since you'd made cigars, right?
Martín: Right, but I fell in love with the business again.
CA: When you started Tropical Tobacco, was the factory here in the United States?
Martín: No, we started buying cigars from the people at a factory in Santa Rosa de Copan in Honduras. It was called Flor de Copan. All the tobacco was from there. Our first brand was Solo Aromas. It was a bundle brand--it still is.
CA: Where was it sold?
Martín: In the United States. But it was not well known.
CA: Did you have your own sales staff or did you use wholesalers?
Martín: I used wholesalers.
CA: Did you have national distribution?
Martín: Not at that time. That took time. To have a national distribution, you've got to have a lot of cigars.
CA: How many cigars did you import that first year?
Martín: Not even half a million: 450,000.
CA: And they were all Solo Aromas?
CA: What was the second brand that you started?
CA: That was made in Honduras also?
Martín: Yes. Then we started Lempira and Casanova. Casanova was a great brand; we used to make it in the Canary Islands.
CA: Do you still own that brand?
Martín: Yes, but I took it out of the market. That was the result of what happened with Tabadom [the Dominican cigarmaker, formally known as Tabacos Dominicanos]. Tabadom was making the brand for me in the mid-1980s. When the Davidoff people came along [to Tabadom], they started getting the tobacco that we had been using in Casanova. They took it out of my cigar. I had to liquidate because there was not enough [quality tobacco for] my cigars.
At the time, I was selling about 40,000 Casanovas a month. We had started making the brand in the Canary Islands. Then one day, in the early 1980s, the suppliers raised the price 25 percent from one day to the next. And you know at that time if you tried to raise prices, it was a disaster. So, I took it out of the Canary Islands and we started making it with the same blend in the Dominican Republic at Tabadom. And in the beginning it was good. But in 1989 Tabadom changed the blend. They changed everything.
CA: Let's go back a second. So Tropical Tobacco starts in 1978. You developed Solo Aromas, Lempira, Maya, Cacique and Casanova. At that point, how many cigars did you import when all five brands were in production?
Martín: About 2 million.
CA: And they were made at Flor de Copan?
Martín: No. By that point, we were making them mainly at a factory in Danlí, Honduras, and a lot of them in the Dominican Republic, at Cotasa [Compania Tabacalera S.A.], which was owned by Tabacalera [the Dominican government tobacco concern]. We were making Cacique there. They also made a brand there called Villa Real. I had it on an exclusive basis in the United States. Then, in 1984, a group of people, including Hendrik Kelner, started Tabadom. And I was a partner in that factory. At that time I owned 10 percent. Everybody owned 10 percent. It was beautiful to me. But then they started issuing more stock. Davidoff ended up with the company. I still have my original stock.
CA: Did you produce all your brands at Tabadom?
Martín: I made some brands in Nicaragua. But I was with Tabadom from 1984 to 1989; six years, and I bought 70 percent of the factory's output.
CA: Wasn't Avo started at Tabadom in 1987? What other brands were made there?
Martín: Griffin, Avo, and we produced Cerdan also. And we produced Ashton in the beginning. When we first set up this factory in 1984, Kelner, who became president of the company, was not in the Dominican Republic. He stayed in Colombia for two years, working in a cigarette factory. We were doing the job ourselves, and we were doing fine.
CA: You started making the Ashton brand in 1986, is that right?
Martín: We started Ashton then. For two years, we made Ashton.
CA: Did the owners of Ashton pull their brand from Tabadom when Davidoff came in? Or had they left before that?
Martín: Before. They had had problems with Kelner. We [Tabadom] had a big fight with the Ashton people. But I was a minority stockholder and I couldn't do anything for [Ashton owner] Robbie Levin, and he knows that.
CA: How many cigars were you making in the Dominican Republic at Tabadom, and how many were you importing in total to the United States?
Martín: I used to buy about a million and a half cigars out of their production of 2 million, and I was importing about 2 million or so because I used to buy from Honduras and the Canary Islands, too.
CA: In 1989 you were aware the cigars that you were getting from Tabadom had begun to deteriorate in quality. What did you do and where did you go?
Martín: In the beginning I didn't do anything much. I just started making brands in Honduras because I had confidence in the people there. I could work with the people there better than at Tabadom. I started making V Centennial in Honduras and Don Juan in Nicaragua.
CA: Both of those brands were released prior to 1992, right?
Martín: Don Juan in 1988 and V Centennial came out in 1992.
CA: Was Don Juan a direct response to what happened at Tabadom? Did you decide to go to Nicaragua and start making the cigar there?
Martín: Yes. And, the same thing was true about V Centennial. I had gotten the idea for V Centennial in 1988.
CA: Who made Don Juan in Nicaragua at that point?
Martín: It was made by Nestor Plasencia in Ocotal. And V Centennial was made in Honduras by Plasencia also. I was there and had control of the tobacco. He didn't have the tobacco. I bought the tobacco and put it into the factory, and they used my blend in my cigar. I had a lot of control in the beginning.
CA: Many manufacturers started out with one or two brands. But you created five. What was your thinking, what strategy did you have? Why did you create five brands instead of just one or two?
Martín: The United States was a different cigar market than today. At that time, I figured out that if I had more brands, I had more chance to enter the market, to get on the shelves at retailers. The cigars came in different price levels, but mostly middle or lower price.
CA: But V Centennial was a premium-priced cigar.
Martín: From the beginning. When I created V Centennial in 1992, I was thinking of selling maybe 100,000 cigars. And the first year I sold 250,000. And in the second year I sold over a half a million, so that was a brand that exceeded my expectations.
CA: If you sold half a million in 1993, how many did you sell in 1994?
Martín: In 1994 and 1995 I could not sell that many more because I did not make that many more. I could have sold millions in 1995 and 1996.
CA: How many are you making and selling today?
Martín: In 1997, we sold over a million Don Juan and more than 600,000 V Centennial. In 1998 I have not made the figure yet, but I know it's going to go down about 40 percent. Not because of the quality but because of the market.
CA: Do you see 1998 going back to a sales level of 1994 or 1995?
Martín: I would say about 1994, yes.
CA: Will you still sell about 2 million cigars total?
Martín: Yes. We are still selling a bit more than 2 million. But last year, we sold over 5 million.
CA: Do you think the premium market will come up again after the glut is over?
Martín: I am now making the best cigars in my life since I made them in Cuba. The production demands are less now and I have more time. I have the same filler but I'm aging it for a longer time. I've got the same blend but with all good rollers. I am making a hell of a good cigar now. It is a shame that I am not selling that many, but I am making a good cigar, no question about it.
CA: Let's go over the production of each of your brands. Let's start with Solo Aromas. How much do you sell on an annual basis?
Martín: I have not sold Solo Aromas for about a year. Solo Aromas was made in Honduras. Nestor Plasencia refused to make the Solo Aromas for me because it was a bundle brand and there was no margin on it. He wanted to make more money. He listed the price in such a way that I couldn't afford any longer to make the cigar, so I took it out of the market. I started making Solo Aromas again about two months ago in the Dominican Republic at our factory [which opened in early 1997].
CA: And the Maya?
Martín: I am still making Mayas in Honduras. In 1998, we made about 200,000; 1997 was half a million.
Martín: In 1997 was over 500,000, in 1998, I would say about 300,000.
Martín: Lempira is down quite a bit. I was smoking a Lempira the other day to find out why that is, why we are not selling it. A couple hundred thousand at most.
CA: And Don Juan in 1997?
Martín: Don Juan is still the number one. I don't know how many--1.2 million in 1997, more or less.
CA: And in 1998?
Martín: Maybe half that.
CA: You've instituted another change. You started a factory in the Dominican Republic in 1997.
Martín: Yes. In February 1997, we started to teach people to make cigars because we could not find enough good rollers. We had to teach the young fellows how to make cigars.
CA: So you started producing cigars in your own factory in May 1997. Wasn't it about that time that other factories began to close?
Martín: They closed a lot of factories between October 1997 and May 1998. Maybe a hundred factories closed down in the city of Tamboril alone. Most of them were just in houses, but they were cigar factories.
CA: How many rollers do you have working right now?
Martín: Around 40.
CA: How many could work in the factory?
Martín: I can get up to 300 or 400 if I want to. You can make 50,000 cigars a day over there, easy.
CA: And how many are you making right now?
Martín: We are making about 8,000 to 10,000 a day. Generally we are going to increase by another 4,000 a day because we have had a lot of business outside the United States. I think in 1997 we got up to about 30,000 per day, which was our peak.
CA: How many rollers were working at that time?
Martín: One hundred and sixty-five.
CA: And you make Don Juan and V Centennial there, is that right?
Martín: Don Juan Platinum to start, and we brought in V Centen-nial later.
CA: Where is the factory?
Martín: Santiago [Dominican Republic]. Right in the middle of the town. It is a big building. A beautiful building. It used to be a tobacco warehouse. Then they turned it into a clothing factory. It's two stories high, 70,000 square feet. If you count the office and all the other areas, there is more space, but that's the main part. It is computerized. It's one of the best buys in Santiago.
CA: Let's go back to 1992. You had just launched a new cigar brand and this magazine hit the street. What did you think at that point? You had been in cigars your entire life; did you expect what happened to happen?
Martín: As a matter of fact, I was disappointed with the business at that point. The business did not grow. I tried different tactics. I know I was making a good cigar and bingo--1993 and '94 were worse than the 1980s for me.
CA: You were making about 2 million cigars.
Martín: At that point, two and a half million. I did not increase my production until 1995 or 1996.
CA: Was that because you didn't think the boom would continue?
Martín: I was cautious at first but I thought it would last a little longer than it did.
CA: Why did you start your factory?
Martín: Because I couldn't get enough production out of anybody. I tried to work with Tabadom. We tried to get 3 million cigars a year and not to open my own factory. I wanted to work with the factories. But they all had too many commitments. Even people who came in as customers in the last couple of years, the factories were making more cigars for them than for me. And, they started charging more, too. That's when people like George Hamilton came around, and all these people started to pay enormous amounts of money for cigars. I don't know why they did it. I think there were two reasons that we started the factory: one was because of the demand, that you could not get enough cigars, but the other was quality. The quality was dropping tremendously, both in the Dominican Republic and Honduras.
CA: Didn't a lot of factories have quality control problems?
Martín: Yes. They were just not using good tobacco. They were putting out cigars that should never have left the factory.
CA: How do you feel about the business today?
Martín: I am a little optimistic. I think the business is going to be good again. It's not likely to be a boom again, but it's going to be a real good business again, no question about it. Absolutely sure about it.
CA: Do you have any prediction when that might happen?
Martín: Maybe in a few months, maybe a year, maybe more; I do not know. That is a million-dollar question.
CA: Do you see your international business as a way to get through the tough times here?
Martín: Yes. We are making more contacts outside of the United States. That's where our future is. We have started making Tropical into an international company.
CA: How many cigars do you expect to sell through the international division in 1999?
Martín: According to the people involved, they claim they can sell 3 million cigars.
CA: Which brands are you going to sell outside the United States?
Martín: We are going to sell V Centennial, Don Juan, Cacique and maybe Maya.
CA: And which are the primary markets that you are going into?
CA: Any particular country?
Martín: Germany and Austria. And then maybe Spain, too. And then in the Pacific we want to get into Japan and get into China. We have connections. Not us--the people who work under us.
CA: Let's go back to your roots. You were first and foremost a tobacco man. Tell me, in your own analysis today, where the best tobacco is being grown. How do you see it changing, now that a lot of land that went into production over the past five years will be coming out of production? Where should people be focusing on tobacco?
Martín: Well, there are some countries that are growing good tobacco. First of all, the Dominican Republic is growing good
tobacco, no question about it. They have some areas over there that are good. But the problem there is the farmers. They are not used to working with tobacco like the Cuban farmer.
CA: Do you think the Dominican farmers are improving?
Martín: They are improving, but little by little. And the first thing they have to do is to make different kinds of sheds to cure the tobacco. With these open sheds like they have over there, the tobacco gets wet. But they got good tobacco. Nicaragua has good tobacco, too. And there's some good tobacco in Honduras in the Jamastran valley. We went to Costa Rica a little while ago, and we saw some excellent tobacco there, too. But as I said in Nicaragua, they have a lot of sections where the tobacco is the same as Cuba.
CA: Do you think they will be able in Nicaragua to get back to the level that they were in 1978, before the revolution?
Martín: I hope so. But I tell you very frankly, for blending, I like the Estelí tobacco better than the Jalapa. You blend that with Dominican and it is a perfect blend. I don't like the tobacco in Jalapa to blend with the Dominicans.
CA: Do you still own tobacco fields?
Martín: No, not anymore.
CA: Do you have any plans to start growing your own tobacco?
Martín: No. We get a good farmer and we try to figure out the tobacco, and if the cigar is good, we make a contract with the farmer and deliver it. We check what they are doing with the tobacco. We also buy from wholesalers.
CA: Have prices come down for tobacco?
Martín: Some prices have come down, but the problem is that manufacturers and wholesalers bought a lot of tobacco in the beginning. They paid high prices for it, but it was not the best tobacco. There's still a lot of tobacco out there, but a lot of bad tobacco. It was tobacco grown by people who didn't know what they were doing. We quit buying tobacco for a while in the Dominican Republic.
CA: Let's talk a little more about the future of Tropical Tobacco. Are you going to launch any new brands? What's the plan?
Martín: We're going to concentrate on the brands we have. We've got enough brands. We have about two or three brands that we've registered and that aren't in the market right now, like Casanova. With brands today, and cigars becoming like any other item, you have to do a lot of advertising, otherwise you don't sell. So the more brands you have, the more money you have to spend on it. So we have to concentrate on two or three brands, otherwise we will get lost.
CA: Do you see Don Juan remaining your largest seller, and V Centennial the second?
Martín: I would say so.
CA: Do you think that that brand mix will remain the same over-seas also?
Martín: Yes. We will concentrate on these two or three brands. I think 1999 is going to tell a lot about our company. It may be that one of the other brands or one of the less strong cigars may do better in some country than we'd expect. So you never know. We have a lot of brands registered.
CA: Casanova is a great name, too.
Martín: And eventually we should start it. There is a lot of capacity in this new factory, but if the boom had lasted a little longer, we may have done something in Honduras or Nicaragua because of its much cheaper labor. The Dominican Republic is getting expensive. But eventually, if we do well in the rest of the world, especially in Asia, then we will have to use it to keep up with that demand. Cigar smoking is improving in the rest of the world. People are smoking more cigars, no question about it. Premium cigars, not cheap cigars.
I think a lot of people are beginning to notice that the differences between Cuban cigars and cigars [made in the Dominican Republic, Nicaragua and Honduras] really are not that huge, and the prices are just unbelievable. We went to Geneva to conventions and I saw the Cuban people were there. They had some people making cigars there. It was a beautiful show. But then, we had a dinner, and everybody went. I had about 30 cigars in my pockets and gave them away to people around me. Then the Cubans gave cigars to everybody, including Partagas and Romeo y Julieta. They were lousy. They were very crappy. I am Cuban and I didn't know what to say, because I don't like to talk against my country, my motherland. So, people started smoking the Cuban cigars, and then later on, some of the people I gave cigars to came around to me and pulled out my cigar, saying it was better than the Cuban. Imagine that. I don't think my cigar is going to be better than a good Cuban cigar. A good Cuban cigar is still better than my cigar, no question about it. Not just my cigar, but any cigar; a good Cuban cigar is better. But these were lousy Cuban cigars.
CA: Do you think U.S.-focused manufacturers have an opportunity to build a market for their cigars in markets that traditionally have been dominated by the Cubans?
Martín: I would say so.
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