When Fidel Castro threw Cuba's cigarmakers out of their factories, he unwittingly re-created an industry
From the Print Edition:
10th Anniversary Issue, Nov/Dec 02
Twenty soldiers stood at the entrance to Carlos Toraño Sr.'s tobacco farm in Pinar del Río, Cuba. They were the army of the revolution, the vanguard of Fidel Castro. It was 1960, doomsday for Cuba's cigar industry. The head soldier told Toraño that his property and tobacco warehouses were no longer his. It was time to step aside. Toraño was an imposing man, 6 feet tall and some 215 pounds. An opera singer, a tenor, he spoke in a loud, booming voice. Five hundred of his workers stood behind him as he made his stand on the farm called Esperanza, Spanish for hope. "This is a private farm," he shouted. "You cannot come in." The standoff at the gate lasted three days,
but ended when the soldiers threatened Toraño's workers, telling him their blood would be on his hands. "People will die," they said. "My father," says Carlos Toraño Jr., who was 17 at the time, "decided to go."
All over Cuba, similar scenes were unfolding. Soldiers seized Fernando Palicio's Hoyo de Monterrey factory, the home of Punch, Belinda and Cuba's greatest double coronas. Four men in a jeep drove up to the offices of the Quesada family business, brokers of Cuban tobacco since the 1880s. The Communists sealed their safe, claiming it in the name of the revolution. On September 15, 1960, Castro plucked the greatest gems from Cuba's cigar crown. At 5:30 p.m, soldiers entered the H. Upmann factory, the home of Montecristo, and took it from Alonso Menendez and Pepe Garcia. An hour later, soldiers marched beneath the famed marquee of Partagas, taking the fabrica from Ramón Cifuentes, the dashing cigar man with a passing resemblance to Douglas Fairbanks Jr. "They came inside and said, 'We're here to intervene the company,' " Cifuentes recalled in 1991. "And they didn't allow me to take anything from there."
That day, Cuba seized 16 cigar factories, 14 cigarette plants and 20 tobacco warehouses. Torn from their businesses, their bank accounts frozen, Cuba's tobacco giants were rendered paupers. The plunder was universal, but it was particularly bitter to Toraño Sr., who in 1957 had given Castro 100,000 pesos -- worth $100,000 at the time -- to finance his battle against the dictator Fulgencio Batista. Now the man he had bankrolled was taking everything.
In his 1999 book Cigar Family: A 100 Year Journey in the Cigar Industry, Cuesta-Rey's Stanford J. Newman, now 86, recalled the day in a different fashion. "Castro himself showed up at Carlos Toraño's office in Havana," wrote Newman. "Accompanied by a soldier brandishing a machine gun, Castro barged into Carlos's office and confronted him. 'We are taking over your business,' Castro said. 'Listen, Fidel. I've been a good friend to you. Remember how I always sent money to you up in the mountains? Please don't do this to me.' 'You're just a damn fool,' Castro said. 'Now get out!' "
In the days, months and years that followed the plunder, the cigar barons of Cuba fled their mother country, settling around the world. There was no Cohiba. Americans had never heard the name Macanudo, Padrón cigars didn't exist and only Ybor City, Florida, locals had ever smoked an Arturo Fuente. Cuban seeds had yet to be planted in Central America.
From this loss, an industry was reborn. The exodus made the non-Cuban cigar industry, spreading Cuban-seed tobacco around the globe and turning cigarmakers into chefs forced to blend foreign tobaccos into new creations as they tried to re-create the taste of their lost home.
Fooled by Castro
Castro seized Cuba on New Year's Day, 1959, and many saw him as a savior. "I was in Cuba when Fidel Castro came down from the hills. He looked like he was Christ," says Frank Llaneza, the patriarch of Honduran Punch and Hoyo de Monterrey cigars. "Everyone was very happy. That changed very quickly."
"It looked as though he was being a democrat, saving the country from Batista," says Edgar M. Cullman, 84, chairman of General Cigar Co. Toraño Jr., now 59, agrees: "Ninety-five percent of the population in Cuba thought that Fidel would come in and be a democrat. He had never sold himself as a socialist or communist."
Though he later revealed himself as a communist, Castro showed a knack for capitalism by trying to recruit some of Cuba's cigar elite. The government asked Cifuentes to run all of Cuba's cigar factories. "They asked me to stay," said Cifuentes. "They offered to give me all the control of all the factories. I said no." Days later, he left Cuba for New York City.
Silvio Perez, who had managed several tobacco farms owned or operated by the Toraños, was offered a job running fields under the Castro regime. He, too, declined, and was given 24 hours to leave.
Most of the exiles left Cuba with nothing, or close to it. Menendez had $7 in his pocket when he emigrated to Miami with his wife and children, and lived in a house with 10 other family members, until their landlord kicked them out at Christmastime. Perez washed cars. Cifuentes' wife took a job working at Bloomingdale's.
The confiscations came in waves. "There were different laws that confiscated different things at different times," says tobacco grower Nestor Plasencia. His family owned two farms in San Luis, Cuba, until October 1963, when a government official and a group of soldiers arrived to claim their 2,500 acres of land. "The only thing they let us keep was our house," says Plasencia, who was 14 at the time.
Americans may have had less interest than would be expected in what was happening to the cigar brands produced in Cuba.
America of the 1960s was a nation that lived on Cuban tobacco but smoked very few cigars that were actually rolled in Cuba. Most of the cigars were made domestically, with Cuban tobacco as a sole or prime ingredient.
"Back in those days, Havana cigars weren't the big sellers," says Sal Fontana, vice president of sales and marketing for Caribe Imported Cigars Inc. and a 51-year veteran of the cigar business. "Domestic cigars were 95 percent of the business."
Americans smoked around 7 billion cigars in 1960, more than a billion more than in 1950. Most of the cigars were green, with candela wrappers. The popular size was 6 1/2 inches by 42 ring, a lonsdale. Cigar factories were operating in Tampa, Florida; Trenton, New Jersey; Owensboro, Kentucky; and elsewhere. A man could walk into a store that sold cigars -- an intersection on Manhattan's Seventh Avenue might have had four shops, one for each corner -- drop a quarter on a counter, and leave with a top-quality Clear Havana, made entirely from Cuban tobacco in the United States. For less money, he could buy a cigar with Cuban tobacco on the inside, wrapped with a Pennsylvania wrapper or binder, or perhaps a Connecticut wrapper. If he were a Rockefeller, he would spend more. "The biggest selling Cuban cigars were three for a dollar," says Sherwin Seltzer, who began selling cigars in Manhattan in 1958, right out of college. "They had cigars that sold for $1, but you had to be a millionaire to buy them."
Faber, Coe and Gregg, Seltzer's employer, was the leading distributor of Cuban cigars, and a force in the industry. "Faber was king," says Mark Goldman, a longtime cigar retailer and the owner of House of Oxford Cigars. "A Faber salesman walked into your store, you stopped what you were doing and took care of him, because you needed him more than he needed you."
Tampa cigarmakers warehoused their tobacco in Cuba and imported it by boat on a regular basis. In 1962, Stanford Newman, now the chairman of the J.C. Newman Cigar Co. and then the owner of one of the biggest cigar companies in Tampa, was waiting on a $500,000 shipment of Cuban tobacco. He had just secured a letter of credit from the Royal Bank of Canada, one of the few banks still doing business with Castro's Cuba, when he received a telegram from the secretary of state announcing that President John F. Kennedy had just signed the Cuban embargo. He was able to stop the shipment -- and save his half million dollars -- but now he was cut off from his tobacco supply and sitting on less than a two-year inventory. He wasn't alone.
When Kennedy banned Cuban products, America's cigarmakers found themselves cut off from their supply of raw materials. It could have been worse.
The aptly named Angel Oliva Sr., a Cuban workaholic, tobacco broker and farmer, bought precious time for the American cigar industry by purchasing most of Cuba's 1960 tobacco crop, some four million pounds of tobacco. (An equally impresive purchase was made in 1959 by another tobacco legend, Heller E. Meerapfel, of M. Meerapfel Shne A.G., who bought almost all of Cuba's crop that was for use outside of Cuba and the United States.)
"Angel Oliva knew this would happen," says Lew Rothman, 56, owner of JR Cigars, who was working at his father's cigar store when the embargo was signed. "He brought in the last big shipment of Cuban tobacco, and he divided up that shipment and he kept everybody in Tampa capable of making bonded Havanas for a few years. It was Mr. Oliva who really stopped the business from going off a cliff."
Many people in the cigar business still use the honorific "Mr." when referring to the late Oliva, even Llaneza, who worked with him for decades. Oliva won the hearts of his clients for life by not gouging them on that last shipment of Cuban tobacco that he brokered from Cuba.
Oliva's shipment was crucial, but it was only one crop, and wouldn't last long. People needed more tobacco. Cullman was one of many cigarmakers in a bind. He and a group of investors had purchased General Cigar a year before the embargo for about $25 million. The company made White Owls, William Penn and Tiparillo cigars, all by machine. All of them with Cuban tobacco. "We had to figure out what to make, and how we were going to make it," says Cullman.
The scramble was on for substitutes. "When we got the embargo, we bought tobacco left and right by telephone," says Alfons Mayer, the retired former senior vice president of tobacco for General Cigar. "We were buying Puerto Rico, Dominican, Colombian; people went to Brazil, we went all over Honduras, our native tobaccos here [in the United States]; we used some Java, some air cured, we made blends, blends, blends. People went to different areas to try and grow tobacco. There was a lot of trial and error."
Manufacturers reworked their blends. "For a lot of them, it was a disaster," says Llaneza. Bering, the No. 1 Clear Havana in America prior to the embargo, went from production of 400,000 cigars a day in Tampa to "almost nothing," says Llaneza. The change from Cuban to non-Cuban dethroned the brand.
While many cigar companies sold their stocks of Cuban tobacco, Llaneza and his partner, Dan Blumenthal, bought as much as they could. "The American Tobacco Co. started changing their blends," says Llaneza. "They had more Cuban tobacco than anybody. We bought a lot of the Cuban tobacco that they had."
Thanks to its massive inventories of pre-embargo Cuban tobacco, Villazon was able to use at least some Cuban leaves in its Bances brand until 1965. "That was Villazon's break -- they bought all the Cuban tobacco," says Seltzer. Llaneza adds: "We went from being the smallest manufacturer in Tampa to the largest."
By gathering as much Cuban tobacco as possible and, later, by creating blends that were Cubanesque and strong, Villazon crafted itself into a cigar powerhouse. Blumenthal and Llaneza cut deals with Fernando Palicio to make the cigar brands he lost in Cuba. In 1965, with Palicio on his deathbed, Villazon acquired the U.S. rights to Hoyo de Monterrey and Punch.
Villazon's star was rising, but making cigars in Tampa was becoming expensive, and aging rollers were harder to replace. Villazon and other Tampa cigarmakers began to look offshore.
A New Place to Roll
Even before the embargo, Cuba's tobacco men had been looking for new places to make their cigars. Benjamin Menendez, who watched as soldiers took his father's factory away in 1960, moved to the Canary Islands, opening Cia. Insular Tabacalera S.A. in 1961 with four cigar rollers. His father was an investor. The local tobacco grown on the Canaries, a group of islands off the northwest coast of Africa, wasn't a draw, but the country's cigar-making tradition, which dated back to the eighteenth century, was.
Menendez had an early hit with Flamenco, a Connecticut-shade cigar distributed by Faber, Coe and Gregg, which had lost the rights for handling Cuban cigars before the Kennedy embargo. Menendez struck gold with the launch of Montecruz, an unapologetic copy of the Montecristo brand that his family had lost in Cuba. Made with Cameroon wrapper, a dark, toothy leaf that would soon prove a worthy substitute for Havana wrapper, Montecruz quickly became the No. 1 premium cigar in the U.S.
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