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Sales of Cuban cigars on the rise

By Patrick Oppmann, CNN
updated 3:43 PM EST, Mon March 5, 2012
STORY HIGHLIGHTS
  • Hundreds of people from across the world visit Cuba every year for its annual cigar festival
  • Cuban cigars are renowned for their quality, craftsmanship
  • Sales of the cigars were up 9% last year, according to their distributor
  • Knockoffs are common, so cigar makers are implementing new security measures

Pinar del Rio, Cuba (CNN) -- On Yosvany Concepcion's ramshackle farm, there is little to suggest that he is producing a highly sought-after luxury item.

The buildings on the farm look like a strong wind could carry them away. There is virtually no machinery.

But Concepcion grows the tobacco leaves that are transformed into Cuban cigars. And much of the allure of these legendary, expensive cigars is that they are still made entirely by hand and in places, like Concepcion's farm, that seem trapped in time.

"As you can see, we do things the traditional way," Concepcion said, gesturing to the barn where green tobacco leaves are hung to dry before being rolled into cigars.

He and the rest of Cuba's tobacco farmers might soon have their work cut out for them.

Executives from Habanos, the Cuban-British joint venture that distributes Cuban cigars, announced at their annual festival last week that sales were up over 9% in 2011. That growth, executives said, could indicate that the market for luxury goods is rebounding despite a still-shaky world economy.

A Cuban farmer works the land in Pinar del Rio, Cuba, a region famous for producing the island\'s best tobacco.
A Cuban farmer works the land in Pinar del Rio, Cuba, a region famous for producing the island's best tobacco.

The festival was also bursting at the seams, with 1,500 attendees from 60 countries paying top dollar to taste Cuba's best smokes.

"Things are going well," said Rodrigo Malmierca Díaz, Cuba's trade and foreign finance minister, as he toured the festival in Havana. "The cigar has been appreciated since Columbus landed here. And it will continue to be, because they are very good."

As good as they might be, Cuban cigars are illegal in the United States because of the U.S. trade embargo with Cuba.

"The embargo is something that affects everyone," said Jorge Luis Fernandez Maique, co-president of Habanos. "It affects us as a country, as a business, and it affects the American consumer. They can't buy directly from Cuba, so they have no way of knowing if they are buying genuine Cuban cigars."

Many of the Cuban cigars that are available on the black market in the U.S. are probably fakes, cigar experts say. Cuba is also awash in knockoffs. Tourists on the island receive near-constant offers from peddlers selling imitations at prices far below what the government stores sells genuine cigars for.

"Smoke a fake cigar, and you will not find the right blend," said Ana Lopez, Habanos' director of marketing. "You are going to find something totally different, and probably (you) will be disappointed."

Cigar makers responded last week by unveiling security measures, such as holograms and serial numbers, on the labels of some premium brands.

"We have included a number of security elements into the band which makes them unique and impossible to copy," said Henk Nota, president of Vrijdag Premium Printing.

Cigar distributor Angela Giannoulis has traveled from Canada more than 10 times to attend the Habanos festival. She said she is brought back by her love of cigars and desire to stay up to date on the industry.

"You get to try stuff before anyone else, so that's a nice perk," she said. "And it's people united by the same passion. You can smoke anywhere, you can get them fresh out of a roller's hands. It really is an art to be appreciated."

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