Cuba's cigars: a black market tale of survival

[El Presidente]

Cuba's cigars: a black market tale of survival

http://www.reuters.com/article/2011/12/16/uk-cuba-cigars-idUSLNE7BF00P20111216

By Jack KimballHAVANA | Fri Dec 16, 2011 6:11am EST

HAVANA (Reuters) - Packing long cigars into a white box picturing Shakespeare's Romeo and Juliet, a Cuban man delicately places a thin wax-paper stamp of quality inside.

He then finishes the job with an official guarantee.

Now, no one will be the wiser that these stogies are black market cigars.

"We have to do this just so we can live," the man, who asked to remain anonymous, said in the Cuban capital. "To make a living here, you have to be constantly doing business."

In a country where the average salary is about $20 a month, many Cubans say the black market helps buyers stretch their money and sellers supplement their income.

Some experts estimate that as much as 20 percent of goods are stolen as they are distributed to state outlets around the country - a drain President Raul Castro says must be stopped.

A box of Cuba's prized cigars could cost hundreds of dollars in stores, but black market dealers sell it for a fraction of that price, usually to tourists.

In Havana, clandestine street dealers lead buyers up narrow staircases to small apartments where different brands of cigars in tightly packed boxes are spread out on beds.

Some workers smuggle surplus cigars out of distributors and sell them. Others make them in their homes using leftover scraps, dealers said.

Police pressure is constant, they said.

Although official outcries against corruption are not new for communist-run Cuba, Castro is taking tough action against graft and is believed to have increased vigilance on the streets and around markets, looking for people selling items illegally.

Cuba's premium cigars - grown and cured in western Pinar del Rio province - dominate the world market and are one of the cash-strapped Caribbean island's top exports.

The nimble fingers of Cuba's licit cigar makers rolled out 81.5 million smokes last year, up 8 percent from 2009, according to the statistics agency.

The main buyers are France and Spain, but the jealously guarded global market share excludes the United States, where Cuba's cigars are banned under decades-old trade sanctions.

On the black market, everything to make cigars look authentic is sold. A bundle of quality stamps goes for about $30, boxes around $5-$6, a batch of rings for as much as $30. Cigars themselves may be as low as $8 for 25, a dealer said.

All the goods are pilfered from manufacturers, sellers said, giving them the right look, touch and smell.

Sellers said they are just trying to make a living.

"In Cuba, everything is dangerous. You depend on your wits and don't look for problems with anyone," one seller said. "If you depend on just your salary, you can't live."

(Reporting by Jack Kimball; Editing by Xavier Briand)

[Bcrowell]

I would have never guessed that fakes can come with all original yet illegal components.

[CigarB]

It would be interesting to know the ratio of cigars these guys sell that are legit (real but gained through illegal means) compared to those that are scraps/counterfeit. My guess is that the majority are the latter.

[CptKloss]

these esplendidos aren't glass top... it must be real.

[kyee]

Fake. Those are the darkest Esplendidos I have ever seen.

[ZinZan]

Fake. Those are the darkest Esplendidos I have ever seen.

Must be PSP

[mk05]

Must be PSP

And there goes the kitchen sink. LOL

All jokes aside, you just can't copy the correct aroma. And when you smoke it, you know. Smoked a Cohiba Robusto last week gifted by an elderly gentleman that had the correct band re CCW, however, no aroma, no taste. Snapped it in half in front of him (yes he was shocked), boom. Short filler. (yes really depressed)

For me, the question has always been, "how does such a small country produce enough cigars to meet worldwide demand yoy?" Until I can satisfy this reasonably, I must assume that there's at least 10-25% fakes in float that is even sold legitimately without anyone being the wiser (ie LCdH, etc). If anyone has some tobacco growing experience and someone has hectare figures to do a yield calculation, that would be great.

[CptKloss]

Cubas production of cigars fluctuates wildly - i think it was around 200 millions in the mid 2000s, down to 80+ now... Dominican Republic , country half the size of cuba makes 200m cigars a year as well...

in a right economic enviroment Cuba , a wild guess here, could make many times more QUALITY product than they do it now...300 millions? 500 millions? their only problem really would be the demand... of course opening US market would help...