Cuba Increases Prices Of Cohiba Behikes—Again

[El Presidente]

On 4/29/2023 at 3:35 AM, dominattorney said:

I concur. When they were less than 100 a stick, I wouldn't necessarily think that. Maybe a guy celebrating a mile stone, lucky enough to have sourced a box. Now, it's like the people who buy the rainbow diamond flavored rolexes. I think sucker. 

Those with the propensity to call  others "suckers"  are near the bottom of societies barrel.  

Not my cup of tea/agree to disagree/I wouldn't do it/good luck to them but.   There are so many ways. 

No need to sling barbs at people you have never met.  undignifying. 

 

[El Presidente]

5 hours ago, Corylax18 said:

Tabacuba(and the military officials that leach off them) get sick of seeing cigars stack up in Havana and they say "screw it" and reset the on island prices to whatever they feel like. I'm being optimistic, but it is a potential crack in the current system. 

 

It is not out of the question. 

However I suspect they are making a mozza right now internationally. They are making a mozza making 55 million sticks thereabouts.

This new padarigm requires strict production control (manufactured scarcity) and no holes in the dike. Dropping Cuba prices would be that hole in the dike. As long as they are they are getting their cheque, the Cubans are likely to keep playing  ball. I am not sure as to how the LCDH in Cuba are traveling. On the one hand I hear that things have slown down considerably, on the other I hear that the mainland chinese are back and buying steadily. At the new pricing they only need less than half the sales as 2019 to make the same moola. Anything more and they are way way ahead. 

 

5 hours ago, Corylax18 said:

I should have been more specific. When is said "Hong Kong" I was referring to the new 50% owners of HSA. Not the whole territory. Its not a coincidence that the new ownership group is based there and they choose to peg world wide prices to that market. They were clearly sick of the mainlanders sucking up massive volumes of cigars in Havana before they could ever get to the ultra high tax markets. It didn't work, even at the new prices it appears to be the same as it ever was down there. 

Interestingly, Mainland prices are higher than HK. There has been a nice little arbitrage market. 

With venezuelan oil exports to Cuba dwindling, China is now believed to be Cuba's largest trade partner with  Russia and Mexico taking up the next spots. The actual situation is a little fuzzy as their has been some big changes over the last 12 months. It will clarify later in the year. Cuba's sign on to "Belt and Road" (2018) shows where they are parking their allegiance for the foreseeable future. 

 

[KnightsAnole]

6 hours ago, dominattorney said:

I concur. When they were less than 100 a stick, I wouldn't necessarily think that. Maybe a guy celebrating a mile stone, lucky enough to have sourced a box. Now, it's like the people who buy the rainbow diamond flavored rolexes. I think sucker. 

Yea, there is one born every minute. 

[El Presidente]

11 minutes ago, KnightsAnole said:

Yea, there is one born every minute. 

The world is certainly full of tossers. 

[El Presidente]

23 hours ago, ATGroom said:

Just to note, not saying you are Rob, but many people seem to be under the impression that all Habanos were to be pegged to the HK price. In the original press release from HSA it was only Cohiba and Trinidad that were pegged to HK. 

So an HK tax increase only means another increase for Cohiba.

I don't think anybody who was still in the market for Cohiba will really be forced out by another rise.

Correct Alex. We shouldn't give them any ideas 

[NSXCIGAR]

10 hours ago, Monterey said:

Now, they were in the 20's pre-pre cigarmageddon.  23/29/33 if I recall correctly.   Price moved from that onwards starting in May 2021 I believe.

I start cigarmaggedon on June 11 2022. There had been price hikes from late 20 through June 21 but nothing like the June 11 hike. In fact the late 20 hike really wasn't a hike as they were just compensating for the CUC inflation until its retirement in Jan 21. 

But you're correct--BHK prices in Aug 20 were still 23/29/33 and had moved to 35/47/51 through June 10 2022. 

[dominattorney]

23 hours ago, El Presidente said:

Those with the propensity to call  others "suckers"  are near the bottom of societies barrel.  

Not my cup of tea/agree to disagree/I wouldn't do it/good luck to them but.   There are so many ways. 

No need to sling barbs at people you have never met.  undignifying. 

 

Well, you'd place me at the bottom of the barrel eventually, wouldn't you Rob? I am a lawyer after all.....

I went back and read the three posts in which the term "sucker" came up. I don't think any of us said "people who buy this are definitely suckers."  My post, at least, conveyed my personal feeling upon seeing someone else shell out and buy a 650 usd cigar x 10 in the form of a box of BHK 56 about 3 months ago. The guy was pompous about it, and it made me think he was the type of person who was easily fooled by the hype. I then extrapolated out and generalized my feeling toward people who buy expensive things that are not necessarily worth the money. Note that I did not extrapolate out that all who do so are pompous. 

This guy smoked these cigars and, to justify his expense, acted like they were the best thing he's ever had in his life. I felt sorry for him. I generally feel sorry for people with more money than sense and could never really articulate why. Last week it made sense though. I represented a really decent guy charged with attempted murder. We were waiting for the jury to return a verdict--no calm mental state for a client with impending handcuffs. He gave me a box of Placencia Ehtefal that he came across and told me to smoke one every once in a while if he's in prison and think of him. He got acquitted, which was pretty neat and definitely well deserved. First thing we both think to do is run back to my office and grab that box of cigars and figure out who to give them away to. We gave one to his bondsman, one to his two friends that posted the bond when he first got arrested, one to my partner, and one each to his three friends who came to support him during the trial. This guy, throughout 2 years of representation, has always paid his bills and every once in a while brings a gift by to my staff because they're so nice to him. It's gotten to the point where I stopped meeting him over lunch because he'd never let us pay for anything and it made me feel I was taking advantage of him. I think even if this guy went to prison, he would still look on the bright side somehow. 

I've got another client with the rainbow daytona. Even when we win for this guy he's not happy. He just sits around wondering who has nicer things than him. I genuinely feel really sorry for him. I truly think he defines himself by what he buys and what other people think of those things. He has never even offered to pick up the tab at lunch when we go out. 

Anyway, back to the original 650 a stick BHK guy.  I don't think him being easily fooled by the hype, which is what I associate with being a "sucker" is a personal barb. His pompousness certainly was. But that is endemic to this specific individual and not a reflection of everyone who is easily fooled by hype. He might not be a sucker in actuality. But his actions make me think that he is. @KnightsAnole sees it that way too, Nd blames it on HSA for making suckers of its customers. I find it difficult to disagree with his mental impression. @PigFish says that cigars should be banned, as they make people stupid. I don't think these folks are wrong for feeling this way or sharing this sentiment. 

There was a young lady next to me and my wife at the Mercedes dealership whose father paid 90,000 over asking price last Saturday because she had to have the new G Wagon. I feel similarly about this. I feel her father missed a teaching moment to share a bit of the reality principle with her. 

I'm not telling either of these people, nor even the rainbow rolex daytona guy, that they can't spend their money this way, but I will say this. There is definitely a lot of merit to the sentiment that "its your money, you can spend it how you want" but I do not believe the world is a healthy place and the best place it can be when this maxim is extended to every situation.  I have seen super wealthy people wind up spending lavishly and wastefully on frivolous things. I'm not one to say where to draw the line for everyone, but I don't believe unrestrained libertarianism is the answer. It's not the answer for society and it's also not the answer for the individual him or herself. 

I believe I am entitled to feel that way, and further believe I am not the only one here who does. 

[Anknyc19]

The chinese have a huge appetitie for cubans, I know some that go between HK and mainland for the aribitrage

[SigmundChurchill]

8 hours ago, dominattorney said:

Well, you'd place me at the bottom of the barrel eventually, wouldn't you Rob? I am a lawyer after all.....

I went back and read the three posts in which the term "sucker" came up. I don't think any of us said "people who buy this are definitely suckers."  My post, at least, conveyed my personal feeling upon seeing someone else shell out and buy a 650 usd cigar x 10 in the form of a box of BHK 56 about 3 months ago. The guy was pompous about it, and it made me think he was the type of person who was easily fooled by the hype. I then extrapolated out and generalized my feeling toward people who buy expensive things that are not necessarily worth the money. Note that I did not extrapolate out that all who do so are pompous. 

This guy smoked these cigars and, to justify his expense, acted like they were the best thing he's ever had in his life. I felt sorry for him. I generally feel sorry for people with more money than sense and could never really articulate why. Last week it made sense though. I represented a really decent guy charged with attempted murder. We were waiting for the jury to return a verdict--no calm mental state for a client with impending handcuffs. He gave me a box of Placencia Ehtefal that he came across and told me to smoke one every once in a while if he's in prison and think of him. He got acquitted, which was pretty neat and definitely well deserved. First thing we both think to do is run back to my office and grab that box of cigars and figure out who to give them away to. We gave one to his bondsman, one to his two friends that posted the bond when he first got arrested, one to my partner, and one each to his three friends who came to support him during the trial. This guy, throughout 2 years of representation, has always paid his bills and every once in a while brings a gift by to my staff because they're so nice to him. It's gotten to the point where I stopped meeting him over lunch because he'd never let us pay for anything and it made me feel I was taking advantage of him. I think even if this guy went to prison, he would still look on the bright side somehow. 

I've got another client with the rainbow daytona. Even when we win for this guy he's not happy. He just sits around wondering who has nicer things than him. I genuinely feel really sorry for him. I truly think he defines himself by what he buys and what other people think of those things. He has never even offered to pick up the tab at lunch when we go out. 

Anyway, back to the original 650 a stick BHK guy.  I don't think him being easily fooled by the hype, which is what I associate with being a "sucker" is a personal barb. His pompousness certainly was. But that is endemic to this specific individual and not a reflection of everyone who is easily fooled by hype. He might not be a sucker in actuality. But his actions make me think that he is. @KnightsAnole sees it that way too, Nd blames it on HSA for making suckers of its customers. I find it difficult to disagree with his mental impression. @PigFish says that cigars should be banned, as they make people stupid. I don't think these folks are wrong for feeling this way or sharing this sentiment. 

There was a young lady next to me and my wife at the Mercedes dealership whose father paid 90,000 over asking price last Saturday because she had to have the new G Wagon. I feel similarly about this. I feel her father missed a teaching moment to share a bit of the reality principle with her. 

I'm not telling either of these people, nor even the rainbow rolex daytona guy, that they can't spend their money this way, but I will say this. There is definitely a lot of merit to the sentiment that "its your money, you can spend it how you want" but I do not believe the world is a healthy place and the best place it can be when this maxim is extended to every situation.  I have seen super wealthy people wind up spending lavishly and wastefully on frivolous things. I'm not one to say where to draw the line for everyone, but I don't believe unrestrained libertarianism is the answer. It's not the answer for society and it's also not the answer for the individual him or herself. 

I believe I am entitled to feel that way, and further believe I am not the only one here who does. 

It's all a spectrum though.  If getting what you want causes you zero pain or hardship, you are going to get what you want, and we are all on different parts of the spectrum.  

When someone purchases a luxury item that causes an impact on their lives, like taking food off the table or not being able to pay their rent, I think we can all agree that that is just stupid.  

For other's there are smaller sacrifices they are making because of the purchase, like a little less in the 401k or savings account, and we can reasonably disagree on quality of life now, vs quality of life later in life.

Then there are people who can buy luxury items with zero impact on their lives.  At that point, some people just want what they want, and can you really judge them for it when the purchase has all the impact on their lives as when an average person buys a sandwich and a coke?

I buy things now that I would have thought insanely stupid in my younger and poorer years, so I get where the sentiment comes from, but there is always someone with a lot less than you that would judge you for the money you "waste".  We are all here on a message board that celebrates spending hundreds of dollars on boxes of rolled up leaves that we light on fire.  How do you think we come off to some guy living in a mud hut in Zimbabwe?

[SCgarman]

13 minutes ago, SigmundChurchill said:

It's all a spectrum though.  If getting what you want causes you zero pain or hardship, you are going to get what you want, and we are all on different parts of the spectrum.  

When someone purchases a luxury item that causes an impact on their lives, like taking food off the table or not being able to pay their rent, I think we can all agree that that is just stupid.  

For other's there are smaller sacrifices they are making because of the purchase, like a little less in the 401k or savings account, and we can reasonably disagree on quality of life now, vs quality of life later in life.

Then there are people who can buy luxury items with zero impact on their lives.  At that point, some people just want what they want, and can you really judge them for it when the purchase has all the impact on their lives as when an average person buys a sandwich and a coke?

I buy things now that I would have thought insanely stupid in my younger and poorer years, so I get where the sentiment comes from, but there is always someone with a lot less than you that would judge you for the money you "waste".  We are all here on a message board that celebrates spending hundreds of dollars on boxes of rolled up leaves that we light on fire.  How do you think we come off to some guy living in a mud hut in Zimbabwe?

FWIW, the guy living in a mud hut in Zimbabwe doesn't have internet, nor cigars, nor a Rolex or anything else we discuss. He is unaware of anything else likely outside of his small bubble. Perhaps he is better off than all of us? You never know!

[SigmundChurchill]

3 minutes ago, SCgarman said:

FWIW, the guy living in a mud hut in Zimbabwe doesn't have internet, nor cigars, nor a Rolex or anything else we discuss. He is unaware of anything else likely outside of his small bubble. Perhaps he is better off than all of us? You never know!

Could be.  I don't know about all that other stuff, but I'm a huge fan of indoor plumbing.

😀

[Chibearsv]

From now until the end of my days, $50-60 is my cap for a special cigar. So my favorite Esplendidos are off my purchasing radar, which I can live with. Cohibas being out of bounds is just an inconvenience.  So if Behike costs $500 a pop, fine. And if there are buyers for those, makes zero difference to me. Have at it.

What flips my wig is the overall lack of quality and quantity of $15-20 cigars to keep the tuppers full. 

[Corylax18]

17 hours ago, El Presidente said:

It is not out of the question. 

However I suspect they are making a mozza right now internationally. They are making a mozza making 55 million sticks thereabouts.

This new padarigm requires strict production control (manufactured scarcity) and no holes in the dike. Dropping Cuba prices would be that hole in the dike. As long as they are they are getting their cheque, the Cubans are likely to keep playing  ball. I am not sure as to how the LCDH in Cuba are traveling. On the one hand I hear that things have slown down considerably, on the other I hear that the mainland chinese are back and buying steadily. At the new pricing they only need less than half the sales as 2019 to make the same moola. Anything more and they are way way ahead. 

 

Interestingly, Mainland prices are higher than HK. There has been a nice little arbitrage market. 

With venezuelan oil exports to Cuba dwindling, China is now believed to be Cuba's largest trade partner with  Russia and Mexico taking up the next spots. The actual situation is a little fuzzy as their has been some big changes over the last 12 months. It will clarify later in the year. Cuba's sign on to "Belt and Road" (2018) shows where they are parking their allegiance for the foreseeable future. 

 

It's a very interesting dynamic. I agree that China has become Cuba's main trading partner, regardless of what the current numbers say. Its just odd to me that they (GAESA) have allowed such a huge strategic shift in Cigars, while some of Cuba's other main sources of Income (mainly hotel rooms and Rum) appear to be running along the same way they always have. There must be different groups of generals making money from each avenue. Or maybe we should say different "executives" within GAESA. 

I know there have been some price increases on rum in the last few years, but nothing like we've seen with Cigars. The duty free store in T3 at Jose Marti had literally thousands of bottles, there was nor shortage of rum anywhere I looked. Its probably cheaper and easier to find then Gas/Diesel right now. 

Look at hotel rooms, there is no scarcity there, manufactured or otherwise. The famous hotels in Havana, somehow, maintain exorbitant rates, but the all inclusive's throughout the rest of the island have been a relatively affordable option for years. But they're still building and opening hotels (in Havana and around the rest of the island) as fast as they can. 

I'm just having a hard time rationalizing the massive difference in strategies. But its hard to argue that the new group is getting it wrong, in the short term. Maybe they only had a 5-7 year timeline on the investment. But even at these crazy prices, I don't see them paying off the initial investment, let alone profiting anything, in that timeframe.  

53 minutes ago, Chibearsv said:

From now until the end of my days, $50-60 is my cap for a special cigar. So my favorite Esplendidos are off my purchasing radar, which I can live with. Cohibas being out of bounds is just an inconvenience.  So if Behike costs $500 a pop, fine. And if there are buyers for those, makes zero difference to me. Have at it.

What flips my wig is the overall lack of quality and quantity of $15-20 cigars to keep the tuppers full. 

This is a great point. I was never a buyer of Behike, at any price. I'm even less interested in a box of Monte 2s with 5 duds in the box, at Behike prices. The Monte 2s are less attractive to me now than the Behikes where 5 years ago. 

[BoliDan]

If I was a behike guy and had the disposable income in my budget, I guess I'd be looking for them at these prices. I'm not though and my budget is limited, so price matters to me, and my perceived value of certain cigars will differ at a given price point. I used to buy boxes of CoRos regularly, but they are now out of my scope of value. So now I hunt down things like D4s or JLs. I wish I was in a situation where my value of certain cigars was limitless due to my massive resources, but that's just not my reality at this time.

[Bijan]

1 hour ago, Chibearsv said:

From now until the end of my days, $50-60 is my cap for a special cigar.

This has always been my rough rule. I bought Esplendidos, Siglo VI and CPE, but never any Behike, because I missed that boat. I guess I might have tried a single at $100, but I seem to have missed that boat too.

[SCgarman]

2 hours ago, SigmundChurchill said:

Could be.  I don't know about all that other stuff, but I'm a huge fan of indoor plumbing.

😀

Somehow our ancestors survived with out houses and oil lamps and candles. We have gotten soft!😂

[KCCubano]

5 minutes ago, SCgarman said:

Somehow our ancestors survived with out houses and oil lamps and candles. We have gotten soft!😂

I have spent a total of 8 months living out of a small tent in the Canadian wilderness and Arctic hundreds of miles from nearest road. Each trip I felt like the most blessed and richest person on the planet..indoor plumbing way overrated!! 

[Bagman]

3 hours ago, dominattorney said:

Well, youd place me at the bottom of the barrel eventually, wouldnt you Rob? I am a laywer after all.....

Welcome to the bottom.  We rule down here!

It's not the fact of smoking a 300 dollar cigar, per se, as 300 dollars to someone making a million dollars is nothing.  It is the perceived value over say a 30 dollar Partagas Luthy for example.  It isn't there.  And it is foolish and a waste of money, in my opinion, to spend 10x.

[Ciscojohansson]

I thought my self foolish for buying the few boxes I did when I had the chance, back in18/19. Now, not so much. I would sell them on BR if exporting tobaco was possible here. They will be my very special occation cigars.

[SigmundChurchill]

1 hour ago, Monterey said:

Welcome to the bottom.  We rule down here!

It's not the fact of smoking a 300 dollar cigar, per se, as 300 dollars to someone making a million dollars is nothing.  It is the perceived value over say a 30 dollar Partagas Luthy for example.  It isn't there.  And it is foolish and a waste of money, in my opinion, to spend 10x.

But the value of $300 is different to different people.  

When I was 20 years old and didn't have much money, if I lost $300 It would be a big deal.  If I lost $300 now, I wouldn't be happy about it, but it's not going to change my life at all.  I'll just go to the ATM and take out more money.

[Bagman]

4 minutes ago, SigmundChurchill said:

But the value of $300 is different to different people.  

When I was 20 years old and didn't have much money, if I lost $300 It would be a big deal.  If I lost $300 now, I wouldn't be happy about it, but it's not going to change my life at all.  I'll just go to the ATM and take out more money.

Agreed.  That is exactly what I was saying.

My point was that the BHK will not be a 10 times better cigar then a Luthy.  Or perhaps it is to some, so go enjoy!

[Bijan]

7 minutes ago, Monterey said:

My point was that the BHK will not be a 10 times better cigar then a Luthy.  Or perhaps it is to some, so go enjoy!

Yeah but that's another point. Let's say it's twice as good, to someone for whom $300 is not a lot of money, that might still make sense. They want the best cigar not the best bang for the buck.

Was a top Cohiba 2x better than a Sir Winston or Lusitania (or equivalent cigar) when the price was 2x? Again a lot of people might prefer a Sir Winston or Lusitanian, and even the person who prefers the Cohiba might think it's only marginally better or just a nice change of pace. When money is no object a lot of those calculations are not bang vs. buck.

There's a lot more there though. The question is does the person enjoy the Behike more, and therefore if money is not an issue, buys it?

Or does someone want to be seen burning a $300 bill in public/instagram and it might as well be a Gurkha?

[SigmundChurchill]

20 minutes ago, Monterey said:

Agreed.  That is exactly what I was saying.

My point was that the BHK will not be a 10 times better cigar then a Luthy.  Or perhaps it is to some, so go enjoy!

Yes, but for it to be "worth it", it doesn't have to be 10 times better for it to be worth 10 times more money, depending on how much the person values the money.  A small increase in enjoyment is worth the price to someone to whom the price increase means nothing.

Or maybe we are just saying the same thing.

Basically, there is no universal "worth it" price.  It's all relative.

[El Hoze]

Diminishing marginal value has always been a concept that applies to most things. At some point if you want something “just a little bit more special” you need to be ready to pay into the stratosphere. With consumables it’s particularly brutal. I had dinner w a guy I work with one time (and this was probably 15 years ago) who spent $60K on wine at a dinner for 6 of us. I couldn’t help but thinking I probably could have gotten us out of there for a “mere” $15K and recreated 98% of the experience but it was his money. “Was” for sure. Gulp.  

You had that with cigars even before the recent silly stuff. Sig VI GRs, stuff considered “the best of the best” or rare/discontinued was in the stratosphere. I think the real issue here is with the dramatic change in price for BHK over a short time. I have a bunch of boxes of BHK I bought over the years and I never spent $1,000. Now just a few years later that number has tripled or whatever for a cigar I’d call very good but not a blow-your-mind experience like a Sig VI GR. It’s just a huge change in a short time that jolts people. 

I used to get the same SUV new every three years. Daily driver. Now they are telling me the price of that truck has doubled including a dealer markup vs. the one I bought three years ago. I have paid up for some special cars over the years, but I just can’t wrap my head around paying 2X over a 3 year period for the same SUV to drive to the grocery store when other cars have gone up much less than 2X. I’ll drive something else. That to me is the issue. Whether it makes sense to buy a $4M Bugatti when you can get a perfectly good Ferrari for $400K is a different issue and not really a new one in my mind (personally I’d get the Aston Valkyrie and that box of Don Candidos from that Dunhill video).

I personally would not buy BHK at today’s prices but, ironically enough, I won’t sell mine either. They’re mine and I’m smoking them! I got rid of a car, however, a year or so ago as I bought it new and sold it for 30% more than I paid for it and drove it for a year. Everyone gets to do whatever they want with their money. 

[Bijan]

On 4/28/2023 at 1:35 PM, dominattorney said:

Now, it's like the people who buy the rainbow diamond flavored rolexes.

While I agree with your first point, this point is a bit different.

You/we/me can find a rainbow diamond flavored Rolex hideous, period.

Someone could get a such a watch for free, with a stipulation that they can't ever sell or give it away and you could still "look down" on the person for wearing it in public non-ironically.

I don't think we're arguing that a Behike is a Gurkha-like diamond crusted, gold-wrapped, money grab.

It's more like the steel Rolex that's selling for 3x what it used to because the world has lost its mind.

In the end though you can only wear one watch at a time, and smoke one cigar at a time, so given enough money, anything "tasteful/enjoyable" can make sense.