Tobacco firm Habanos says China could become biggest global customer
A surge in sales of Cuba's legendary cigars in China helped manufacturer Habanos SA's global revenue rise 12 percent to hit a record of around 0 million in 2017, the company said at the start of Cuba's annual cigar festival.
Habanos, a 50-50 joint venture between the Cuban state and Britain's Imperial Brands Plc, said sales in China, its third export market after Spain and France, jumped 33 percent in value in 2017.
"Without doubt, there is potential for China to become the biggest market at a global level," Habanos Vice President of Development Jose María Lopez said after the company's annual news conference.
The Cuban monopoly cigar company's hand-rolled cigars, which include brands such as Cohiba, Montecristo and Partagas, are considered by many as the best in the world. And the festival attracts wealthy tobacco aficionados and retailers from all over for a week of extravagant parties and tours of plantations and factories.
Lopez said that growth in global sales of Cuban cigars last year outpaced the luxury goods market, which expanded 5 percent, according to consultancy Bain & Co. He put sales growth down to several good tobacco harvests and new products.
The Habanos executive said the outlook was also positive, given solid demand and "excellent" climatic conditions. Hurricane Irma, which wrought havoc throughout much of Cuba in 2017, left the western, prime tobacco-growing state of Pinar del Rio mostly unscathed.
Cigars are one of the top exports for the Cuban economy, which is otherwise struggling with decreasing aid from key ally Venezuela, a cash crunch and a pushback against market reforms.
However, Cuba cannot sell its signature export to the biggest market worldwide for cigars, the US, due to the decades-old US trade embargo.
Cigars have been Cuba's signature product ever since Christopher Columbus saw natives smoking rolled up tobacco leaves when he first sailed to the Caribbean island in 1492.
Late revolutionary leader Fidel Castro was often seen puffing on his favored kind, the long and thin 'lancero', until he quit in 1985.