Cuban Cigar Shortage. . . Why?

[JL Miller]

I have no super secret info., but my guess is the "shortage" is going for another year at least.....

Higher end cuban cigars will be a luxury item.... you will get to buy the lower end stuff but will still be much higher than you'd want to pay.

(Think most here have more cigars than they could smoke in a lifetime, so its just kinda conjector...)

[lundens]

[quote author=Corona84 link=topic=55707.msg215961#msg215961 date=1677894623]
Any updates on this shortage? I figured this thing would be over by now but it seems to have only gotten worse... It's hard for me to imagine that all of a sudden the Chinese just got super interested in Habanos and they're just gobbling them all up. How is that even possible? If you understand how the HSA distributer network is structured. It's not really possible for Chinese people to buy up all the Cuban cigars in the world. There has to be more to it than that. It reminds me an awful lot of the Rolex watch shortage that started a few years back and is still going strong. They were there on minute then gone the next. I'm well aware of exactly what's going on with Rolex. Greedy flippers cornered the market and they buy up damn near everything in sight or at least all the highly sought after models then kick them up to the grey market. This happened quickly. The Rolex authorized dealers, unfortunately, don't see them as flippers, but as "special preferred loyal customers." At the end of the day Rolex doesn't give a shit if their REAL loyal customers get screwed so long as they keep turning record sales.
[/quote]

In my experience traveling to China a decade ago, smoking a cigar, cuban or otherwise, was not popular in the least.  I don't recall seeing anyone smoking cigars there outside of ex-pats.  I once gifted some nice cigars to a business associate there, and I bet they didn't get smoked.    Now it sounds like it is been popularized, particularly cuban cigars.    It doesn't take much given the number of people in China to have demand exceed supply.

[Dmex]

Habanos S.A. sold a 1.4B stake to a Chinese group.  I assume like some others have said that the shortage will remain through this year, but even beyond the shortage the real pricing issue is that Habanos has raised the prices for all Cuban cigars to align with the Hong Kong market so even if supplies increase, the pricing will remain high, at least until the Chinese investors recover their investment money, which they are well on their way to doing with record profits in 2021 and 2022.  [url=https://www.morningstar.com/news/pr-newswire/20230227ln24230/habanos-sa-reaches-in-2022-a-turnover-of-545-million]https://www.morningstar.com/news/pr-newswire/20230227ln24230/habanos-sa-reaches-in-2022-a-turnover-of-545-million[/url]

I fear that cigars that we have all come to enjoy and love like Cohibas, Montecristos, R&J will remain high for the foreseeable future if not indefinitely, and Habanos will likely release new brands of inferior quality for less money. (I really hope I am wrong here, but this is my feeling, Habanos executives have said they will not increase production of premium branded cigars) [url=https://la-casa-del-habano-nyon.com/en/pourquoi-le-prix-des-cigares-cubains-a-t-il-fortement-augmente/]https://la-casa-del-habano-nyon.com/en/pourquoi-le-prix-des-cigares-cubains-a-t-il-fortement-augmente/[/url]  good article on la casa about the pricing strategy. 

Either way the future seems pretty grim for those of us who have supported the CC market.  It's a money grab, and just like with Bordeaux Wines, Italian Sport Cars, and other luxury/designer items, the Chinese will grab them all at a premium price just to have them as trophies.  It's a status thing more than an a appreciation for Cuban cigars.  They have the money and they want to own all the blue chip items to fit that status.  

[Lotusguy]

[quote author=Dmex link=topic=55707.msg216011#msg216011 date=1678128775]
Habanos S.A. sold a 1.4B stake to a Chinese group.  I assume like some others have said that the shortage will remain through this year, but even beyond the shortage the real pricing issue is that Habanos has raised the prices for all Cuban cigars to align with the Hong Kong market so even if supplies increase, the pricing will remain high, at least until the Chinese investors recover their investment money, which they are well on their way to doing with record profits in 2021 and 2022.  [url=https://www.morningstar.com/news/pr-newswire/20230227ln24230/habanos-sa-reaches-in-2022-a-turnover-of-545-million]https://www.morningstar.com/news/pr-newswire/20230227ln24230/habanos-sa-reaches-in-2022-a-turnover-of-545-million[/url]

I fear that cigars that we have all come to enjoy and love like Cohibas, Montecristos, R&J will remain high for the foreseeable future if not indefinitely, and Habanos will likely release new brands of inferior quality for less money. (I really hope I am wrong here, but this is my feeling, Habanos executives have said they will not increase production of premium branded cigars) [url=https://la-casa-del-habano-nyon.com/en/pourquoi-le-prix-des-cigares-cubains-a-t-il-fortement-augmente/]https://la-casa-del-habano-nyon.com/en/pourquoi-le-prix-des-cigares-cubains-a-t-il-fortement-augmente/[/url]  good article on la casa about the pricing strategy. 

Either way the future seems pretty grim for those of us who have supported the CC market.  It's a money grab, and just like with Bordeaux Wines, Italian Sport Cars, and other luxury/designer items, the Chinese will grab them all at a premium price just to have them as trophies.  It's a status thing more than an a appreciation for Cuban cigars.  They have the money and they want to own all the blue chip items to fit that status.  
[/quote]
I see tons of “look at me” people posting their Cohiba 55 on FB and almost none of them are Chinese.

[lundens]

Not that all Chinese live in China, but those that do aren't on Facebook.

[canadianbeaver]

3/4 auctions on BR last night in USA. All repeat buyers who have given nice feedback before. One in China but ship to his wife in Toronto a couple of hours away from us.

BR asks members what cigars they would like to see listed most and this news came in the newsletter this morning.

In the last month these were the most popular new items on buyer's wish lists:

1. H. Upmann Sir Winston
2. Ramón Allones Specially Selected
3. Cohiba Lanceros
4. Cohiba BHK 54
5. El Rey del Mundo Choix Suprême

How’s that for a mix?

CB

[Lotusguy]

[quote author=lundens link=topic=55707.msg216028#msg216028 date=1678193439]
Not that all Chinese live in China, but those that do aren't on Facebook.
[/quote]

Of course - though you'd be surprised how many people have VPN there

My point was, plenty of people outside of China that collect the big $$$ sticks. It's too simple to just blame China on the shortage.

I certainly am not contributing anymore - switched almost completely to NC. HSA can suck a big one.

[mbflash80]

[quote author=Lotusguy link=topic=55707.msg216033#msg216033 date=1678204307]
Of course - though you'd be surprised how many people have VPN there

My point was, plenty of people outside of China that collect the big $$$ sticks. It's too simple to just blame China on the shortage.

I certainly am not contributing anymore - switched almost completely to NC. HSA can suck a big one.
[/quote]

Claus what are you smoking on the NC front these days?

[canadianbeaver]

We traded his CC’s for my Macanudos and super valuable Ghurkas.

I so regret it but he has been at this a little longer than me ya know.

Nyuck Nyuck.

CB

[Lotusguy]

[quote author=mbflash80 link=topic=55707.msg216035#msg216035 date=1678206887]
Claus what are you smoking on the NC front these days?
[/quote]
Lots of Padron 1926 and Family Reserve and some Fuente Hemingway and Don Carlos and some Davidoff (mostly Nicaragua, Yamasa, and Late Hour). I still smoke my CC stash but not buying much anymore.