Entries for month: April 2014
Ok by now you probably have heard that the Food and Drug Administration has issued its so-called deeming paper on e-cigarettes and cigars.
All of this arises from the Family Smoking Prevention and Tobacco Control Act that gave the FDA the authority to regulate cigarettes, cigarette tobacco, roll-your-own tobacco and smokeless tobacco. Cigars were excluded. But there is a provision in the law to give FDA authority over any other tobacco product that the Agency by regulation deems to fall under the law. In essence, it decides what to cover. Hence, the “deeming” document. They are deeming e-cigs and cigars to now fall under their jurisdiction.
Most of the press has focused on the fact that the FDA wants control over e-cigs, which can be problematic. (The FDA is deeming that e-cigs, which do not even contain tobacco, are a tobacco product. As the New York Times said in an editorial "Nobody knows what the net impact of all this would be on the nation’s health." And: "Dozens of studies are underway to find out." Yeah, don’t do the studies first.)
As Dr. Michael Siegel notes, the FDA is not even sure that cigarette smoking is any more hazardous than vaping. And under the regulations, no e-cig companies could even tell consumers they are safer.
In the deeming regulation proposal, the FDA states: "Many consumers believe that e-cigarettes are "safe" tobacco products or are "safer" than cigarettes. FDA has not made such a determination and conclusive research is not available."
Clearly, the FDA does not believe that there is sufficient evidence at the present time to conclude that cigarette smoking is any more hazardous than vaping.
But the e-cigs are a separate matter.
For us, this FDA paper, not to be overly dramatic, could spell the end of the premium cigar industry. Says Glynn Loope of the Cigar Rights of America, "The potential for regulations such as those being proposed by the FDA would forever alter the premium cigar experience as we know it.”
This has been the worry all along. The one bright spot in these new regulations is that the FDA did include an option to exempt premium cigars from the onerous regulations. Loope says he thinks this option at least shows the FDA is listening to what consumers and cigar manufacturers have been saying, that premium cigars are different.
“The proposed regulations released by the FDA Center for Tobacco Products demonstrate a misguided attempt to regulate the premium cigar and pipe tobacco industries,” said IPCPR President Finnie Helmuth. “While IPCPR is encouraged to see progress in defining the unique tobacco products our retailers carry, this regulation remains flawed.” And General Cigar President Dan Carr said, “Our core strategy has been in urging CTP against adopting a "one size fits all approach" to tobacco regulation. Based upon our review of CTP's recent announcements, CTP appears to be taking this approach.”
But you can count on the fact that there is a lot of opposition on the other side to exempting premium cigars. The American Lung Association, was the first one out, saying, “Any exemption for any kind of tobacco product proven to cause lung and heart disease and cancer is unacceptable.” (So according to research cigars are ok then?)
There are problems with the premium cigar exemption as well. While it did pick up part of the definition of a premium cigar from the bill to try to stop this action, the FDA added that the cigars be primarily long fill, made by hand for wrapper, filler and binder (does that mean no Liebermans?), has no flavors other than tobacco and to me the killer, the FDA wants to set a minimum price of $10 per cigar. Oh and that price would be adjusted up for inflation every two years. (Guess the FDA doesn’t consider Fuente 8-5-8s or Padron Londres premium? Or perhaps they priced their cigars in high state tax areas.)
In any event, should the FDA NOT break out premium cigars, here’s what would happen. The rules, according to the tobacco law firm Troutman Sanders, would mean the Tobacco Act’s premarket review requirements would apply to the newly deemed products (cigars). That has huge consequences.
This means that, as a general matter, companies must seek and obtain FDA approval before they can sell new products, or even make changes to existing products. For cigars, a manufacturer’s ability to introduce new product lines, as well as make product changes based on tobacco growing variations, is viewed as critical to the industry.
In other words, as the tobacco in the cigar changes from year to year, you would have to go before the FDA and get approval to make those changes. Not only that, but because the law was written to grandfather cigarettes on the market prior to February 15, 2007, anything introduced after that time would be subject to FDA review. They will give 2 years before they start enforcing it, but think of all the new cigars that have come on the market since 2007, if premium cigars fall under this FDA purview they would have to file expensive paperwork proving they are “substantial equivalents” of existing products. What a nightmare.
This also means that for a company to introduce a new cigar shape, size or blend, it would first have to be sanctioned by the FDA. And we all know how fast the government moves.
Further if cigars are treated like cigarettes, it means no more free samples. How on earth could a store decide about a new brand without first smoking it? In addition, all the manufacturers would have to register with the government and provide it with a list of the ingredients (i.e. what leaves are being used, how many and where they came from.) Bottom line, the paperwork requirements and tracking would put many cigar companies out of business.
Ok so what do you do?
First of all the FDA is required to take public comment on its regulations. There are 75 days to submit it—now through July 9. Even the head of the tobacco control section has said this is not a spectator sport. Depending upon the comments the FDA gets this could be much better, or much worse. The Cigar Rights of America, the International Premium Cigar and Pipe Retailers Association and the Cigar Association of America are meeting this week to draft some responses and come up with links to make commenting easier for you. When we get those results we will pass them on.
You Must Take Action
Until we know what to say to the FDA, join the CRA. Get your friends involved - have them join too. Talk it up on Facebook or whenever you are enjoying a cigar. Lobby your Congressmen and Senators to become sponsors and then pass House Resolution 792 or Senate bill 772. This legislation known as the Traditional Cigar Manufacturing and Small Business Jobs Preservation Act of 2013 will prevent the FDA from taking over premium cigars. The clock is running.
We always hear the other side talking about banning smoking for the kids, well this is one time when smokers are doing it for the kids.
If you are in the New York area, you may want to make note of a gala on Thursday May 15th. It is the 2014 Dominican Foundation Gala and it marks the tenth anniversary of the Cigar Family Community Project right above Chateau de la Fuente. If you don’t know, the Cigar Family Charitable Foundation began as a dream of Carlito Fuente and Eric and Bobby Newman of J.C. Newman. The original concept was to add a wing onto a school. But it soon morphed from that into a huge complex where students are kept safe, given good water and meals and they learn.
Boy do they learn. 455 students have been transformed from being the worst to the best in the Dominican Republic. They have graduated 5 classes from the school so far with 90 percent going to college. Not only do the students learn math and science (and win awards in competitions) but they also end up being fluent in Spanish, English and French.
The funds for this project come from cigars. You’ve probably seen the Toast Across America limited editions that the Fuentes and Newmans put out each year. Every penny of those cigars goes to the foundation. Then there are fund-raisers like this gala. The cost is $350 for an individual ticket—if you want to go to the after party with Carlito at the Grand Havana Room it is $100 more. You can get tickets from the Dominican Foundation website. But this money really goes to a good cause. If you are in New York, you might want to go.
At Pro Cigar, one of the newer members brought in last year, was Tabacalera La Alianza… it is the home of Ernesto Perez-Carrillo. Not only does he make his EPC line of cigars, he also teamed up with his former sales manager Michael Giannini who remained at General Cigars and is now creative director over there. Both factories are in the Santiago Free Trade Zone and Giannini and Perez-Carrillo got together for a limited project called Re+United. But in addition to making his own products and the joint one with General, Perez-Carrillo also has been the home for Crowned Heads a company co-founded by Jon Huber formerly with CAO.
The company is known for making what they call artisanal quality cigars that are “defined by a combination of excellent flavor, balance and consistency.” The company has only been around since 2011 when it came out with its first cigar line, Four Kicks. It is a medium-to-full-bodied cigar with an Ecuador-Habano wrapper over Nicaraguan binder and fillers. It comes in four sizes—a Corona Gorda at 5.62” x 46, a Robusto at 5” x 50, a Robusto Extra at 5.5” x 56 and a Sublime at 6” x 54.
The second release in 2012 was Headley Grange, so named for the recording studio where Led Zeppelin recorded “When the Levee Breaks”. Huber has said rather than thinking about a cigar profile, he wanted the cigar to convey the song. Headley Grange is a beefier cigar than Four Kicks and uses an Ecuadoran Sumatra wrapper over Nicaraguan binder and fillers. Again it comes in four sizes, a Corona Gorda at 5.62” x 46, Dobles at 6.125” x 50, Estupendos at 5.5” x 52 and Hermoso No. 4 at 5” x 48.
Last year’s release was the J.D.Howard Reserve and the name comes from one of the aliases used by the outlaw Jesse James, who at one time lived in Nashville—home of Crowned Heads. The J.D. Howard uses a Brazilian Arapiraca wrapper over Ecuadorian Sumatra binder and Nicaraguan fillers. It is a deep chocolatey maduro smoke with some spice and it comes in, you guessed it , 4 sizes—HR46 6” x 46, HR50 5.5” x 50, HE 52 6” x 52 and HR 54 5” x 54.
If you haven’t guessed by now, they are available in the catalogue. We keep adding new stuff all the time and I wanted to keep you up to date.
For years, consumers roamed cigar shops looking for a certain brand. The question was do you have any…. and maybe they could get a few. No more. If ya haven’t looked at the website recently, you’ll notice we are now carrying Liga Privada.
You should know the story of the brand. When Steve Saka left JR to become president of Drew Estate, he wanted a cigar that he could smoke. Said Saka, “It was something that when I got to the company, realizing I didn’t smoke flavored cigars I needed a cigar I could smoke and share with people. It was embarrassing to be the president of a cigar company and not have any cigars that you personally smoke on a regular basis. It really began as a cigar for me to smoke, for Jon to smoke and Marvin to smoke.” The name comes from the number of blends they went through to get it right. (It really was a lot more than only 9 and some of the first ones Saka nailed to his wall. They were not what he wanted.) Anyway that is history, the factory is making more of them now, but still not enough. It uses a Connecticut Broadleaf wrapper over a Brazilian Matafina binder with Honduras and Nicaraguan fillers.
The T-52 is very similar except its wrapper is a stalk cut Habano wrapper grown in Connecticut. So why aren’t there more? As Marvin Samel told me last year, “The broadleaf and the T-52 wrappers are in extremely limited supply and the way we cure it in pilones takes over two years; it can’t be rushed. The yields are not great when extracting wrappers from the pilones. In addition, each of our filler leaves is from individual farms, and no other leaf from any other farm will do. So unfortunately we are very limited with Liga.” But there are enough so we now have them…and the T-52's as well.
There also are the Unicos… Dirty Rat and Ferral Flying Pig, L 40 Lancero and the UF 13. But as most of you know those are on backorder because they REALLY are more limited. But you can pick up a bunch of the Papas Fritas because they are in stock.
I assume some of you watched the Masters over the weekend. It was a great tournament but on Saturday the real action happened. That was when Bubba looked like he may have trouble (he ended up winning another green jacket) But Spaniard Miguel Angel Jimenez posted a 6 under par 66 to jump up 34 slots on the leaderboard.
Jimenez likes his cigars, even to the point of keeping one going in his mouth while performing his “unique” stretching routine during the Open championship a while back. Then there was the ESPN parody of the Most Interesting Man in the World commercial for last year’s Open. Jimenez is known for his cigars in fact Cigar Aficionado profiled him several years ago. Being from Spain, of course he prefers Cuban cigars… CA says he liked bigger ring gauges 52-56 making the Cohiba Siglo VI and Behikes his top choices at that time. Jimenez shot a 71 on Sunday putting him in fourth place behind winner Bubba Watson and Jonas Blixt and Jordan Spieth who tied for second. Jimenez got a payday of $432,000... He can pick up more cigars with that and undoubtedly will.
Ok I know that big ring gauge cigars are all the rage. Personally, I don’t get it. But then again when I first had a cigar the biggest ring gauges were like 47. Coronas were the biggest sellers. Today not so much. I am told there is a perception of value… getting more tobacco for the money. Anyway for whatever reason the big boys are here to stay—at least for a while. And that brings me to the latest big guy.
Juan Lopez is coming out with a new 7” x 70 cigar with a suggested retail price of $6.75. If you don’t know, Juan Lopez was an old brand from Altadis that got a complete makeover last summer at the trade show. The Juan Lopez is a Nicaraguan puro with tobaccos coming from each of the country’s growing regions. It comes in three sizes 5” x 54, 6”x 54 and 6”x 60. The 7”x 70 will be shipping shortly and should be available in a couple weeks.
H. Upmann is another brand from Altadis. Last year, the company added the Upmann Legacy line, which was a bolder take on the Upmann style. Legacy uses a nice Ecuadorian Sumatra wrapper over Nicaraguan binder and Nicaraguan and Dominican Republic fillers. Also in the next couple of weeks, H. Upmann will be getting yet another addition to the line, The Banker. If you know the history of Upmann in Cuba, you will remember Herman Upmann was a German banker who had cigars made for himself and his special customers. While it began around 1840, the Upmann’s bank and cigars did not do well being associated with Germany during and after World War One. The company went bankrupt by the early 1920s but the cigars were then made for a London based company. The cigars and the company really took off once Menendez and Garcia bought the brand in 1935. Anyway, going back to the Upmann family and their banking tradition, Altadis is coming out with The Banker by H. Upmann. Altadis says it is trying to recreate that original blend used by the Upmanns back in 1844. The Banker uses an Ecuador Habano wrapper and has a Nicaraguan binder from Jalapa over aged Dominican and Nicaraguan fillers. The cigar is rich and robust with coffee notes and spice. The Banker will come in three sizes, Annuity at 8” x 52, Arbitrage at 7” x 56 and Currency at 5.5” x 48. Prices are going to be between $7 -$8.40.
Last year was a pretty good year for cigars, actually a recent record. According to the latest data from the government, compiled by the Cigar Association of America, imports of premium cigars were up about 4% last year for a total of just over 317 million cigars. For large cigars, the numbers were up 16 % but the CAA figures a lot of these were formerly little cigars that have been reclassified as large cigars.
Back In February after attending the Tobacco Plus Expo, I wrote about Convenience Stores getting into some premium cigars. General has been there with single foil packs of Macanudo, Punch and Partagas, Altadis has joined in as well, along with Oliva and Rocky Patel. Drew Estate has also been in the market with special ACID cigars. Another new player in the premium market is Swisher. Known for their Swisher Sweets, they have come out with three premium lines for cigar stores and a fourth brand that is a cross-over smoke for both Convenience Stores and Tobacconists called Gold Strike. It is a mixed fill premium with a price of about $2 and comes in three packs or bundles for Tobacconists. Already Swisher has Gold Strike in 9,000 retailers and that should make an impact for this year.
As of last year, cigar sales for Convenience stores was down a little under 3% according to Information Resources Inc. But cigar sales in c-stores totaled $2.36 billion—nothing to sneeze at. And analysts are predicting a strong year in 2014.
Said Tom Pirko, president of BEVMARK LLC, a retail consulting firm in Buellton, Calif. “There is always concern with any type of tobacco that the government will ruin a good thing, but right now, this category is strong and should remain strong for the foreseeable future.”
Right, the government could screw it up which is why you need to contact your legislators and get them to back H.R. 792 or S 772 to keep the FDA out of our humidors. The bill has 152 House sponsors and 14 Senate. We need more. Join the CRA in its fight.
I thought it was just something here in Dallas, but it may be a thing. At one cigar store, on Tuesday nights a bunch of cigar smokers get together for Bible study. They sit and discuss the Bible all the while enjoying a fine premium cigar. Now comes word out of the Cleveland, Ohio, area that a local pastor up there has a Smokin Bible Study group. The leader of the group is Rev. Eric Van Scyoc according to the story written by Linda Kinsey.
Van Scyoc, a Bay Village resident, is shepherd to his flock at St. Thomas Lutheran Church in Rocky River. But from 5:30-6:30 p.m., two Wednesdays a month, he gathers with mostly non-parishioners at the Cigar Cigars shop in Rocky River.
“Smokin’ Bible Study” meets in the store’s lounge, a man-cave–like place with subdued lighting and scrumptious brown leather chairs and big-screen TVs. Although Van Scyoc says women are welcome to attend, I feel a little out of place as I first walk in.
“We’ll give you a free cigar for being new here,” Van Scyoc says to me, asking the store manager to pull a cigar from the box behind the counter. And the participants are good-natured about having a woman and a journalist in their midst. I start to feel at ease. But I probably won’t smoke the Dominican Republic-made cigar anytime soon.
Ahhh she does not know what she is missing.
We recently told you about New Jersey’s bright idea to ban smoking on the beach, well Ocean City, Maryland, is thinking about the same thing. The idea is likely to come up in the city’s next council workshop on April 16th. A couple of weeks ago the city said it also would crack down on profanity. Sh*t Really? Yup. Now comes the smoking ban.
Apparently Mayor Rick Meehan is a goody two-shoes.
Meehan supports a tobacco-free Ocean City, but he said proper enforcement and alternatives will be key to making that happen. It's a contentious issue, and the process of debate and voting will take at least a month, he said. So, while he expects a vote in "the near future," that might not be this summer.
"This is all part of a lengthy conversation," he said. "It's 2014. We all realize the issues that are involved. We want to be fair to everybody and allow areas for smokers."
Also some of the businesses in the area are likely to speak out against it.
Last week was the 20th anniversary of A Night to Remember. If you ever wonder about cigar smokers and their generosity here is something to which you can point. As Greg Mottola writes in CA, about that first event
What might have been another forgettable Tuesday evening in New York City became something quite extraordinary on April 1 as Marvin R. Shanken, editor and publisher of Cigar Aficionado magazine, stepped up to a podium at the Four Seasons Restaurant and held up a brown paper bag—a brown paper bag that wound up raising half a million dollars for prostate cancer research.
Since then, Shanken and Michael Milken—the founder and chairman of the Prostate Cancer Foundation—have gathered each year to put on one of the classiest charity cigar events. Not only that, but this year, the haul was $1.6 million for prostate cancer research. Over the course of the past 20 years, A Night to Remember has brought in more than $18 million.
For Milken the event is very personal.
"You always want to know the rate of return on your investment," said Milken, who is a prostate cancer survivor. "Since these dinners started, there are two million men alive today due to the reduction in death from prostate cancer. The death rate has dropped 80 percent from projected totals. And the very first trials of abiraterone were financed at this dinner. In 1993, I was given 10 to 12 months to live. Let me thank you, Marvin, and everyone here, for the last 20 years."
It is a star-studded black tie event with speakers like former New York mayor Rudy Guiliani, Rush Limbaugh and former NBA star John Salley. There were rare wines and scotches auctioned along with special cigars and even golf trips. The cigars were a humidor of 50 Padron 50th anniversary cigars which sold for $50,000…another bidder got a mystery package which turned out to be a round of golf and a night out with Rocky Patel in addition to 270 of Rocky’s cigars for $35,000, a stunning Davidoff limited edition humidor with Year of the Dragon and Davidoff Nicaraguan cigars for $25,000, and 200 special Montecristo cigars made just for the event, along with 5 extra boxes of Romeo by Romeo y Julieta that went for $35,000. But the biggest cigar haul was over 800 cigars from Fuentes which included:
A complete set of Fuente Fuente OpusX smokes, Fuente Fuente OpusX Angel's Share, Arturo Fuente Destino al Siglo, the chest of Opus22 (which contains commercially unavailable cigars) and boxes of the Fuente Fuente OpusX Lost City. The lot also included a Fuente Fuente OpusX golf bag, a crystal ashtray, colorful tins of Fuente Fuente OpusX cigars and Arturo Fuente coffee.
Congratulations to CA for really showing what cigar smokers can do.