Villiger Taps JMG International For West Coast Distribution

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September 5, 2018

By: Blake Droesch - Cigar Aficionado

The company behind handmade cigar brands such as Villiger La Flor de Ynclan and Villiger San'Doro is outsourcing its sales effort for the West Coast market. Beginning next week, all Villiger Cigars North America products going to California, Oregon and Washington will be distributed by JMG International, Inc. 

"Over the span of 22 years [JMG International] has become one of the most respected, and well-known distributors of premium cigars on the West Coast," said Rene Castaneda, president of Villiger Cigars North America, which is headquartered in Miami, Florida. "We look forward to a fruitful partership that will help spread the Villiger lifestyle to a larger audience."

Founded in 1996 as a cigar brokerage company, JMG International is based in San Jose, California, and already works with well-known companies like Padron Cigars, General Cigar Co., Davidoff of Geneva and My Father Cigars. On September 10, Villiger will join the list of clients, hoping to continue its growth in the U.S. marketplace by utilizing JMG's relationships, which boasts more than 1,000 retailers on the West Coast. 

Villiger's internal sales team will continue to manage the rest of the U.S. market.

Villiger Cigars North America is the premium cigar division of Switzerland's Villiger Sohne AG, one of the world's largest producers of machine-made cigars. Its premium cigars are manufactured at the ABAM factory in the Dominican Republic, as well as its factory in Brazil. Additional Villiger production is handled at the Joya de Nicaragua factory in Esteli, Nicaragua. 

Strikes End In Nicaragua, Country Remains In Turmoil

June 18, 2018

By Gregory Mottola - Cigar Aficionado

Cigar factories in Nicaragua are operating once again, as the country’s nationwide, 24-hour labor strike staged last week has ended. Many sources in the industry have confirmed to Cigar Aficionado that cigar operations are up and running, though the political situation in Nicaragua is still unstable.

“Our people were back to work Friday,” said John Oliva Jr. of Oliva Tobacco Co., a tobacco growing and brokerage operation. Along with his father and other family members, Oliva owns a tobacco processing facility in Nicaragua called Procenicsa, which supplies much of the premium industry with raw leaf.  

“Our operations are in Estelí and we have not experienced any violence,” Oliva said.

Companies including J.C. Newman, A.J. Fernandez and Plasencia Cigars have all stated that cigar production has resumed.

“Everybody went back to work,” Nestor Andrés Plasencia said. “We are so proud of our people that they are committed to making great cigars despite the situation.”

The strike began last Thursday at midnight and ended on Friday morning, prompting peace talks between the government and opposition officials. Mediated by the Catholic Church, the dialogue resulted in a cease-fire. 

The government has also agreed to allow to an independent investigation commission into the country, but one thing was made clear— President Daniel Ortega intends to finish his presidential term, which ends in 2021. 

Despite the cease-fire, the peace deteriorated shortly after. According to a report by BBC News, the truce was violated the next day, as six more people were reported killed in an arson attack on Saturday morning. 

To further complicate things, the Pan-American Highway, Nicaragua’s main causeway for commerce and logistics, remains besieged by roadblocks and barricades, preventing trucks from delivering cigar shipments to the airport or to the ports of Honduras in a timely fashion. The blockades have delayed some 6,000 trucks, according to news reports.

The political unrest began in April when Ortega announced an overhaul to the country’s social security system. He quickly rescinded the proposed tax increase once the country erupted into violence, but the situation has only escalated since.

Some reports have the death toll as high as 170.

“There have been some adverse effects in regards to the transportation situation in the country due to road blocks,” Oliva said. “Though things are tenuous in the country right now we’re obviously hopeful for a peaceful resolution.”

Nicaragua On 24-hour Labor Strike

June 14, 2018

By Gregory Mottola - Cigar Aficionado

“Nicaragua is in turmoil. We had eight people shot and killed on the road in front of our factory last week. They were protesters on the road," - Rocky Patel, Rocky Patel Premium Cigars

Most of Nicaragua has gone on a 24-hour labor strike today, and that includes the workforce of the premium cigar industry. Cigar factories are closed, tobacco fields are empty and the cigar industry continues to wait out this time of political turmoil and instability.

“It's a very tough situation,” said A.J. Fernandez, owner of A.J. Fernandez Cigars. “But we just want the best for the country, our people and everything to return to normal.” Fernandez owns two cigar factories in Nicaragua as well as many tobacco plantations.

“Following the direction of the Nicaraguan Cigar Association (ANT), our J.C. Newman PENSA factory in Estelí, Nicaragua, is closed today,” said Drew Newman, general counsel for the J.C. Newman Cigar Co. “This is the first time that we have ever had to close our J.C. Newman PENSA factory on a work day since it opened in 2011.”

Today’s labor stoppage is just one more obstacle the cigar industry—and the entire country of Nicaragua—has been facing since April when the country erupted in anti-government protests. Initially, the cigar industry was hardly affected, but the situation escalated, as did the death toll, which some reports have as high as 140.

Protesters have since taken the Pan-American Highway hostage, erecting many roadblocks along the country’s main causeway for commerce. This has put truck deliveries to a near-stop, creating backups along the highway that have lasted for days. The blockades have stopped an estimated 6,000 transport trucks and cargo vehicles headed to ports in Nicaragua and Honduras. Consequently, cigar shipments to the U.S. are largely delayed.

“We, as all the factories in Estelí, are not working today,” said cigarmaker and tobacco grower Nestor Andrés Plasencia, who owns a cigar factory in Nicaragua. “Our main concern is the security of all our collaborators so we don’t work today. We will start tomorrow, Friday, as normal.”

The strike is only supposed to last 24 hours and should be over by midnight, but the Pan-American Highway will most likely remain under siege. There is no indication as to when the political protesters across the country will release the highway—which is one of Nicaragua’s major commercial causeways—or when the cigar industry will become stable again. 

Rocky Patel, owner of Rocky Patel Premium Cigars, believes that the protest could possibly go longer than 24 hours. 

“They could extend it tomorrow, too,” he warned. “Nicaragua is in turmoil. We had eight people shot and killed on the road in front of our factory last week. They were protesters on the road.”

Patel is referring to his TaviCusa factory, located in Estelí.

“We got orders all week with major distributors loading up on Nicaraguan product,” Patel added. “It’s been very difficult to staff the factory when half the employees are showing up.”

The U.S. Department of State maintains its Level 3 travel advisory for Nicaragua (Level 4 is the highest), which it issued in April, discouraging travel to Nicaragua and urging U.S. citizens to vacate the country.

General Cigar Co. operates its STG, Estelí factory in Nicaragua and is also shut down.

“The strike is today, so we have closed our factory,” confirms Regís Broersma, president of General Cigar. “We don’t know yet what we will do about opening tomorrow. It all depends on what happens today. The safety of our people comes first and above all.”

Peace talks are scheduled to resume tomorrow at The Seminary of Our Lady of Fatima, and will be mediated by The Bishops' Conference of Nicaragua, a Roman Catholic organization that’s stepped in to help communication between the government and the people. The dialogue will convey President Daniel Ortega’s new proposal in hopes of reaching a peace and stability.

While the Oliva Cigar factory is closed today as well, José Oliva of Oliva Cigar Co. is hopeful that an agreement can be reached.

“We are encouraged by the return of dialogue from all sides and hopeful for a peaceful solution.”

Protesters In Nicaragua Block Pan-American Hwy, Stalling Cigar Shipments

June 12, 2018

By: Gregory Mottola - Cigar Aficionado

nti-government protesters in Nicaragua have put up several roadblocks along the country’s Pan-American Highway—a major shipping route—stopping an estimated 6,000 transport trucks and cargo vehicles headed to ports in Nicaragua and Honduras. As a result, cigar shipments have been delayed. 

“Container movements have been shut down,” said Jorge Padrón, of Padrón Cigars Inc. “They can’t move merchandise because there are roadblocks everywhere. There are barricades all over Nicaragua on the roads. It’s a huge problem to move things in and out.”

Drew Newman, general counsel for Tampa-based J.C. Newman Cigar Co., explains how shipping logistics normally work in Nicaragua.

“Cigars leaving Estelí generally travel north on the Pan-American Highway, cross the border into Honduras and leave via a port in Honduras,” Newman said. “Smaller shipments are sometimes driven to Managua where they depart via air. But air freight is equally difficult as well because the blockades around the Managua airport are preventing not only goods from getting to the airport, but also the workers who are needed to load the cargo.”

J.C. Newman Cigar Co. produces cigars at its PENSA factory in Estelí, Nicaragua. On average, it sends out a shipping container of premium cigars to the U.S. every week.

“Roadblocks have been delaying shipments,” Juan Martínez, president of Joya de Nicaragua, told Cigar Aficionado. "Some transport companies have not been able to bring trucks to Estelí. So, yes, some companies have suffered delays. In our case and many others, everything is being shipped by air and it’s happening also with delays. A truck can take up to two days to get to the airport [Augusto C. Sandino International Airport] and back. To be precise—shipments are happening with delays, but happening."

Cigarmaker and tobacco grower A.J. Fernandez is also experiencing difficulties, not just with outgoing shipments, but with employees getting to work as well as third-party collaborators from other companies.

“Many of our collaborators travel from places outside of Estelí,” Fernandez said. “At some point, due to the traffic jams and blockades by the protesters, they have not been able to reach our factory. It affects production and our ability to work together. Shipments have been delayed ranging from days to a few weeks, but we have not stopped sending to the U.S.”

Protests around the country erupted in April when President Daniel Ortega announced a tax increase and an overhaul to Nicaragua’s social security system. Most of the protesting took place in the capital city of Managua, but some of the violence spread to the cigar-making city of Estelí. 

For a while, the violence seemed to have died down and the premium cigar industry was not initially affected. Now, many reports have the death toll as high as 100 people, and the road barricades have disrupted the cigar industry’s ability to move product from factory to port. 

“The situation is very fluid and difficult right now,” added Newman. “Making matters worse, yesterday the president of the Trucking Association of Nicaragua (ATN), said that the large trucks that carry containers will not be operating in Nicaragua due to the lack of security for drivers and the fact that many drivers have been stuck on the Pan-American Highway for days.”

For the past two years, Nicaragua has been the largest supplier of premium cigars to the United States. Exports from Nicaragua grew steadily over the last decade. In 2017, Nicaragua exported 148 million premium cigars to the U.S.—more than any other country. 

Fernandez, whose company has helped to feed the U.S. appetite for Nicaraguan cigars, hopes for resolution soon: “We hope that all this will be solved in the shortest time possible, and normality will return to the country.”

Additional reporting by David Clough