There are 70 cigar factories in the country that produce close to 5,000 brands, and the sales they make to the U.S. surpassing the sales made in that country by companies from the Dominican Republic and Honduras.
Figures from the Cigar Association of America indicate that in 2018 Nicaragua exported 140 million cigars to the North American country, a figure surpassing the 95 million sold by companies in the Dominican Republic and the 75 million exported by Honduras. However, the goal of the Nicaraguan industry is to gain a greater presence in Europe, a market that until now has been dominated by products from Cuba.
Despite Nicaragua's political and economic crisis, tobacco exports in 2018 totaled $222 million, 10% more than in 2017.
Statistics from the Central Bank of Nicaragua (BCN) show that between 2017 and 2018 sales abroad under the free trade zone regime increased by $20 million, from $202 million to $222 million.
From January 22nd to 27th businessmen and investors will be visiting plantations and taking part in business meetings as part of the International Festival Puro Sabor.
The event will begin in Granada, but visits will also be made to Rancho Santa Ana in Rivas and Estelí. The Nicaraguan Chamber of Tobacco Producers (CNT), organizer of the Puro Sabor International Festival, expect the participation of 200 people from thirty countries.
In the first ten months of 2017, tobacco exports totaled $188 million, and the union of Nicaraguan producers estimates that by the end of the year they will have exceeded the annual goal of $218 million.
The $188 million generated from tobaccoexports between January and October of this year represents 85% of the goal set by the tobacco industry for this year.
British American Tobacco has announced that it will be investing $4.5 million in the construction of offices and a distribution center measuring 17 thousand square meters, which will start operating in June 2018.
Premium cigars led Nicaraguan tobacco sales abroad in the first half of the year, registering a 19% increase over the same period in 2016.
Due in part to the promotion of several cigar brands that entered the US market before the first half of last year, tobacco sales increased from $81.7 million in the first half of 2016 to $96.9 million in the same period this year.
In 2016 foreign sales of cigars grew by 11% over 2015, reaching $178 million, of which 84% were destined for the US market.
Figures from the General Directorate of Customs indicate that Honduras and Germany rank second and third in the list of target markets for Nicaraguan cigars.Between 2014 and 2016, growth was 10%, going from $148 million to $178 million.
From January 16 to 21st, 2017 entrepreneurs and investors in the sector will be visiting plantations and taking part in business meetings as part of the International Festival Puro Sabor.
The Nicaraguan Chamber of Tobacco Growers is awaiting the arrival of investors and entrepreneurs from more than 30 countries involved in the sector.Juan Ignacio Martinez, president of the union, told Laprensa.com.ni that"...So far people from 23 countries in Latin America, Europe, Africa and Asia, Oceania have confirmed".
The aim is to open markets in Europe and Asia in order to offset the decline projected in tobacco exports to the US because of new FDA regulations.
The goal of the Nicaraguan Cigar Association is to gain a "... 20% increase in sales to Europe, where a little less than 10% of the product is consumed, as the rest currently goes to the United States."
From August 8 premium handmade tobacco leaf cigars will be subject to the same regulation as cigarettes manufactured with additives.
A group of tobacco companies in Nicaragua will be holding meetings in the US with local companies who have invested in tobacco plantations and cigar factories in order to assess the impact of the entry into force of the new regulation.
The FDA is analysing changing the rules in order to apply the same rules for cigarettes manufactured with additives to premium handmade cigars and tobacco leaves.
Tobacco industry entrepreneurs from Nicaragua and Honduras, as well as the ambassadors of both countries to the United States, have expressed concern over the announcement that the FDA is preparing changes in regulation in order to treat cigars in the same way as cigarettes. If the measure is applied, the impact on the Central American tobacco industry would be felt significantly, because Nicaragua only exports 75% of its tobacco production to the northern country.
From 12 to 16 January 2016 the sector's entrepreneurs and investors will be visiting plantations and taking part in business meetings as part of the Puro Sabor Festival.
From a statement issued by the Nicaraguan Chamber of Tobacco Growers:
An announcement has been made of the launch of a new tobacco production export plant in the city of Esteli, with an investment of $2 million.
Government representatives noted that the 1000 square meter production plant will operate under the free zone regime, employing 400 people and it will start operating in January 2016.
Preparations are being made for a trip by a group of companies traveling from April 20th to 24th to the South American country to explore business opportunities under the trade agreement which has been in force since 2012.
This trade mission's main objective is to make the most of the existing free trade agreement with Chile, to create business opportunities especially for the food and tobacco industries.
Increasing the amount of land planted, consolidating markets where there is already a presence and exporting cigars to China are part of the tobacco industry's goals for 2015.
It is expected that in 2015 tobacco exports will grow by 5% and reach new markets such as those in China, Morocco and other Middle Eastern countries, where it is estimated that cigars would be very well received. These new destinations would join the 79 countries where sales are already being made. In 2013 total exports amounted to $227 million.
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