A Conversation with Angel Daniel Núñez
Angel Daniel Núñez, the president and chief operating officer of General Cigar Co., is not your typical executive. He oversees all aspects—from seed to store shelf—of the 8,000-employee company by walking the myriad fields where General grows its tobacco, staying directly involved with the processing of that leaf and regularly visiting the factories in Honduras and the Dominican Republic where General makes millions of cigars by hand each year. He has spent more than three decades with General, which makes Macanudo, Partagas, Cohiba, Punch and Hoyo de Monterrey. The Richmond, Virginia, company is a unit of Swedish Match AB of Stockholm, and going from tobacco fields to cigar factories to the company's various offices as well as customer visits keeps Núñez on an airplane nearly every week.
In June, the 55-year-old Núñez sat down in New York City with senior editor David Savona for a wide-ranging discussion about himself and his company.
David Savona: We just lit up your new Partagas 160, which is made from the same batch of Cameroon wrapper from the 1970s used to make the Partagas 150. Can you talk about the wrapper?
Angel Daniel Núñez: It was 1995 when we bought the whole wrapper lot. It made such an impact on me that since then, I always keep the best 10 bales of every crop we grow or finance. I call it my personal library. Sooner or later somebody—it doesn't have to be me—they have something that is special. It's expensive, but it's romantic.
Q: Let's talk about this particular cigar. The wrapper is from 1977?
A: The batch was a mix of 1977 to 1981. So there were five crops, 947 bales.
Q: That's a lot of tobacco.
A: A huge amount. It was like going into a gold mine.
Q: Who owned it?
A: It was Tabacalera of Spain, and Alfons Mayer [the now retired tobacco buyer from General] and I made a trip to Malaga in 1995, and they had a beautiful warehouse. That's when we first saw the product. In those days there was a shortage on Cameroon tobacco. When we saw the grades and the sizes, we were a little bit discouraged. I remember we were going all over the list and the sizes were so discouraging, because they were medium to small sizes. So we said, "Now that we're here, let's look at it, and if it's not good maybe we'll use it in machine-made product." And we opened up a couple of bales, and what came out of it—the aroma, the smell—it was magic. It was like a genie from a bottle. But it was dry, so I asked for a bucket of water. I had nothing to lose. So I dumped [the tobacco] into the bucket of water, shook it out, took a few hands, and we wrapped it in a piece of cotton cloth and we said we'll come back in the morning. I have to be honest, my expectation was we would come back and it would be all smeared, maybe rotten, but what a surprise. That tobacco started to talk, and the sheen came out, and right there we understood this was something special.
Q: You didn't have enough tobacco to make regular Partagas at that point, right?
A: Yes, we even stopped production. Then we met in Puerto Plata [in the Dominican Republic], and the idea came out—why don't we make something special, because it's the 150th anniversary of Partagas. And in those days there wasn't a market for a four [inch] by 46 [ring gauge] cigar, short-size cigars were not in demand. We did what we could with the sizes, I said, OK, let's make this amount, put it in the market, and then I would take care of the rest.
Q: I don't think a lot of people knew that you had more of this wrapper, and that you could use it to make more cigars.
A: We did say that we didn't have enough to make those sizes, but we did have more to make small sizes, but there was no market for it. Last year we started to think, let's use the tobacco. The smoke is so mature and clean, it's a fresh smoke.
Q: Describe what you've gone through to hold on to this leaf. I know you have a lot of tobacco, but you went through special precautions with this.
A: One is making sure the humidity and temperature was as constant as possible, to prevent breakage but still allow the tobacco to keep working, having adequate humidity and temperature. And for safety reasons, we divided the lot into four locations. We have it in two locations in the U.S.A., and two locations in the D.R. Two months ago, we started bringing some from each of the locations and blending them. Most of these cigars are made already, because we are going to age them four months.
Q: For those who don't know, explain why you would further age a cigar that is made with a component that is 30 years old.
A: When the tobacco is in the bale, it is trapped. But every time you add water to the tobacco leaf, then you start the reaction again. Ammonia is going to be liberated. From my point of view, what we owe to the consumer is to sell and provide a product with the least amount of ammonia as possible. Once we case, or humidify the tobacco, it starts to take life again and starts the process, which creates ammonia. And that's the reason for aging—put it in a place where the cigars have time to breathe and release the ammonia slowly. Once it dries out, there is no more ammonia released.
Q: Did you have to handle this old tobacco differently?
A: Much, much more care. We set the bale to absorb humidity for one month in an 85, 90 percent humidity environment, so the tobacco would slowly absorb humidity. Tobacco is very hygroscopic. If we had opened the [dry] bale and tried to handle it, the breakage would have been enormous.
Q: So you would never pick this up and handle it?
A: Not anymore. (Laughs) I did it for a sample.
Q: Was it difficult to pick the other tobaccos to go into this blend?
A: No. Everything is planned. We put aside the best binder, the best long filler, to go with this. We've been [doing this] since '94, and in '95 we documented everything—everything is documented in General Cigar—that we must put aside 10 of the best bales that we handle. So when we were working on [the Partagas 160], already the long filler that was going to go with it was part of the process.
Q: Last year, you came out with the Partagas Decadas. Is that the first to use some of that tobacco you've been setting aside each year?
A: That's the first one to use what I had in mind back in 1994. It's to deliver to the consumer something special, something different. The wrapper is 10 years old, the binder is 10 years old. It's just going back, to stay with the basics. Let's not reinvent the wheel.
Q: Speaking of basics, you've taken a remarkable journey, rising to the top of General Cigar. Take me back to growing up as a boy in the Dominican Republic.
A: I was just a kid with a lot of ambition. It comes from my mother. She was a very ambitious lady, and she believed in me since I was a little kid. We are five in my family. My father was a farmer. He grew plantains, a little bit of tobacco, a little bit of everything. My two older brothers were mechanics, and they were very successful. When I finished eighth grade, I won a scholarship to a private school, but I said to my mom, "I don't want to do that, I think I want to go with my brothers and be a mechanic." She said, "You can do that, but you are my only hope of someone to have a life where you wear clean clothes. If you want to be greased up, go with your brothers, but it's your choice." And that's all it took.
Q: So your mother pushed you?
A: My mother used to get up with me at five in the morning to study every single day. And then I enrolled in an agricultural vocational school, with the only conviction that by doing so I would have my secondary degree, which is high school. And if I didn't have enough money to go to college, I could work as an agronomist. And so I did, only with a surprise: the month before I graduated, five Americans came into the room. I was 15 years old, 105 pounds, and they said, "We have a test for a full scholarship to go to Texas A&M." And I won. I didn't speak one word of English, I had never slept away from home, and from a small village in the town of Moca to Houston—it was quite a jump. When I arrived in the United States, it was my first contact with an escalator. That was two hours. Can you imagine, a kid, two hours going up, and down? How can this thing take me up and take me down? (Laughs) It was a lot of fun. Then there were the cowboys. Those were the days of segregation still.
Q: Was it tough?
A: I was too young to understand. In my mind, in my culture, there was no color segregation. That was something, thank God, we didn't have in the Dominican Republic. Since I didn't speak English, whenever the cowboys would talk to me, they realized I was a rare animal. They would come up and say, "What the hell are you?" But I made a lot of friends. I studied agronomy, I graduated, and I went back home, and my first job was in tobacco. I knew that was what I wanted.
Q: Tell me about your early days with tobacco, and then with General Cigar.
A: I started in the Tobacco Institute in 1972, and with General Cigar in 1974. Edgar [Cullman] Sr. [the former chairman of General Cigar] looked at me and said, "You know young man, I'm going to make a tobacco man out of you." And that was so true. Even when I see him today, I admire him so much, because of the sense of quality that he had. I started growing wrappers, then for General Cigar I developed Connecticut shade wrappers in the D.R. It was all natural wrapper, and it had a problem—it did not taste like Connecticut shade. And believe me, Dave, I can, without any mistake, say that until the boom, any wrapper that did not look or taste like Connecticut shade, Cameroon or Sumatra was not a factor on the market. Except, of course, Cuban wrapper. I remember the first reasonable batch, I presented it in 1978 to Angel Oliva. He said, "Daniel, this is a great wrapper, but I can't sell it." It was strong, the flavor was strong. It's different. And that's when we decided in 1980 to move it into candela, because we can use it all.
Q: So it was Connecticut seed, but it tasted much stronger than the Connecticut grown in Connecticut?
A: Yes, due to the soil and the conditions. Back in 1979, we had 135 acres of Connecticut shade natural [in the Dominican Republic]. Extremely good—I wish I could have a crop like that today.
Q: If you had that wrapper today?
A: I would make a fortune. (Laughs) If I had it today that would be fantastic.
Q: People's impressions of tobacco have changed dramatically. What changes have you made?
A: General Cigar, for example, 1958 through 1994, we had two basic blends. Just two blends. We had Partagas, and we had Macanudo. Very consistent, always using the best tobaccos, but it was Connecticut-shade wrappers and Cameroon wrappers. And we were the leaders in the market. I remember sitting down with Edgar and Edgar [Cullman Jr.], and saying, "How many decades are we going to be just that? We have to open this portfolio."
Q: What did they say when you said it was time to expand the blends?
A: They gave me the go-ahead, and there was no limit on resources. Of course, anything that could actually damage or do anything with Macanudo was a no-no, and always the philosophy was if it is going to be new, we're not going to just change the packaging or change the sizes. We decided the only way was to start from scratch—developing new, proprietary types of tobaccos.
Q: Where did you begin with these changes?
A: One of the biggest accomplishments is the Havana seed grown in Connecticut. Havana seed was brought into the U.S.A. right after World War II, and it adopted a lot of characteristics from Connecticut, and it was crossed. I started with our R&D department, and [in 1994] we grew 240 [plants from] different types [of seeds], and we started evaluating. The first year was 240, and [in 1995] we went up to 600. [With the Havana seed], the characteristics of those leaves in the field, and the aroma in the shed, was so outstanding, that I said, I'm just going to keep working with this, to somehow use it in a blend, because it's so unique. That's why that seed was put aside as a project.
Q: And that Havana became the wrapper for Partagas Black?
Q: Where did you get these seeds?
A: It was part of the Bayuk Co. Each company used to have inventories of seeds.
Q: So to get a taste for the future you looked to the past.
A: I keep an eye on the future, and two eyes on the past. I don't believe in the present. It has no importance to me. It is ephemeral. When I think about the ultimate cigar, I think about a great marriage between the very best grown in Cuba and the very best grown in the Dominican Republic, as far as long fillers, wrappers and binders. In the meantime, we have already developed new types of tobacco like the Havana grown in Connecticut, the Havana grown in San Agustin [Honduras], the Havana grown in Ometepe [Nicaragua], and the Havana grown in the Dominican. Could you imagine a scenario where some of those tobaccos could be blended with a good Cuban from Remedios, and maybe a good binder from San Agustin, and maybe a wrapper, one leaf from somewhere, and just play with those concepts? Since '94, I've been developing different seeds, and I do believe strongly in Havana-seed flavor, so I grow it in different countries, I have crossed it with Connecticut shade. Some of those crosses are outstanding.
Q: You've used many of these different tobaccos for new products, which I'd like to talk about. Consumer expectations for new product are certainly different from when you first came into the business. Is there pressure to come out with something new every year, and if so, is that good or bad for the market?
A: No, there is no pressure. This year we have one new product from Dominican. There are two things we have developed since 1994—tobacco and people. There is no rush. Our bread and butter, the flagships, are still Macanudo and Partagas. And, of course, out of Honduras, Punch. Once again, when we purchased Villazon, it was Punch, Hoyo de Monterrey and Excalibur. Three brands. Now, today, we have the Rare Corojo, the Sumatra, the 1066. That portfolio has been expanded, without any rush. And if you take a Black Label today—it's been three years in the market—it's our commitment that it should taste the same as the first one. It should follow the path of Macanudo and the philosophy of quality and stability.
Q: Is that the most difficult thing about this business? That a Macanudo Hyde Park Café should taste the same today as it did six months, a year ago?
A: Twenty years ago. I keep boxes from every year, and we all test it. That's sacred. We can't play games with that. There is just no way we will change Macanudo—if you smoke one today, it should be the same.
Q: And there's no magic formula?
A: No, you have to play with it. That's why you need four years of inventory, to keep it stable. Because you will have crops that will be a little bit heavier, a little bit lighter, and you make adjustments.
Q: I know you have to make adjustments, but are they ever so dramatic that you change a country?
A: No. We might eliminate a crop, as we did in '98. Not one Macanudo was made with '98 crop. Not a single one. And I can tell you that this event represented a tremendous financial loss. Because not one leaf made it to the minimum standard of Macanudo.
Q: That's a huge decision. What happened in '98 to cause that?
A: It was a bad year, not only in Connecticut, but also in Dominican and Mexico. In Cameroon. That was when El Niño hit. I still have piloto Cubano tobacco left from that. I'm going to use it all for short filler.
Q: The wrapper was sold for machine-made cigars?
A: It was very thin and brittle. It was a disaster. And the question was, do you protect the product, or is it just a business? I understand both of them, but business is long term. We are in business for many years, so that's the only thing you protect.
Q: You could have physically made cigars from it?
A: They would break, and the taste would have been horrible.
Q: This is why you need that big inventory.
A: Yes, as bad as it is, it doesn't hurt production.
Q: Now to show how fickle the tobacco world is, wasn't 1999 a very good year?
A: Ninety-seven. We were blessed in '97, and we were hit in '98. That's what tobacco is all about. And that's where the vintage concept comes from. We grow tobacco everywhere. I'm the president of the company, but I'm still a farmer, I'm still a processor.
Q: I've been in tobacco fields with you, and the pleasure you have there is obvious.
A: I enjoy it. I'm one of the few on this planet who enjoy the whole cycle, and do the whole cycle. I have great passion for growing, but I have extremely great passion for processing. Manufacturing, I love it, and finally getting in contact with consumers and customers, that was probably my only question. Then I found out that they share my passion, and they complement and they help, because they tell the story.
Q: What does it mean to be the head of a company that makes a product for a consumer that has that level of passion?
A: It's a great compliment, and it's a lot of weight on my shoulders. Now that I'm more responsible for numbers, and the bottom line, I have to make sure that it's not compromised. If I do damage to the product and the image, I would feel guilty. I work hard to make [numbers for] the year, but if anything happened on that, I think I have enough to work harder and deliver whatever we are short. If we actually betray the consumer, I don't think I would ever forget that.
We have a great group of people. We are 52 at a management level. Sometimes I feel guilty, because I take the credit, but there are so many people. If something happens to me, nothing happens to General Cigar. Someone will step up. But before that, we need to have people ready to call the shots. We meet every week, and we talk, and we talk. I actually push them to the limit as far as getting ideas. And our meetings are loud. I love when people get passionate. For new product meetings—Cohiba Black, for example—we have six prototypes, and we have 12 people in the room. I push them to be critical, and they start fighting. We get it to six, then four, and from four to two, during four meetings, every eight weeks. As a matter of fact, I don't have a vote.
Q: You don't have a vote?
A: No. I have a veto. (Laughs)
Q: That's the most important thing! I know you don't want to talk about specific numbers, but I'd like to talk in general terms about the U.S. market.
A: We're doing fine. I'm very pleased, but it's early as you know, and we have two quarters to go. We're very optimistic.
Q: Last year was a very good one for the U.S. premium cigar market.
A: 2004 was even better. Let's remember 2000, it was depressed, and there was a lot of anxiety, and probably some mistakes were made again. Two big, big decisions were made by the Cullmans from a financial point of view: not to use the '98 crop, and to take that high inventory of tobacco we had, demote a lot of it to short filler, and take whatever was left to re-sort again and take whatever was not desirable out. And that cost huge money. We had nine years of inventory on hand, and we made a decision to continue growing every single year, and get rid of whatever was poor tobacco. Today we could say it was the best decision we ever made. We have five years' inventory, and I see the industry going into constrained supply while we are in one of our greatest positions.
Q: So back when the market was depressed, you got rid of mediocre tobacco and kept on growing?
A: And on top of that we bought Copata [a company in the Dominican Republic that grew tobacco], to meet our needs. That company, 100 percent of what it grew went to General Cigar, but we paid a management fee. In 2001, we bought it, brought in our technicians, and now we are growing to our specifications. We invested millions of dollars from 2001 to 2006 just in long filler in the Dominican Republic.
Q: That's a big investment to make.
A: Because we are looking to the future. I can assure you, in 2000, 2001, 2002 and 2003, I was called the crazy guy in the industry. In Honduras and Nicaragua, I started in 2001 when long filler was being sold at $2 [a pound] and there was a huge amount in inventory. That's when we started new farms, new setups with Nestor Plasencia.
Q: That takes a lot of guts. Did you think the market would come back at that time?
A: My only thinking was to produce the best cigar. To do that, it's a simple thing. At the end of the day, all the improvements and big things in society have come after depression. Those who actually invest, put the money where it belongs, a few years later will be the ones who are happy. It's no time to roll back—those are the times to grow. You suffer a couple of years, make the changes, get the right people, train people.
Q: What's going on right now in the market? There are smoking bans everywhere, but despite the bans
A: The business is strong. It's very strong. People are more knowledgeable, they're looking for better and better quality, and that has a lot to do with your company. [Cigar smokers are] more specific, they're more refined, and that's the time to provide something that has to be better, that has to be different.
Q: Where would General Cigar be had you not made those decisions?
A: I wouldn't want to think about it.
Q: You'd be short of tobacco?
Q: Would it be possible you wouldn't be able to produce enough Macanudo and Partagas cigars?
A: Yes. Put it this way—my average prices of tobacco now are lower than the market, and the quality is superior. And the quantity is as much as I need. If the market had another boom now, I would be in the position to say "How much?" With the right tobacco.
Source: Cigar Aficionado