Thursday, March 11, 2010

1, 2, 3, 4...Let's start a rum war!

(Sorry, I had to do the faded Havana Club logo for dramatic effect)

Here we go again...Bacardi & Pernod Ricard are at it again. Who owns the famed Havana Club name?

The Miami Herald went into the legal aspects in depth (here). I have another view...

So let's go over this interesting argument...

Okay, the Bacardi's get pushed out during the revolution and Castro nationalizes mostly everything that made Cuba great. The rum maker and distillery where Havana Club was made are owned by Arechabala. The Arechabalas leave for the States after the revolution. In the meantime, the Cuban government forms Havana Club with Pernod Ricard and the Arechabalas sell their recipe and trademark to Bacardi. Pernod Ricard, Bacardi and CubaExport have been fighting ever since. Pernod's and CubaExports defense is that the trademark lapsed in 1973, giving them free reign over the name.

Now with that being said...
Here is another recent article in the Herald speaking about Diageo blaming Bacardi for sabotaging tax subsidies when they wanted to move their distillery to the U.S. Virgin Islands from Puerto Rico. Read the article here.

So...What is going on in the rum world? Why is everyone attacking Bacardi? Why is there a rum war?

Well if it's a secret, let me let you in on it. Rum is the hottest new spirits category in the world. The growth has been larger than many of the other spirits. I did some research for you and look what I found:
Havana Club managing director, Marc Beuve-Méry says: “If you look at the past ten years the growth of rum as a category was 50% above the market average for spirits, according to [The IWSR’s] numbers. Rum’s growth over that period was 3.8% and the global spirits market being 2.5%. So rum’s growth is roughly 50% above spirits’ average. That’s impressive. And there has been an acceleration between 2005 and 2007; that’s even better.” Source


The US rum market has been one of the star performers in the US drinks market. In 2007, it rose 5.5% to 22.7m nine-litre cases. 89.8% of the market is sourced from locally produced rums, including rums from Puerto Rico and the US Virgin Islands. This sector, at over 20.4m cases, rose 4.8%, but the imported sector showed much faster growth, soaring a further 12.1% in 2007 to just under 2.3m cases. Source


Remember, rum used to be a small market for Central American & Caribbean countries. Soon you will start seeing countries you would have never thought in the rum category. I have noticed a larger trend for sipping rums. In Miami, I have noticed whisky drinkers swapping for a nice aged sipping rum. Have we gone mad? Rum to sip, give me a Cuba Libre right? I have a couple of names for you that won't disappoint. Atlantico, Ron Zacapa, Oronoco, Diplomatico, Flor De Cana, Pampero, Santa Teresa. There are plenty more! Start there and open up your senses. You are going to start noticing a trend where the vodka space in a back bar gets a bit smaller to make space for a bigger rum section. Bartenders, take notice, you need more space for rum! Show off those beautiful bottles and get with it! I don't want to side with one company or the other but this is a good war to have. This should create some competition, I will sit back and enjoy the new rums that will be debuting within the next couple years. Drop a line so I can get a bottle to review.

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