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Haiti economic upheavals don't make dent in rum exports
Journal of Commerce / April 14, 1999

By Larry Luxner

PORT-AU-PRINCE, Haiti -- It may be a contradiction, but the Western Hemisphere's poorest nation produces one of the world's most expensive rums. And Haitian-born Thierry Gardere says thirsty U.S. and European rum connoisseurs can't get enough of his company's prized Rhum Barbancourt.

In fact, says Mr. Gardere, annual production has nearly doubled from 85,000 cases in 1993 -- at the height of an OAS-led embargo of Haiti -- to around 165,000 cases last year.

Granted, that won't cause many sleepless nights at Puerto Rico's Bacardi Corp., which last year sold 8 million cases to the U.S. market alone. But it's a big deal to Haiti, where annual per-capita income is only $250 a year.

"We are the only producer of rum for 7.5 million Haitians, but we don't sell to more than 200,000 people here," says Mr. Gardere, the distillery's director-general. "Most people in Haiti drink a rough rum known as clairin, which isn't sold in bottles but in barrels. Locally, our competition is not rum, but rather whisky and gin, and that's sold on the black market."

Barbancourt isn't the only exotic product manufactured in Haiti. In the northern port city of Cap-Haitien, oil is extracted from orange peels for use in Grand Marnier and Cointreaux liqueurs. And vetiver, an essential oil in perfumes, also comes from Haiti.

But Barbancourt is one of Haiti's best-known exports. Coincidentally, Barbancourt was established in 1862, the same year Don Facundo Bacardi founded his own rum distillery in Santiago de Cuba.

"Dupre Barbancourt was a Frenchman from Cognac. When he started distilling here, he tried to do it the same way cognac was done," said the 46-year-old Mr. Gardere, a fourth-generation Barbancourt executive whose father built the current distillery in 1949.

Unlike other rums, Rhum Barbancourt is aged in French white-oak barrels, using a double distillation process known as charentaise.

"We don't use molasses. We distill directly from freshly crushed sugar-cane juice, and have special yeast particular to this area that gives a particular taste to the rum," he said. "We have our own 200-hectare plantation of sugar cane, and 30% of the cane we crush is from our own plantation. Then the cane goes through a mill. From this mill, we extract the juice, and from there it goes to a fermentation tank where it stays about three days. Then the distillation process begins. From there, we age the rum in white oak barrels."

Today, Barbancourt has annual sales of $6 million -- up from $3 million in 1990 -- and employs 200 people at a distillery near Port-au-Prince International Airport. Because of a recent increase in violence, the complex is now protected around-the-clock by guards armed with machine guns.

Indeed, Barbancourt has survived some tumultuous times, most recently a total economic embargo declared against the Haitian military government in October 1991. The blockade, enacted by the Organization of American States, was intended to force the return of exiled President Jean-Bertrand Aristide.

"We were not allowed to export to the United States or Canada," Mr. Gardere recalled. "During the last four months of the embargo, even Europe joined in, so we couldn't export to anybody. The market was very depressed. We had no electricity, so we used gasoline-powered generators, but gasoline was $10 a gallon. And it was difficult to get spare parts. The embargo finally ended in October 1994, when Aristide returned. Then we had to restart everything."

Even now, with no restrictions on trade, exporting from Haiti is a huge challenge.

"For two years, the economy was improving, but during the last year, all international assistance has been blocked because we're waiting for a new government," said Mr. Gardere. "The Haitian private sector is not strong enough to get the economy moving. A lot of infrastructure is missing here: electricity, telephones, water and roads."

Overseas, Barbancourt's main rivals in the rum market are Mount Gay from Barbados, Jamaica's Appleton Estate and Bacardi's Gold Reserve -- all of which compete in the duty-free markets of St. Maarten, St. Thomas, the Bahamas and Panama.

At present, only 48% of Barbancourt's production is exported, mainly to the United States and Canada. Barbancourt sells especially well in Montreal, which -- being the world's second-biggest French-speaking city -- also has a substantial Haitian immigrant population. Except for duty-free purchases by departing tourists, most of this rum leaves Haiti by ocean, via Sea-Land, Hapag-Lloyd, CGM, Seaboard Marine or Zim Lines.

Three kinds of Barbancourt are sold in the United States, ranging from three-star, which is aged four years and retails for around $12-14, to Estate Reserve, aged 15 years and sold for $26-28 a bottle. The company also hopes to introduce a white rum for the first time, which will sell in the U.S. market for around $19 a bottle.

The United States currently buys about 15,000 cases a year, but thanks to efforts by Barbancour's new distributor, Crillon Inc. of New Jersey, Mr. Gardere says "we think we'll be at 20,000 to 25,000 cases in 1999, and 30,000 cases in 2000." Main U.S. markets are the New York metropolitan area, Boston and South Florida.

In addition, the company will soon begin exporting to a natural market for its premium products: France.

"We never exported to France because of competition from the French overseas departments of Guadeloupe and Martinique. But now it's easier, because Haiti is part of the Lome Convention," Mr. Gardere explained, adding that 1999 will also mark the beginning of Barbancourt exports to Spain, Germany and Belgium.

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