H. Upmann: Germans in Cuba’s Tobacco Industry


25/02/2014

During the 19th century, German businessmen showed great interest in the largest Caribbean island, especially lured by its natural resource, its geographical location and its sugar industry.

Big-time investors out of Germany forked over lump sums of money in the railroads, the brewing industry, the manufacturing of ropes and in several sugar mills, eventually becoming the new owners.

A token of that presence was the fact that a German entrepreneur founded the Matanzas Aqueduct in 1871; another one became one of the landowners of today’s celebrated Varadero Beach, long before it was established as a town back in 1887.

In the realm of commerce, it’s important to highlight the hefty ties forged between Cuba and Germany as far as tobacco was concerned. By the end of the 18th century, Cuba was exporting considerable amounts of loose tobacco. In his work Contrapunteo cubano del tabaco y el azúcar, Cuban sage Don Fernando Ortiz writes: “In Germany, the habano-type Cuban cigar soon got a good market. In 1788, a man named Schlottmann set up a factory for them in Hamburg with bales coming from Cuba. In time, Hamburg turned out to be a major tobacco trade hub, shipping factories to Havana that grew roots here as they opened bale warehouses, factories that churned out exquisite vitolas and even banking houses to finance their business.”

By the end of 1859, Cuban exports of loose tobacco peaked 13,549,670 lb., with 3,927,232 lb. bought by Germany. However, it must be noted that amount was not entirely shipped into the German market. There were German distributors and dealers selling the product to other European countries.

In the history of trade and financial relationships between Cuba and Germany, Bremen-based H. Upmann Co. was actually the first foreign company –ruling out the Spanish companies that set up shop on the island nation at the time since Cuba was a Spanish colony- to chip in foreign capital straight into the domestic tobacco industry.

The H. Upmann Co. played a remarkable role in Cuba’s business life, linking trade and banking, until the company eventually set up shop in 1868. The Upmann brothers –Herman and August, born in Bremen, cut their teeth in the tobacco industry on March 1, 1844, in Havana, though the H. Upmann cigar factory’s foundational license was reportedly approved on May 9 of that same year, by the island’s Captain General Leopoldo O’Donnell. At that time, there were an estimated 1,800 cigar factories in the country.  

With its famous habano, the H. Upmann factory pried successfully into the most demanding foreign markets. That marked the beginning of a new item of production and exportation. 

There was a noteworthy fact that speaks volumes of the tremendous prestige and economic drive the H. Upmann trademark garnered. Between October 1883 and the year 1891, the company bought off other cigar brands, according to Cuba’s Marketing Records from the 19th and 20th centuries. 

In that context, another German national, Luis Mark, made a major contribution to Cuba’s tobacco industry. 

By 1890, in the face of the tobacco market’s demand, mostly in Germany and the U.S., there was an impending need to get a lighter-hued variety of tobacco leaf without letting go of its necessary strength. In a word, experts were looking for an evener leaf, quite an unprecedented development up to that very moment.

After a number of tests and following the introduction of new techniques from the U.S., the use of cheesecloth (shade-grown tobacco) eventually yielded the anticipated outcomes. 

Relying on that experience, Luis Mark embraced that technique in his farm in the territory of Alquizar, in the province of Habana. The results couldn’t get any better and the method rapidly spread out to other locations as planters realized the great benefits it could bring on the outputs of wrapper leaves. Marx’s lands grew to have the most extraordinary wrapper leaves no other producer could come up with. 

With Herman Upmann’s return to Bremen and his demise in 1894, his sons (Herman and Albert) traveled to Cuba to pick up the family business where their late father had left off. It was 1897 and Albert had also decided to come back home in Bremen as he noticed that his nephews were up to the job. However, he remained at the helm as general manager of the Upmann banking house and the H. Upmann cigar factory. 

By the end of Cuba’s Independence War (1895-1898) against the Spanish colonial rule, Herman Jr. found himself under the strain of the American and British trusts that were trying to talk him into selling the company, though he never gave in. By that time, another German national, Heinrich Kaufen, had partnered with the H. Upmann company.

The 1890s marked the beginning of American financial interests in the Cuban industry, a situation that ramped up dramatically with the concentration of U.S. capital in the tobacco sector through the purchase of factories, brands and tobacco plantations to produce the kind of leaf America needed for its own tobacco industry. 

The first antecedent of that move can be found in the merge of El Aguila de Oro and Henry Clay cigar factories in 1887, a move that gave birth to the first public limited corporation entirely devoted to the tobacco business.

At that time, the H. Upmann factory –the trademark had put a German national named Paul Meyer at the helm- was located in a two-story building, outfitted with a basement, right on a block hemmed in by the Belascoain and Carlos III avenues, as well as the San Carlos and Estrella streets. Known among cigar rollers as La Madama, the building was next a cigar-making workshop founded as the Upmann-Kaufen compound and named Flor del Pacifico. 

With the end of the World War I in 1918, Cuba’s economic situation was dramatically desperate, especially following the big crash that brought about unfathomable consequences and tribulations on thousands of workers who lost their jobs. Due to these hardships, the H. Upmann Co. –like so many others- went belly up in 1922 and was sold off for a meager 30,000 pesos. Three years later, on September 3, 1925, Herman passed away and his brother Albert moved to the U.S. 

The abovementioned predicament led the H. Upmann cigar brand to change hands continuously for a number of years, jumping from British to Spanish and German owners, including Otto Brades and Paul Meyers. From that moment on, the factory was never again an exclusive German property. 

In 1935, the Menendez y Garcia Spanish family bought the H. Upmann cigar factory. In 1944, within the framework of the factory’s centennial anniversary, the company unveiled a new building on 407-409 Amistad Street, in the city of Havana. 

Famous in Cuba since the 19th century, especially for the superb quality of its hand-rolled cigars, brand names like H. Upmann, La Corona and Partagas had caught on quickly among American and European aristocrats.