With the United States and Cuba announcing plans to restore diplomatic relations, some Napa Valley winemakers are weighing the Caribbean nation’s potential to become its newest market – small and impoverished though it may be.
Amid a host of American corporations poised to enter or re-enter a market largely denied them for half a century, local wineries are beginning to look into future sales through Cuba’s tourism and restaurant industries.
Commerce with Cuba has been tightly restricted since shortly after the 1959 Communist revolution, which led the U.S. to break off ties four years later. But on Wednesday, the two nations said they would reopen embassies, loosen some export curbs, permit more U.S. travel licenses for visits in Cuba, and allow American firms to open accounts with Cuban financial institutions.
Two members of the Napa Valley Vintners trade group said a visit by about 20 Cuban sommeliers in July drew attention to rising interest in California wines. Invited to the North Bay by Californians Building Bridges, a cultural exchange group run by Darius Anderson, the Cuban contingent toured wineries, took part in tastings and visited several wineries accompanied by the Vintners.
With the expansion of Cuban tourism has come an even more rapid growth in the number of privately owned restaurants, or paladares – from about 25 to 400 such eateries in the 18 months before the sommeliers’ visit. Members of the Cuban contingent expressed their hopes that loosened economic sanctions would allow California wines to be more easily distributed in their restaurants.
Despite such enthusiasm – and this week’s political thaw – any winemaker contemplating a move into the Cuban market must overcome numerous roadblocks.
Patsy McGaughy, spokeswoman for the Vintners, cautioned winemakers not to expect any quick results in a country where a lower standard of living largely limits wine sales to tourism outposts.
“While we certainly believe every fine restaurant in the world needs to have Napa wine included, even if the Cuban market opens up, the volume would be very small,” said McGaughy.
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Mature and affluent markets like Japan and the United Kingdom will continue to hold the Vintners’ main attention for exporting, she said, “but we’d be interested in making sure Napa wines have a place in restaurants in Cuba as well.”
As an agricultural product, wine is exempt from the trade curbs that since 1963 have blocked most U.S. industrial exports to Cuba, according to Richard Ward, co-founder of Saintsbury Winery. But American foodstuffs, like manufactured goods, still cannot be purchased on credit in Cuba, putting U.S. wine sellers at a disadvantage compared to peers in Europe, South America and Australia.
“What’s been proffered so far is setting up regular diplomatic relations, which will ease some of those hurdles,” said Ward. “But the regulatory hurdles probably are not going to be changed immediately. A fair number of those are dictated by the embargo, and it’s the Congress that has to lift embargo; can’t be done by executive action like establishing diplomatic relations can.”
For U.S. wineries even to think about arriving in Cuba, numerous unknowns, such as taxation and financial credit, must be resolved first, according to Amelia Morán Ceja, president of Ceja Vineyards.
“These are uncharted waters,” she said. “There are a lot of challenges to exporting wine, period, and I’m sure this (market) is even more challenging – no one has exported there for over 50 years. Those logistics like shipping and taxes aren’t established yet. If indeed this is approved, it will take, just from my own export experiences, a number of years to get everything established.”
Still, after meeting Cuba’s wine enthusiasts earlier this year, Ceja considered the nation worth considering for future sales – particularly with its traditions of culture, tourism and cuisine.
“For me it would be wonderful to have a market there,” she said. “I love to travel and being able to promote our wines on a lovely island with great culture and food, that would be ideal for me.”