The Agave Panic of 2018: Bloodshed on the Streets of Tequila

Bloodshed

The Agave Panic of 2018: Bloodshed on the Streets of Tequila https://wp.me/p3u1xi-5mAOn Jan. 22, 2018, a particularly savvy tequila brand owner announced in a private message to this office:

“Agave prices out of control.  $22/kilo.  Industry getting destroyed!”

Coincidentally, earlier that same day, another brand owner/ambassador admitted to us that the current cost had blown up to $24/kilo.

That savvy brand owner then added to his message–

“…but Cuervo started it.  Bought up a ton of [agave] before their IPO.  Increase balance sheet.  That’s, at least, the word on the street.”

But, shit got REAL for Jose Cuervo when…

Cuervo Cries Wolf

In this El Financiero article dated December 21, 2017, Francisco Beckmann Vidal, owner of Tierra de Agaves and Jose Cuervo, warned of a looming agave shortage.  He…

“…urged agave producers to increase plantings because whether in tons or in number of agaves, the industry requires more of your prime material.  Planting must begin now.  Eyes have to be opened and decisions need to be made.  Only the industry can provoke the necessary changes.”

[“…instó a los productores agaveros a que incrementen los plantíos porque tanto en toneladas o en número de agaves la industria cada vez requiere de más de sus materia prima, “hay que empezar a plantar desde ahorita. Hay que abrir los ojos y tomar decisiones. Solamente la industria es la que va a provocar estos cambios que se necesitan hacer.”]

Like Shaggy said–

It wasn’t me!

 Here’s Your Sign

All the signs of an impending shortage were there.  Major spirits distributors, tequila and even mezcal brands jockeyed for position in the Agave Triple Crown race.

In 2015, Diageo, the world’s largest producer of spirits, swapped its Bushmills Irish The Agave Panic of 2018: Bloodshed on the Streets of Tequila https://wp.me/p3u1xi-5mAwhiskey brand for Don Julio, previously owned by José Cuervo.

After Cuervo’s early February 2017 initial public offering, Davos Brands acquired a controlling interest in Master Sommelier Richard Betts’ Sombra Mezcal and Astral Tequila brands, in March.

Then, in early June 2017, spirits and wine behemoth, Pernod Ricard, purchased a significant stake in founder Ron Cooper’s beloved Del Maguey Single Village Mezcals amid uproar from long time fans claiming “sell out.”

Later that June, in a surprising move, Diageo bought Casamigos tequila, co-founded by celebs George Clooney and Rande Gerber, for up to $1 billion.

All this time, Bacardi, lurking like a shark in the water, in January 2018, bared its jaws and swallowed up Patron for a reported $5.1 billion.

The Agave Panic of 2018: Bloodshed on the Streets of Tequila https://wp.me/p3u1xi-5mA

Pernod Ricard, in an attempt to get the last word in January 2018, shelled out the big bucks to purchase the remaining 16% of Ken Austin’s Avion tequila that it had invested $100 million in back in 2014.

M & A was the name of the game in the spirits distribution sector, too.

Late November 2017 brought the news that distributor Breakthru Beverage was set to combine with Texas based Republic National Distribution Company to match 2016’s mega-merger of Southern Wine and Spirits with Glazer’s, Inc.

Real, or Fake?

Some skeptics still don’t believe that an agave shortage exists.

Unlike the more seasoned, and–dare I say–older sippers, this may be the first time Millennials and Gen Xers have ever experienced a truly severe Agave Crisis.

Others completely ignore the fact declaring an upcoming tequila boom, instead, instigated by the Big Three named above.

Even in this article in the Spirits Business, Vinexpo, the leading wine and spirits trade show, and IWSR (International Wine & Spirits Research) predict that:

“The fastest-growing spirit category in terms of volume will be Tequila, which is predicted to increase by 118% between 2016 and 2021 to 35m cases.”

Seriously?

 Thank You, Captain Obvious

We told you last year this was coming.The Agave Panic of 2018: Bloodshed on the Streets of Tequila https://wp.me/p3u1xi-5mA

Weren’t you paying attention?

In the article The Agave Shortage of 2017 Is Worse Than We Thought we outlined the reasons for the then looming crisis.

Still, you bought ALL the tequila and mezcal you could drink, didn’t you?

The Numbers Don’t Lie

According to DISCUS, 17.2 million cases of tequila were sold in 2017.  3.2 million of those cases were in the pricey Super Premium category, alone.

Must have been a good year for some of you.

On the Mexico side of the border, things aren’t so rosy.

Freak Out

According to these articles in Joe  , Telam , and Reuters

“This year [2018], a total of 42 million agave plants were projected to supply 140 registered companies.  However, only 17.7 million of those planted in 2011 are ready to be harvested, the Tequila Regulatory Council and National Tequila Industry Chamber have said.”

That’s assuming producers are using full grown agave.  As explained in the above articles–including our own–2 to 4 year old immature agaves are being sold, as well.

With the use of diffusers by the large producers like Sauza and Bacardi (Cazadores), the age of agave plants used to make tequila is irrelevant.

The Agave Panic of 2018: Bloodshed on the Streets of Tequila https://wp.me/p3u1xi-5mA

About Those Stolen Agave

For several years, now, growers in Oaxaca had reported that truckloads of stolen (or purchased) espadin used to make mezcal were headed for tequila distilleries in Jalisco.

Now, a reported 15,000 blue agave plants have been hijacked from blue agave growers supplying the Big Boys.  That’s triple the amount reported in 2016.

It is presumed that these pilfered plants were going to los mieleros (Big Pharma) since they pay bigger bucks for blue weber agave.

So, there is some poetic justice during this Agave Crisis.

 The Blame Game

As much as major metropolitan areas would like to believe that they carry this much clout, cities like New York are NOT to blame.

On the other hand, brands like Houston based Pura Vida blames the Big Guys, too.

Austin based Dulce Vida tequila agrees.

And, one more for good measure from this small brand owner via LinkedIn on February 5, 2018:

[“The sad reality for small producers that depend on purchasing ripe agave that results in extraordinary 100% blue agave tequila is that the Large Makers are the ones who have stockpiled huge quantities of premature agave.  But the 4 year old plants don’t yield good tequila.  Moreover, it requires double the amount of prime material [agave] for the production of tequila.  In short, the very same Large Producers have aggravated the problem and devastated the cultivation of blue agave.”]

While we’re pointing fingers, let’s accuse the real culprit of this economic and agricultural mess, shall we?

Greed

In October 2017, we spoke to Master Distiller of G4, Terralta, and Pasote–and agave grower–Felipe Camarena.

Minutes before the VIP Hour of El Cholo’s yearly Tequila Tour began, he briefly outlined to me in simple mathematical terms, how much per kilo he’d require to make a nice, honest living growing agave.

The amount was not unreasonable.  In fact, it was in the single digit range.

By waiting at the last minute, and selling to the highest bidder, Camarena blamed the greed of amateur agave growers for the skyrocketing maguey prices.

How Long?

How long will this agave crisis last?

In January 29, 2018, Master Distiller of Tapatio and Tequila Villa Lobos, Carlos Camarena, gave this gloomy prediction:

What… Me Worry?

The Agave Panic of 2018: Bloodshed on the Streets of Tequila https://wp.me/p3u1xi-5mA

Not everyone is worried, however.  Pernod isn’t

And neither are George and Rande.  Having pocketed their nearly $1 billion, they’re venturing into mezcal, now.

The Agave Panic of 2018: Bloodshed on the Streets of Tequila https://wp.me/p3u1xi-5mA

Be afraid–

Be VERY afraid!

Learn all about tequila from field to glass and then get paid to share your love of agave spirits with others! Buy Them Both Now!

Women in the Tequila Industry: Cleo Rocos

Cleo in Pool with AquaRIvaActress, comedienne, narrator, pop music collaborator, singer, producer, writer, world traveler, radio announcer, book author, and tequila brand owner.  Those are just a few of Cleo Rocos’ credentials.

Best known for her years as a sidekick on the BBC’s beloved Kenny Everett Television Show, she is often compared to Lucille Ball for her beauty, wit and business acumen.

Her circle of friends range from kings of comedy, queens of countries, princes ofCleo_Emma industry, and girls of spice.

Learning from a prized friend and mentor, Tomas Estes (Tequila Ocho), she established The Tequila Society in the UK, and launched her own AquaRiva tequila in 2012.

This Tequila Boss Lady pulls no punches when it comes to 100% agave tequila.  Here, she shares her views on our customary handful of questions.

***

TA:  How would you describe your experiences as a woman in a primarily male dominated industry?  What are the challenges you face when dealing with the male dominated Tequila Industry?

CR:  Everyone assumes that because Tequila is a male dominated industry that I would have to face challenges.  I love men and working with them.  I have always been treated with great respect and my thirst for knowledge willingly nurtured by everyone that I have met.

CleoCertificate

In fact in 2009 I was recognized by the CNIT with a coveted award, presented to me at the annual Dia del Tequilero, in Guadalajara.  A great honour.

I love the people in the tequila industry.  I spend a lot of time in Mexico and I have never encountered any negative experiences as a woman.

The tequila industry is cool and some of the coolest people in it are older than your grandparents and can show you how to really party.

It is well recognized that people live long and happy lives in this industry.

TA:  How have you been able to change things within the Tequila Industry?

CR:  I have been able to change things extensively in the UK, turning around theAquaRiva_Syrup negative misconceptions by relentlessly explaining the dramatic difference between mixto and 100% agave tequilas and encouraging people to actually give tequila another try.

I actively get the tequila message out to a much wider audience through my career in television.

I appear on many TV and radio shows, write articles and give interviews explaining the truly exquisite experience of a well crafted 100% Agave Tequila.

TA:  What do you see as the future of women working within the Tequila Industry?

CR:  If you are a woman who can bring something to the tequila industry and have a real passion for it then there are great opportunities as there are equally for men.

CleoRocos with Richard Branson enjoying the worlds best tequila AquaRiva copyMost people are not aware that women have a more sensitive and accurate palate than men.  It is a fact of nature.  Many more women are now top tasting and spirits profile experts throughout the wine and spirits industries.

TA:  What facets of the Tequila Industry would you like to see change?

CR:  The most important facet to change is to implement legislation demanding the clear labeling Mixed Tequila [mixto] as “MIXED” or even “Tequila FLAVOURED.”

Mixed tequila is generally only 51% agave tequila and not the “real deal.”

This lack of label clarity is highly confusing for the new consumer and detrimental to the tequila industry.

The experience of drinking “Mixed” Tequila is why most people think that they hate tequila.

It is unfair to the producers of 100% Agave brands to have to constantly battle to re-educate consumers due to this lack of label clarity.

TA:  Do you approve of how tequila brands are currently marketing themselves?

CR:  Each brand obviously has their own marketing strategy.  We all know that good 100% agave tequila is to be sipped and enjoyed.

The versatility of this incredible (100% agave) spirit is having a profound influence on cocktails globally and is now the favourite spirit of top bartenders.

I do not agree with promoting rounds of inferior mixed tequila shots to CleoBarrelscustomers to shoot down in one go.  This gives Tequila a bad reputation.

I always warn against any drink having to be consumed ice cold or in one go.  No one needs to drink like that unless they are going to have a limb removed without an anesthetic.

TA:  Is there anything you’d like to say to women who may be contemplating entering and working in the Tequila Industry in one form or another?

CR:  I have been very welcomed and totally embraced by the Tequila Industry.

I have created my own multi award winning brand, AquaRiva Tequila and I have only experienced good will and encouragement all the way.

If you have a true passion, a desire for knowledge and to work with this glorious spirit, there are no barriers.

I love working in this industry.  It’s crammed with enthusiastic people, family traditions and amazing characters.

Cleo_Bottling

The tequila industry is very much a way of life but not as you know it.

Learn all about tequila from field to glass and then get paid to share your love of agave spirits with others! Buy Them Both Now!

Women In The Tequila Industry: Ana Maria Romero Mena by M.A. “Mike” Morales

Tequila Appreciation, 2010
Tequila Appreciation, 2010

In the 2010 industry classic special report entitled Tequila Appreciation for USA Today, it listed five tequila trends to watch.  Here, we’re focusing on one of them…

The role of women in the tequila industry.

The report predicted that more women, in particular Latina/Hispanic women with family ties to agave growers and tequila producers, would join the ranks of tequila brand owners and also become influential in other areas of this traditionally male dominated industry.

Current numbers suggest that 70 percent of new businesses are started by women and that 20 percent of new home sales are driven by single women.  It’s no secret that Hispanics and Latinos are also the largest US minority, either.

Up to 85 percent of the buying market is women.  This translates to $5-$7 trillion dollars every year!  It’s no wonder that the Spirits Industry, and particularly the tequila segment, is finally taking notice.

Statue of Mayahuel in Tequila.
Statue of Mayahuel in Tequila.

We asked a short list of five questions to prominent women leading the charge for change in the Tequila Industry and beyond.  As you’ll read, it hasn’t been all margaritas and roses for these tequila boss ladies.

We begin our series of Women In The Tequila Industry with Maestra Tequilera, Ana Maria Romero Mena.  You can read a brief summary of her accomplishments in our earlier article on Tequila Boss Ladies.

[Editor’s note:  For the convenience of our interviewee and our Spanish speaking audience, this article is in both English and Spanish.]

***

Maestra Tequilera, Ana Maria Romero Mena.
Maestra Tequilera, Ana Maria Romero Mena.

TA:  How would you describe your experiences as a high ranking woman in your position in a primarily male dominated industry?

(¿Cómo describiría sus experiencias como una mujer de alto rango en su posición en una industria dominada principalmente masculina?)

ARM:  [My experiences have been]  dynamic, enriching, and in constant evolution despite the tequila industry having a long history and a bright future.  There’s lots to do in the arena of research and innovation.

(Dinámicas, enriquecedoras y en  constante evolución, a pesar de ser una industria con un largo pasado y un gran futuro; hay mucho que hacer en el campo de la investigación y de la innovación.)

The dynamic experience [has been] because it’s an industry in expansion in that the study of new forms of interpreting tequila by the [olfactory] senses are different due to culture, age and sex [of the individual]; enriching because there’s so much to learn from those men who are behind every bottle, from the [brand] owner to the jimador, have been generous in imparting their experiences [to me]; and in constant evolution because the markets have globalized and they permit the generation of new strategies for the positioning of Tequila.  Finally, I’d like to say that [the industry] is male dominated but not male chauvinistic.

Romero Mena and actor, Patrick Dempsey of Grey's Anatomy.
Romero Mena and actor, Patrick Dempsey of Grey’s Anatomy.

(La experiencia dinámica es porque es una industria en expansión en la que el estudio de nuevas formas de interpretar al tequila desde los sentidos son diferentes debido a la cultura, la edad y el sexo; enriquecedoras porque hay mucho que aprehender de esos hombres que están detrás de cada botella, desde el dueño hasta el jimador, han sido generosos en compartir sus experiencias y en constante evolución porque los mercados se globalizan y nos permiten generar nuevas estrategias para el posicionamiento del Tequila, para finalizar me gustaría decir que es masculina pero no machista.)

TA:  How have you been able to change things within your industry?

(¿Cómo han sido capaces de cambiar las cosas dentro de su industria?)

ARM:  By studying the behavior of the industry in all its arenas, detecting areas of opportunity, completing the research of that opportunity and presenting it for the betterment of the industry as in the case [of the investigation] of the aromas of tequila, where its source was placed in accordance with its behavior in the development of the sensorial profiles of tequila and then delivered to the mind of the consumer by means of the cata (tasting).

Romero Mena in the agave fields.
Romero Mena in the agave fields.

(Estudiando el comportamiento de la industria en todas sus aéreas, detectando aéreas de oportunidad, realizando la investigación de esa oportunidad y presentándola para el mejoramiento de la industria, como lo fue la investigación de los aromas del tequila, su procedencia  para  ubicarlos de acuerdo a su comportamiento en el desarrollo de perfiles sensoriales del tequila y llevarlos a la mente de los consumidores por medio de la cata.)

TA:  What do you see as the future of women working within the Tequila Industry?

(¿Qué ves como el futuro de las mujeres que trabajan en la industria del Tequila?)

ARM:  It is a full future that allows us to not only grow personally and professionally, but to also leave a legacy for the new generations of women in which innovation will be the key [word].

(Es un futuro pleno, que nos permitirá  no solo desarrollarnos personalmente y  profesionalmente, si no dejar un legado para las nuevas generaciones de mujeres en las que la innovación será la palabra clave.)

TA:  What things would you like to see changed?

(¿Qué cosas gustaría cambiado? )

ARM:  To give women more opportunities in positions of higher responsibility and decision making [since] we still share only a minimal portion of those positions.

(Darles mayores oportunidades en puestos de gran responsabilidad y toma de decisiones a las mujeres, todavía compartimos  en un porcentaje mínimo en esos puestos.)

Maestra Tequilera, Ana Maria Romero Mena
Maestra Tequilera, Ana Maria Romero Mena

TA:  Is there anything you’d like to say to women who may be contemplating entering and working in the Tequila Industry in one form or another?

(¿Existe algo que le gustaría decir a las mujeres que pueden estar contemplando entrar y trabajar en la industria del Tequila en una forma u otra?)

ARM:  It’s a fascinating industry [and] one must get to know it in all its facets, visit and study the different distilleries, the Consejo Regulador del Tequila (CRT) and the National Chamber of the Tequila Industry (CNIT); get to know its regulations (normas), certify yourself in the desired area of opportunity, e.g.:  Maestra Tequilera, Maestra Destiladora; to be at the forefront [vanguard] of the advances and news that generates its dynamism and above all, to be passionate about your work.  Knowledge is the key that opens all the doors to opportunities.

(Es una industria fascinante, hay que conocerla en todas sus variables, visitar  y estudiar las diferentes destilerías,  el Consejo Regulador del Tequila y La Cámara Nacional de la Industria Tequilera, conocer su normatividad, certificarse en el área de oportunidad deseada, por ejemplo Maestra Tequilera, Maestra Destiladora, estar a la vanguardia de los avances y noticias que genera su dinamismo y sobre todo apasionarse por su trabajo.  Ya que el conocimiento es la llave que abre todas las oportunidades.)

Follow Ana Maria Romero Mena on Facebook and Twitter @Amrcreativa.

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Salud!!