Puerto Rico’s Bacardi Rum Takes on the World

By: | at 08:00 PM | Channel(s): International Trade  

By Karen E. Thuermer, AJOT
Bacardi Rum has its roots in Cuba after Don Facunda Bacardi Massó emigrated from Spain to Santiago de Cuba. While rum was the most popular drink in the Caribbean thanks to the region’s large sugarcane industry, he realized it needed to be made more palatable for up and coming tastes.
By 1862 he created four different rum formulas, purchased a small distillery in Cuba, and founded the Bacardi Company.
Bacardi’s success did not last long. Cuba’s economy floundered during the 1890s, and the company was thrown into even greater turmoil when Cuba revolted against Spain to gain independence. Don Facundo’s son, Emilio, then head of the company, was jailed and later fled to Puerto Rico.
But some years later, in Puerto Rico, the Bacardi business started growing again. By 1936, the Bacardi Corp. was established in San Juan.
Today Bacardi, which maintains its corporate headquarters in Bermuda, is the largest premium rum brand and the third largest spirit company in the world behind Diageo and Pernod. Next year it will celebrate its 150th anniversary.
World Reach
The company continues to strive to become the world’s premium spirits company. In 1993, Bacardi began expanding its global footprint by acquiring Martini & Rossi, the Italian producer of Martini vermouth. In 1998, it purchased Bewar’s scotch and Bombay Sapphire from Diageo. In 2002, the company bought the Cazadores Blue Agave tequila brand, and in 2004, the French made Grey Goose vodka.
In 2006, Bacardi bought the New Zealand vodka brand 42 Below, and today continues to make substantial investments in the global spirits industry. It is particularly focusing on growing Asia Pacific markets.
In total, Bacardi has 36 dedicated spirits manufacturing sites around the world. The facilities are involved in bottling, distilling, manufacturing, and research and development and are strategically located in a host of countries around the world.
Among them, says Jorge Marcano, Bacardi’s distillery vice president, are five plants in Scotland are malts distilleries. Martini products are manufactured in Italy, and bottled at plants in Germany, Spain, Canada, the United States, Chile, Uruguay, and Brazil. France is home to three plants, including Benedictine and Grey Goose. The company also has a bottling plant in China.
Rum Operations
Specific to its rum business, Bacardi’s operates two primary distilleries: one in Puerto Rico, the other in Mexico, and a small operation in India. Its Puerto Rico site is the biggest rum distillery in the world. Bacardi’s rum distillery, constructed in 1958, sits on 127 acres in Cataño, Puerto Rico.
Joaquin Bacardi, president and CEO of the Cataño-based Bacardi Corp. told this AJOT reporter during a recent visit to the site that the plant supplies 83 percent of Bacardi rum consumed worldwide, 60 percent of which is destined to the U.S. market.
“The other 40 percent goes all over the world, particularly to Europe, Central and South America, and Asia,” says Bacardi.
The distribution accounts for some 17 million cases, or 100 million bottles, of Puerto Rican rum per year.
“For Puerto Rico, this means a tax rebate to the island of $250 million per year,” emphasizes Maggie Matias, Bacardi vice president and managing director. “As a result, Bacardi is responsible for 3 percent of the government’s annual income.”
Its Mexico plant supplies 16 percent of Bacardi’s rum—primarily for the Mexican and Latin American markets. The distillery is three-quarters the size of Bacardi’s operations in Puerto Rico and manufacturers up to 18 million gallons per year.
Bacardi’s operation in Karnataka, India produces 1 percent of Bacardi’s rum for emerging markets in Asia.
Bacardi also has an alliance with Tamil Nadu-based SNJ Distilleries to manufacture its range of bottles for its liquors.
Consolidation Efforts
Like so many industries worldwide, the spirits industry has been subject to much consolidation. Wh

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American Journal of Transportation