WHY MCCLELLAND CLOSED

Here, lifted from Tobacconist, (the official publication of the IPCPR since 1990), is an article explaining what happened to McClelland Tobacco Company earlier this year, and why they no longer exist.


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END OF AN ERA: MCCLELLAND TOBACCO CLOSES ITS DOORS

By Larry Wagner
May 1, 2018

Pipe smokers around the world are in mourning after McClelland Tobacco announced in February that it would cease production of its world-class Virginia and Oriental pipe tobacco blends, effectively ending 40 years of creating some of the finest smoking tobaccos ever produced.

McClelland was founded in 1977 by Carl and Mary Ehwa and their partner Bob Benish. At the time, Carl and Bob had been working for Diebel’s, a well-known tobacconist in Kansas City, Missouri. “Carl had developed blends for Diebel, and Fred Diebel had purchased factory equipment,” recalls Mary. “I think that was in 1969. By 1977, Carl wanted to create more blends than Diebel was interested in. So there was a friendly parting, and McClelland began.”

The new brand was initially introduced in 10 blends: five Oriental mixtures and five matured Virginias. The concept was very much in the style of the vaunted Scottish brand Rattray’s, which utilized matured Virginia, as opposed to the bright Virginia typically used in English mixtures. For many American pipe smokers, McClelland picked up the mantle of Scottish-style tobaccos when Rattray’s was purchased and moved to Germany. While following in the footsteps of Rattray’s may not have been the impetus for launching the McClelland brand, Mary recalls, “We thought the blends had changed. The Rattray’s blends were very popular at Diebel’s because Carl and Bob liked them so much. I’m not sure we realized Rattray’s had been moved to Germany at that time.”


The McClelland brand was immediately recognized for its distinctive embossed labeling—brown for Virginias and green for Orientals—as well as for its painstakingly crafted aged tobaccos. McClelland quickly set a new standard for rich, complex tobacco blends, which imparted the unique tang and natural sweetness only matured Virginia can offer. Pipe smokers noticed.
Within a few years, McClelland Tobacco could be found on the shelves of most serious tobacconists nationwide. Mike McNiel, who had also worked for Diebel’s, joined the team in 1980, when Bob left to pursue other options. The three partners worked side by side, perfecting the art of blending and aging fine tobaccos. Then, tragically, in 1982, Carl suffered an aneurysm and did not return to the business. He later passed away at age 50.

Throughout that difficult period, the company continued to grow at a gradual, methodical pace. Eventually, Mary and longtime colleague Mike were married, creating a personal and professional partnership that was able to move forward the vision of the boutique manufacturer and to expand on the initial offerings. Owing to their devotion to quality and quest for perfection, the company was in no hurry to bring new blends to the market. As Mary stated emphatically, “It has to be excellent.” They began to produce a full line of bulk tobaccos, initially Virginias and Oriental mixtures, then adding premium-grade aromatics, allowing tobacconists to offer McClelland-quality private-label tobaccos to their customers.

In time, as the right tobaccos were presented to them, the McNiels introduced a new series. In 1992, McClelland brought out its first new tinned blends: Dominican Glory, a matured Virginia incorporating aged cigar leaf, and Christmas Cheer, a perennial favorite that changed each season. The early 1990s also saw private-label tinning, initially for Nat Sherman and Barry Levin. Levin Pipes closed after Levin’s passing in 1994, and a year later McClelland released the Personal Reserve series, making widely available the blends that had been created exclusively for Levin Pipes International.


“My husband Mike is the heart of McClelland. And he goes to such extreme lengths to make sure that everything is just right. And we’re a small company. There’s no way a larger company would go to the same lengths to do this, to produce this type of product. They wouldn’t have our level of obsession.”


McClelland then launched an ambitious project to produce innovative proprietary blends with its Craftsbury series. Most notable among them was Frog Morton, a moist, soft-smoking Latakia mixture that managed to combine its subtle smokiness with an alluring fragrant quality. Frog Morton became the go-to mixture for introducing smokers of aromatic tobacco to the more sophisticated Latakia mixtures. Later releases would include Blakeney’s Best, Grand Orientals, Syrian Latakia blends, Master Penman and others too numerous to list here. In all, by the end of its tenure, McClelland’s tobacco blends included more than 240 varieties.

With such a long history of excellence and universal acclaim, one might wonder what could have persuaded the McNiels to discontinue the brand and cease production.

“In our view, it’s kind of a perfect storm, what happened in the tobacco business,” says Mary. “The FDA [U.S. Food and Drug Administration] is always in the background. Even now, the effects of the FDA are considerable. They don’t want you to make any new products. If you do make a new product, it has to go through the premarket authorization, which I do not believe anyone has passed. And it’s considerably expensive. We’re told the cost is $2,000 to $2,300 per test. If you’re a small company with 240 products, say at $2,000 per test for each, that’s $480,000 a year. That’s a lot of money! They also said they don’t want anymore seasonal or limited-edition products [because] it encourages people to smoke, and they don’t like that. And there’s the great unknown of how are they going to test pipe tobacco? They only know how to test cigarettes. They want the industry to develop the tests, and then they want us to pay for the tests they’re going to use to put us out of business!”

Simultaneous with the FDA’s regulatory oversight came the government’s decision to no longer support the cultivation of tobacco as an agricultural product.

“For 40 years we had the benefit of government and the support of the Department of Agriculture [USDA],” says Mary. “They ran the auctions. They established the grading system. They supported us just like any other agricultural product. We had what they called ‘the government pool.’

“Let’s say the season was a bad one and crops weren’t bringing the best price because the quality wasn’t high. The government would buy up what wasn’t being sold, and that money was put into the government pool. And that gave the farmers enough money so they could plant again. The land that produced tobacco was considered an asset. The government would take care of the farmers with regard to whether or not they could plant. About 12 years ago, the government voted to buy them out [and] buy up those assets so that they wouldn’t have to be supportive of tobacco anymore. They had what they called ‘the farmer buyout,’ and the industry had to pay for it. For 10 years we paid the USDA so that the farmers would be paid off. As a result, about 68 percent of the farmers retired about 2016, and that ended about the same time the FDA came in and wanted to charge us user fees. After the farmer buyout, the USDA said, ‘That’s it for us. We’re not running auctions anymore. We’re not involved with tobacco anymore.’”

The McNiels have always been adamant in their insistence of using only the finest-quality leaf for their blends. Their agents who represented them at tobacco auctions were instructed only to bid on the very best lots of tobacco available. As Mary tells it, the government’s exit from subsidizing and partnering in the cultivation of tobacco, in addition to its obvious agenda to discourage smoking, led to such a reduction of quality leaf tobacco they simply could no longer produce the level of product they would put their name on.

“[My leaf buyers said that] the way things are handled today, the way it’s processed today is 180 degrees from what McClelland needs,” she says. “The leaf we’ve always depended on has to be picked when it’s ripe. The whole process was very labor-intensive. They used to go through the fields to pick leaves five different times, progressively going up the plant. Now what they’re doing is mechanical harvesting, and that pulls the green along with the ripe. Then when that leaf is put through the flue-curing process, which is intended to seal in the sugars; that unripe leaf has no sugar to seal in!”

A manufacturer like McClelland, which uses only high-grade leaf, simply cannot produce the same level of quality tobaccos from the caliber of Virginia tobacco now available to them. “We can still get Perique, we can still get Latakia, we can still get burley. But we never based our business on burley, so when you add up all the products that we have had, if you take away all the ones that require matured Virginia, it’s down to so few that we can’t make a living from it.”

So why not sell the McClelland brand to an existing tobacco manufacturer? The response: “We’re a company that is obsessed,” says Mary. “My husband Mike is the heart of McClelland. And he goes to such extreme lengths to make sure that everything is just right. And we’re a small company. There’s no way a larger company would go to the same lengths to do this, to produce this type of product. They wouldn’t have our level of obsession.”

With the potential for remaining in the industry remote, Mary reflected on the couple’s tenure in this amiable business, as well as her feelings about leaving it. “You know, it’s kind of bittersweet,” she says. “The parts that have been difficult to deal with, the negative things, we’re happy to leave those. But having the pr">oducts that we’ve had, it’s been great fun. It’s been a joy developing new products and having people like them as much as we like them.”


The McNiels’ commitment to excellence and their determination to create and produce only the finest of products was perfectly summed up in a 2000 interview with Tobacconist’s sister publication Pipes and tobaccos, in which Mike gave this eerily prescient quote: “If the quality of available leaf ever went down to the point where we didn’t like our own product, we would shut the doors. We would shut the doors immediately and end it all because our name is on that can, and I’d rather find something else to do than put out something that isn’t right. I would rather go out of business. That way we could say, ‘Well, at least we went out with a great name.’ So McClelland will always be high-quality. We’ll never change.”

With the closure of McClelland Tobacco, the industry has lost not only one of its great manufacturers but also people of the highest caliber, the type of people who make the tobacco business such a wonderful community. We wish them the best.

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SOURCE: http://www.tobacconistmagazine.com/end-of-an-era-mcclelland-tobacco-closes-its-doors/
This article placed here for reference purposes, in case Tobacconist magazine ever shuts down.

The International Premium Cigar & Pipe Retailers Association is the oldest, largest and most active trade association representing and assisting retail tobacconists. IPCPR members include retail stores throughout the world selling tobacco products and accessories (premium cigars, tobacco pipes, loose tobacco, cigar and pipe accessories and gift items) as well as manufacturers, distributors and service providers of high quality merchandise.


Please enjoy your smokes.