CUBA IS ready to ship one million cases of rum to America if Washington eases its 47-year-old embargo, but would hold off exporting its flagship Havana Club brand because of United States trademark battles, one of the island's top rum executives said.

US trade sanctions have cost Cuba's rum industry US$95 million annually in lost sales and additional spending to import production materials, including glass bottles and machinery from Europe instead of from its neighbour to the north, said Juan Gonzalez, vice-president of Cuba Ron SA, the communist state's rum production monopoly.

Cuban rums cannot be sold in the US, but they are available in more than 120 countries, Gonzalez said, noting that the company sold four million cases in 2008. Of that, Havana Club counts for all but about half a million cases.

The global financial crisis should cut into sales this year, but Cuba still hopes to sell five million cases a year by 2013, Gonzalez said. The government does not release figures on revenue.

Eased restrictions

Cuba's domestic rum market is its top customer, followed by Spain, France, Greece, Chile and Russia. Gonzalez said the US accounts for 40 per cent of the global rum market.

US President Barack Obama has eased restrictions on Cuban-Americans who want to travel or send money to Cuba and both countries have taken tentative steps toward improving long-frigid relations - though the White House had said it has no plans to push Congress to lift the embargo.

Use of european contacts

Gonzalez said Cuba has the capacity to produce six million cases of rum a year and could export one million to the US "in no time" in a post-embargo world.

"We know what sells there and we know what we can produce," he said at a news conference at Havana's Museum of Rum.

Gonzalez said Cuba's rum monopoly has not made contact with US liquor distributors to prepare for a possible opening of the American market, but initially would lean on its contacts in Europe that already export to the US.

He said that the first wave of Cuban rum to hit the US likely wouldn't include Havana Club due to a fight in US courts with Bermuda-based rum giant Bacardi Limited, which produces its own Havana Club, made in Puerto Rico and sold in Florida since 2006.

"We understand there could still be some legal problems with Havana Club," Gonzalez said. "What we hope to sell is Cuban rum, and Cuban rum is Cuban rum. We have a lot of brands that aren't Havana Club."

Perhaps, but none of the island's eight other export-quality brands, including Santiago de Cuba, Canay and Varadero, is as prestigious as Havana Club. Most are sold in Cuban hotels, restaurants and bars and are unknown overseas.

Int'l brand

The Cuban govern-ment has produced rum under the Havana Club label since 1960 - the year after Fidel Castro came to power. The brand has been sold internationally since 1993, when the govern-ment partnered with French beverage company Pernod Ricard SA.

The Cuban govern-ment has sued Bacardi for using the name, which Bacardi claims it owns because the original Havana Club was expropriated without com-pensation by Castro from its Cuban producers, the Arechabala family, who went into exile.

Bacardi bought the name and recipe from the Arechabalas in 1997.

Cuba counters that it registered the Havana Club trademark in the US in 1976, after the Arechabalas let their claim on it expire.

So far, US courts have sided with Bacardi, but Cuba has appealed its most recent case to the US District Court of Appeals. Still, Gonzalez said that fight was enough to delay the brand's would-be US exportation.

"The Havana Club brand has not been lost," he said, "but we have to wait for the process to run its course."

- AP