"At the base of one of Kumogakure's many mountains rests a quiet little forest, and within that forest, there is a town. It's nothing special at first glance. It has a few houses, a general store. All in all, nothing to write home about... or so you'd think. Truth is, the town of Hanabari is actually a very lively and bustling little town; you just have to dig a little beneath the surface to see. You see, beneath the little town lies a vast network of tunnels and mine shafts, sprawling for several miles into the mountain at which the village resides under. Within these vast tunnels lies a treasure trove of sulfur. And what do the villagers use the sulfur for, you might ask? Well for that, you'd better know the history of Hanabari's foundings.
It all takes place during the Second Great Ninja War. Devastation reigns around the country and supplies dwindle as each battle rages. Our story begins as a caravan hauling livestock and other food supplies breaks down in the middle of a quiet little forest at the base of a towering mountain. It wasn't a simple break down, however. This was an expertly laid trap -- the work of enemy ninja looking to commandeer the supplies. The Kumogakure Shinobi began to set up a minimal defense, but it was barely enough to repel the attacks for a single night. Hope was fading, until one of the ninja noticed the air had a feint, pungent oder, but what could it be? Of course! It was the sulfur in the rocks, and it was all around them.
The ninja began to harvest the sulfur as fast as they could, breaking it down into a fine powder and combining it with charcoal made from the surrounding trees and the manure from their livestock. Within a few hours, the caravan had laid many crude explosive traps. When the enemy ninja came that night, they were wiped out in a series of devastating blasts, ending the raids altogether. That night, the surviving caravan members used their remaining supplies to craft makeshift fireworks and celebrated the occasion, even if they were still left for dead in the middle of the country side.
The next day, a messenger was dispatched to go seek aid and, while it did eventually arrive, it took many months. Where there was once a desperate and broken caravan, the relief crew found a makeshift town. Wagons had been converted into tents and housing, the livestock had been housed in a little farm area, and the ninja had stockpiled months worth of supplies to make explosives of all types. On that day, the caravan was officially declared a settlement. Now, Hanabari is one of Kumogakure's leading explosives supply lines, and every year on the anniversary of the night the caravan fended off the enemy, you can see one of the most brilliant fireworks displays in the entire country. "