U.S. farm interests see the potential for more than $1 billion a year in sales to Cuba, a market that right now is hamstrung by restrictions that remain despite the thawing of relations between the countries.
In a hearing Tuesday before the Senate Agriculture, Nutrition and Forestry Committee, farmers and Obama administration officials testified to the steps that still need to be taken if U.S. agriculture is to get the most out of the market just 90 miles from the nation’s shores.
“The problem is rules and laws that just make it too expensive to compete in that market,” testified Doug Keesling, a farmer from Chase, Kan.
Among the key problems: a requirement that exporters receive cash before they’re allowed to unload their products in Cuban ports.
The ban on credit sales is just one restriction that remains despite the warming of relations with Cuba, announced by the White House in December. A month later, the administration relaxed some financial restrictions on trade; since then, some members of Congress have pushed for a full repeal of the trade embargo that’s governed most trade with Cuba for decades.
While agriculture products can be sold to Cuba, the market is far from free and open.
As Keesling recounted: “I can put my wheat in an elevator in Kansas, send it by rail down to the Gulf of Mexico and put it on a ship that’s just a couple days away from the Havana Harbor. But my wheat is still going to lose out to wheat that has to be on a boat for a week from Canada or two weeks from France.”
Cuba imports more than $2 billion a year in food and agricultural products, and one expert who testified Tuesday said that with a more open economy, fewer regulations and other changes, U.S. food and agricultural exports to Cuba had the potential to exceed $1.2 billion annually within five years. That’s up from less than $300 million last year, said C. Parr Rosson, an agriculture economist at Texas A&M University.
A big boost in shipments is possible, Agriculture Secretary Tom Vilsack told McClatchy.
“Look it’s only 90 miles offshore,” he said in an interview Tuesday afternoon. “The American farmer is anxious to do business with the Cubans. And I think there are things we grow and raise – pork, poultry, soybeans – that we grow in great abundance and raise in great abundance that the Cubans would be quite interested in having.”
He added: “I don’t think it’s beyond the pale to believe that there is that type of opportunity, so long as we don’t impose on ourselves unnecessary restrictions and create friction in that relationship.”
The U.S. farm lobby is pushing hard for a repeal of the trade embargo, and the hearing was generally friendly to that position, which remains controversial in Congress as a whole. A bill has been introduced to eliminate trade restrictions with Cuba, and it has supporters from both sides of the aisle.
But it faces long odds. At best, according to U.S.-Cuba experts, trade advocates are in for a long battle. Experts said it was unlikely that this Congress would end the embargo, which has the potential to divide the Republican Party.
Short of full repeal, experts said, politicians might find agreement on further relaxing financial regulations, such as the credit ban.
Franco Ordoñez contributed to this story.
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