Removing roadblocks to ag markets

Historic controversy between the U.S. and Cuba has limited the potential for American agriculture to experience optimum economic trade opportunities.

Proposed legislation currently residing in the Senate would remove crucial U.S.-imposed restrictions on trade with Cuba to provide an increased market outlet for significant trade with the island country that is only 100 miles from the Florida keys.

The Travel Reform and Export Enhancement Act (H.R. 4645) would:
  • End impeding trade requirements, such as the requirement that payment processes from Cuba to U.S. farmers must use a third-country bank and abide by its policies
  • End the requirement that transactions be cash only
  • Require that exports meet the same payment requirements as exports to other countries (payment required when the title of the shipment changes hands, not in advance)
  • Permit U.S. citizens to travel to Cuba (allows for ag-sale facilitation)
In his State of the Union Address, President Obama announced his plans to double America’s exports throughout the next five years to strengthen the economy. H.R. 4645’s passage would help the country meet the administration’s goal.

“Cuba used to be one of our big markets,” said Collin Peterson, chairman of the House Agriculture Committee and the bill’s sponsor. “The bill “would help us get those markets back.”

According to a Bloomberg article that cites The U.S. International Trade Commission, the U.S. has the potential to supply two-thirds of Cuba’s agricultural imports if legislation is passed. This number increases its current 30-percent import volume to the country.

The U.S. exported $528.5 million in food and agricultural products to Cuba in 2009, according to the U.S.-Cuba Trade and Economic Council. The U.S. has exported almost $52 million in food and agricultural products so far this year. The U.S. supplied 27 percent of the Republic of Cuba’s food and agricultural product imports in 2008.

The American Soybean Association, the U.S.A. Rice Federation, the National Corn Growers Association and other agricultural groups are referring to the legislation as “renewing normalized trade.”

However, not everyone promotes H.R. 4645. In a letter published at, Roger Noriega, a visiting fellow at the American Enterprise Institute, said:

“So what do agriculture sales and tourism to Cuba have in common, anyway? Not much. But hard-left Castro apologists are offering a quid pro quo to well-meaning farm state legislators, hoping that they will ignore the brutality of the Cuban regime and vote to loosen sanctions in exchange for meager sales to a bankrupt economy. The argument they make is that the 50-year-old embargo is only hurting U.S. farmers.”

AgriMedia Publications offered its stance about the legislation in an editorial posted at the Web sites of its numerous publications, “Restrictions and stipulations have made trade with Cuba very difficult, practically pushing Cuba to look for products elsewhere. If we're not the supplier, there are many who would like to step in, like the European Union, Canada, Brazil or Argentina.”

The bill has significant bi-partisan support (more than 30 co-sponsors) and farm-organization support, which promises to help its transition to the Senate for further deliberation.

Activating direct banking, the elimination of the cash-in-advance rule and unrestricted travel will improve access to this foreign market; creating an opportunity that benefits ag-industry members and the national economy.

*Photo obtained from The Center for International Policy’s Cuba Program

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