U.S.-CUBA AGRICULTURAL TRADE POISED FOR GROWTH
BY AFBF | January 10, 2017
Opening trade with Cuba presents clear market opportunities for U.S.
agriculture. Experts at a workshop at the 2017 Annual Convention & IDEAg
Trade Show shared with attendees what normalized trade relations with
Cuba could mean for American farmers and ranchers' bottom lines.
Dr. Steven Zahniser, an economist at the Agriculture Department's
Economic Research Service, set the stage by reviewing what trade has
looked like in the past with Cuba, to where we are today, and what the
future might bring. Zahniser said growth in U.S. agricultural trade with
Cuba remains limited, with credit restrictions putting our products at a
disadvantage. Meanwhile other countries have stepped in and filled the
gap, leaving the U.S. with a smaller market share.
"Normalized trade with Cuba could bring an increase of $1 billion per
year in agriculture exports, compared with the estimated $195 million in
sales of agriculture products from the U.S. to Cuba in 2016," said
Zahniser. He and other economists look to U.S. trade with the Dominican
Republic as a model for what to anticipate with Cuba. Although the DR is
part of a larger free trade agreement, Zahniser called this a solid
comparison in both for market size and purchasing power.
Increased tourism in Cuba could also have a positive impact on
agricultural trade as the country is introduced to more products and
food services exported from the U.S. Zahniser said American consumers
can also look forward to specialty exports like Cuban rum and cigars
with improved trade relations.
Marri Carrow, Western Hemisphere regional director for the U.S. Grains
Council, said grain markets across Central America, and in Cuba
specifically, are poised for growth after a couple rough economic years
across the region.
"If we were to capture 100 percent of the Cuban market share for corn,
they would be our 12th largest export market for corn globally," said
Carrow. "It's not a small market—it's not exactly big either—but it's
sizable and right in our backyard."
Carrow said a return to our former market share, pre-embargo, in Cuba
will depend on improved trade relations and removing the current credit
restrictions. "Until we see those changes, we really have our hands tied
when it comes to agricultural trade there."
Source: U.S.-Cuba Agricultural Trade Poised for Growth | KTIC Radio -