(Posted Thu. Sep 15th, 2016)
Cuba represents an important market for American agriculture, and the time has come to ease trade restrictions, witnesses testified Wednesday at a hearing of the House Agriculture Committee. The hearing focused on U.S. agricultural trade with Cuba as a part of the H.R. 3687, the Agricultural Exports Act, which is sponsored by Arkansas congressman Rick Crawford.
Representatives from Bunge North America and CoBank were among the five witnesses testifying at the hearing.
"Between 2013 and 2015, the Dominican Republic imported $1.3 billion worth of agriculture products from the United States," said Matt Gibson, vice president of agribusiness Bunge North America, pointing out that the two Caribbean islands have similar per capita incomes and populations. "During this same time, Cuba, however, imported only $262 million from the U.S. That is over $1 billion to U.S. agriculture left off the table due to the financing restrictions under which we must currently operate."
Karen Lowe, CoBank Senior Vice President and Divison Manager of Agriculture Export Finance, said that every effort should be made to expand export markets.
"We are in an extended period of low prices on most agricultural commodities. This harsh reality makes every market, no matter the size, important to help move the crop and support prices. At the same time, sovereign risk in many emerging markets is increasing due to economic and geographic risk factors, which increases exporters' need for payment risk mitigation as well as the need for financing," said Lowe.
Wednesday's hearing marked another step forward in efforts to lift the U.S. trade embargo against Cuba and normalize relations between the two countries.
The National Corn Growers Association has long called for an end to the Cuban embargo and encourages any efforts to reduce trade barriers and help America build a two-way trade relationship with Cuba. Although Cuba is just 90 miles from the U.S. border, America's corn farmers have seen their market share erode dramatically in the past decade. U.S. corn exports to Cuba have decreased from nearly 800,000 metric tons in 2008 to just 26,000 metric tons in 2015, representing only 2.5 percent market share.
Meanwhile, competitors Argentina and Brazil have taken advantage of their unrestricted trade with Cuba to eat into U.S. market share in other Caribbean countries, such as the Dominican Republic. All told, the embargo is estimated to cost U.S. farmers $234 million annually in lost opportunity.
NCGA is a member of the U.S. Agriculture Coalition for Cuba, a group of more than 30 U.S. agricultural and food organizations committed to building a deeper U.S.-Cuba relationship. NCGA continues to work closely with fellow coalition members to advance a trade relationship with Cuba that benefits both nations.