No flood of orders for US food yet from Cuba

Washington

BEFORE the US embargo, Cuba bought more American rice than any other country in the world. Now, most Cuban rice comes from Vietnam. Last year, Cuba imported US$200 million worth of wheat - virtually all of it from Europe and Canada and none from the United States, the largest global exporter.

Many US agricultural producers thought those facts would begin to change this year, as US relations with Cuba improved.

But in the six months since President Barack Obama announced a new opening to the island, sales of US foodstuffs - among the few US products allowed, with restrictions, under the embargo - have dropped by half, from US$160 million in the first quarter of 2014, to US$83 million this year.

Even frozen chicken, which has led US food exports to Cuba for years, had lost favour in Havana long before fears of the US bird flu epidemic led this month to a ban on all poultry purchases.

As the administration wraps up negotiations with Cuba that are expected to lead to restored diplomatic ties this summer, only Congress can lift the embargo that still prevents nearly all financial and trade relations and severely limits even the few permitted exports.

Mr Obama has said he wants that to happen, and US producers from major agribusiness companies to small farmers have joined a bipartisan force of farm state governors and lawmakers to help overturn restrictions they say are keeping them out of a US$2 billion annual market.

"Opening a new export market means a new source of revenue," said Devry Boughner, vice-president at Cargill Inc, the Minnesota-based agribusiness giant and a co-founder in January of the US Agriculture Coalition for Cuba.

While Cuba's 11 million people are not the world's biggest market, Ms Boughner said in an interview "it's a market that's right in our target zone". With Cuba only 145 kilometres away, she said, it makes little sense "to be losing out to competitors who take longer to ship it there, who might not even have the same quality" as US products.

Cubans rival South-east Asians as prodigious consumers of rice. Within two years, Riceland Foods vice-president Terry Harris told the Senate Agriculture Committee in April, American rice could be providing up to 135,000 tonnes, 30 per cent of the Cuban market. Within a decade, he said, that figure could rise to 75 per cent or more.

Yet despite a series of hearings, conferences, concerted lobbying and a stream of trade delegations to Cuba from both Republican and Democratic states this year, the embargo remains firmly in place, with little promise of early action.

Malnutrition rates in Cuba are "very low", according to the World Food Program, on a par with the United States and the rest of the highly developed world. Staples are guaranteed via government-issued ration cards. But domestic agricultural production rates are abysmal, equipment and farming methods are antiquated, and up to 80 per cent of Cuban food is imported.

Despite permitting cash-only transactions, US food sales rose to a 2008 peak of US$710 million before starting a downward trajectory that appears this year to have gone off a cliff. WP