Cuba has room for U.S. ag goods, panelists tell Senators

Cuba has room for U.S. ag goods, panelists tell Senators

Despite hurdles to ag trade with Cuba, panelists at a Senate Ag Committee hearing say U.S. could benefit

Cuba is a solid market for U.S. exports, several panelists told Senate Ag Committee representatives Tuesday during a hearing to discuss ag trade with the island country.

Related: Groups, agribusinesses organize to promote ag trade to Cuba

Two panels included representation from USDA , the Department of Commerce and the Department of the Treasury as well as two farmers and an economist. Some panelists provided background on the Cuba trade situation, while the two farmers explained how Cuba trade may benefit their operations.

A worker sorts tomatoes a day after the second round of diplomatic talks between the United States and Cuban officials took place in Washington, DC on February 28, 2015 in Havana, Cuba. The dialogue is an effort to restore full diplomatic relations and move toward opening trade. (Photo by Joe Raedle/Getty Images)

U.S. Sen. Debbie Stabenow, D-Mich., said it's time for a new policy in Cuba, citing trade numbers that estimate about $290 million of U.S. ag goods were exported to Cuba last year.

"Good start, but this is a country only 90 miles from our shore," Stabenow said. "We can do better than that. That type of economic potential deserves a chance to succeed.

"America's farmers and ranchers are uniquely positioned to lead the way," she said.

To move forward with trade, Stabenow noted that there are still significant barriers to consider, but the U.S. has been chipping away at the to-do list.

President Obama recommended last week that Cuba from the "State Sponsors of Terrorism" list, where it had been placed in 1982 due to Cuba's training of rebels in Central America, according to the Council on Foreign Relations think-tank.

The President also met with Cuba President Raul Castro earlier this month, marking the first time in 50 years the leaders of the U.S. and Cuba engaged in talks.

"Our governments will continue to have our differences and the United States will continue to stand firm for universal rights," Obama said after the meeting, stressing that human rights remain an issue. "At the same time, we agreed that we can continue to take steps forward that advance our mutual interests."

Related: After Cuba trip, ag groups convinced embargo should be lifted

Panelists at Tuesday's hearing were in agreement that the U.S. has a chance to capitalize on Cuba's trade potential – the country last year represented a $2 billion export market globally, and with $152.5 billion in ag exports coming from the U.S. alone, there's room for U.S. ag producers to expand.

But the road will be long, explained USDA undersecretary Michael Scuse. "I am confident that U.S. agricultural exporters can capture the market in Cuba, but I don't want to minimize the obstacles," he told the ag committee, citing concerns about limited foreign exchange, foreign competitors who already are trading with Cuba and general market development.

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The regulatory hurdles are there, too, despite the Presidents' meeting earlier this month. Congress still may review the decision to remove Cuba from the terrorism sponsorship list, and formally remove the trade embargo. Reopening of the embassies is also awaited.

According to the Wall Street Journal, when embassies are re-opened, more banks and businesses are likely to pick up on the Cuban market, making transactions less burdensome.

There is some opposition to reinstating trade with Cuba from some legislators, including 2016 presidential hopeful Sen. Marco Rubio, R-Fla. Rubio, a Cuban-American, said his opposition is based on human rights.

"To do business with Cuba would require you to do business with a military dictatorship. And doing business with them is not a two way street," he told a group of state Farm Bureau members in Washington, D.C., in late March.

Another, perhaps unlikely opponent lies in the Florida Farm Bureau, even though the larger American Farm Bureau is in favor of trade with Cuba.

"We don't want to take agricultural markets away from our brethren from the north," National Affairs Coordinator for Florida Farm Bureau, Janell Hendren, told the Miami Herald on Monday, "but you can’t lift the embargo without also increasing imports from Cuba to the U.S."

Hendren told the Herald that Florida farmers were concerned that Cuban farmers' products could have an advantage due to the state support farmers there receive. Imported diseases or pests also are an issue, the Herald reported.

Some pundits speculate that even with positive press from most of the ag industry, significant trade advancements with Cuba are unlikely to come quickly amid political opposition and the frenzy of the 2016 presidential race. That's not good news for Kansas wheat farmer Doug Keesling.

"It doesn't make any sense to me that if someone wants to buy the wheat that I grow that they have to jump through …regulatory hoops," Keesling said during his testimony. "If Cuba is to become a successful export market for U.S. farmers, these regulatory obstacles need to be repealed. But more than that, we need to see trade sanctions in their entirety lifted."

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