U.S. ag trade to Cuba continues upswing despite turbulent economic conditions
U.S. agricultural exports to Cuba reached $715 million in 2008 despite turbulent global economic conditions, according to a Texas AgriLife Extension economist.
A weaker dollar, lower commodity prices and a series of hurricanes that reduced Cuba's food supply all contributed to the upturn in U.S. exports, said Dr. Parr Rosson, AgriLife Extension economist and director of the Center for North American Studies at Texas A&M University.
Total economic impact of U.S. agricultural export trade with Cuba since 2003 has reached $1.9 billion and led to more than 36,000 jobs.
"It's a market that has grown surprisingly fast given the economic conditions in that country," Rosson said.
Rosson recently gave an economic impact presentation of U.S. agricultural export trade with Cuba at the XI International Conference on Globalization and Development Problems in Havana.
In 2002, more than $140 million in U.S.-produced agricultural products were exported to Cuba. That jumped to $715 million in 2008, factoring in higher tonnage and increased commodity prices, Rosson said. The number of jobs resulting from trade with Cuba has also been on the upswing.
"The ability to require about 14,000 jobs or workers to support that trade is significant," he said. "About 95 percent of the economic gains are in the grains sector since the U.S. exports primarily corn, wheat, processed poultry, soybeans and soybean products."
Job creation has also resulted in the following sectors: Transportation, finance-banking, real estate, health care, food, beverage, banking and fuel and energy, Rosson said. "The impacts are quite widespread since everything with Cuba is all on a cash basis," he said.
The outlook for the future is "very cloudy," according to Rosson.
"There were $67 million in purchases by Cuba during the first quarter of this year," he said. "However, the downside is the worldwide economic situation. The nickel market has crashed so that means less money, with prices falling from $13 per pound last year to under $6 per pound currently. Tourism is big business in Cuba as well, and a projected downturn in the number of people visiting the country is expected to further impact the economy."
Rice purchases have already shifted from the U.S. to Vietnam, Rosson said.
"They sell it cheaper and last year when commodity prices were so high in the U.S., they had to look elsewhere for a cheaper price," he said.
A workshop on exporting to Cuba will be held May 14 in Houston at Brady's Landing, 8505 Cypress St. The workshop is open to export service providers, food processors, distributors, forestry businesses and producers, and its goal is to help them succeed in the Cuban market, Rosson said.
Sponsors are AgriLife Extension, Texas-Cuba Trade Alliance, the Transportation Club of Houston, International Traffic Management Association and the Greater Houston Partnership.
For more details, visit the Texas-Cuba Trade Alliance website at www.tcta.us.
For more information, contact Rosson at 979-845-3070 or e-mail email@example.com.