WASHINGTON, Oct. 14, 2016 - The Obama Administration announced new measures today to roll back restrictions on agricultural trade with Cuba as part of a broader effort to cement ties with the Communist country just 90 miles from the U.S. border.
The regulatory changes, set to take effect Monday, would make it easier to sell farm equipment and pesticides to Cuba and do away with the 180-day waiting period for foreign ships to return to the U.S. after visiting Cuba.
Mark Albertson, director of strategic market development for the Illinois Soybean Growers, said the lifting of the shipping restriction is particularly good news.
The waiting period has been a vexing problem for some U.S. agricultural exporters, said Doug Keesling, state support committee chairman of the U.S. Agriculture Coalition for Cuba. U.S. producers are now banned from using foreign ships to deliver poultry or other products to Cuba if those ships have made recent stops in Cuba.
“Now if it goes from the United States with chicken, it’s got to go to Cuba and then somewhere else in the world for six months before it can come back (to the U.S.),” Keesling said.
The shipping provision is a bonus, said David Salmonsen, a senior director for congressional relations at the American Farm Bureau Federation. However, while it could help U.S. farm exporters, he predicted it won’t be of huge significance until Congress lifts the 10-year-old financing restrictions on U.S. agricultural commodities.
“For food or agricultural commodities, the restrictions that are in the (Trade Sanctions Reform and Export Enhancement Act) still apply,” Salmonsen said. “That’s the main thing.”
When Congress passed the Trade Sanctions Reform and Export Enhancement Act in 2000, it voted to allow the U.S. to export farm goods to Cuba. But the Treasury Department ruled in 2005 that U.S. banks could not finance those sales.
The U.S. agriculture sector is in general agreement that the financing restriction, which requires Cuba to pay for goods with cash up front, is the single biggest obstacle to selling more corn, wheat, rice, poultry, dairy and other commodities to the island nation.
The new measures announced by the White House today remove those financing restrictions on farm equipment, such as tractors, but are expected to have little impact.
Cuba just doesn’t have the money to be making substantial tractor purchases right now, an official in the farm equipment sector told Agri-Pulse.
Salmonsen agreed.
“I don’t think they’re in the position to be buying a lot of equipment yet,” he said.
But any new business that the proposal can generate will be good for the Cuban people, Keesling said. And anything that puts money into their pockets will help them become better customers and trading partners in the future.
“These amendments will create more opportunities for Cuban citizens to access American goods and services, further strengthening the ties between our two countries,” said U.S. Commerce Secretary Penny Pritzker in a statement. “More commercial activity between the U.S. and Cuba benefits our people and our economies.”
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