Agriculture Trade on the Agenda During Obama Cuba Visit

Lobbyists for the U.S. agriculture industry and major business groups are descending on Havana, hoping to leverage President Obama’s historic trip to Cuba to advance their interests on the island. Obama is in Cuba, the first time a sitting U.S. president has visited the island in 88 years. The trip comes more than a year after Obama’s December 2014 announcement that the United States would reestablish diplomatic relations with Cuba. Without Congressional action to repeal the embargo — which is unlikely to happen during an election year — lobbyists are using the highly publicized trip to promote the economic benefits of restoring commercial ties with Cuba. They were in contact with administration officials for weeks before the trip, handpicking Cuban business owners to attend White House-planned, entrepreneurship events, and connecting local entrepreneurs with U.S. companies looking to forge deals or collaborate on projects.

U.S. Secretary of Agriculture Tom Vilsack is traveling with the President to highlight the potential for U.S./Cuba agricultural trade. “The normalization of trade relations would allow U.S. farmers to use lower transportation costs to edge in on the European Union’s food exports to Cuba,” Vilsack said. “When the embargo is lifted, the United States will be in a very good position to reclaim a portion of the market we’ve lost.”

Vilsack cited soybeans, rice, poultry, and biofuels as new markets U.S. farmers could tap in Cuba, which in turn could sell organic products to its former Cold War foe. The Obama administration is asking Congress for $1.5 million for on-the-ground studies into challenges to agricultural trade in Cuba, from pests to a diplomatic void left by decades of hostile relations. “We have not had people on the ground,” Vilsack said. “We need to develop relationships with the people in Cuba so we know who to do business with and who actually makes the deals.”

Vilsack, who visited Cuba last month, said state agricultural commissioners and secretaries have also been traveling to the island on trade missions. Last year, representatives of the Indiana Farm Bureau, agribusiness firms, and the Indiana Soybean Alliance witnessed a shortage of food on store shelves and rusted-out Russian tractors during a September trip to the island, which was once the ninth-largest importer of U.S. agricultural products.

Bob White, a retail agriculture specialist with the Indiana Farm Bureau, said there are plenty of logistical issues that make trade with Cuba difficult, such as inadequate telecommunications, electricity, and refrigerated storage. But the primary issue, White said, is the inability to facilitate transactions through credit. “Import-export doesn’t work unless you get a credit venue and a bank that will back you,” White stated.