US Exported $600M in Agricultural Products to Cuba in 2007

Remains Cuba's Top Food Source [despite 50 year trade embargo]

by Will Weissert, Associated Press

http://biz.yahoo.com/, January 22, 2008

The United States remained Cuba's main supplier of food and farm products in 2007, selling the communist-run island more than $600 million in agricultural exports despite its trade embargo, a top official said Monday.

Cuba imported roughly the same amount of agricultural products as it did in 2006, but rising production and transportation costs forced it to spend $30 million more than the $570 million it paid two years ago for the same goods, said Pedro Alvarez, chairman of Cuba's food import company Alimport.

Alvarez's comments came during a joint news conference with California Secretary of Food and Agriculture A.G. Kawamura, who is in Cuba on a trade mission and is hoping America's largest food-producing state can one day sell as much as $180 million in agricultural products to the island. It was the state's first agricultural mission to Cuba.

Washington's nearly 50-year-old trade embargo prevents U.S. tourists from visiting Cuba and prohibits nearly all trade. But a law passed by the U.S. Congress in 2000 allows the Cuban government to buy U.S. food and agricultural products with direct cash payments.

Cuba at first balked at the measure, but reversed course after a hurricane ravaged parts of the island in November 2001. The government has since spent more than $2.7 billion on U.S. farm products and the related shipping and banking expenses that it factors into import totals, Alvarez said.

The U.S. has been the island's top food source since 2003.

U.S. companies in 35 states ship roughly 1,600 types of agricultural products to Cuba, Alvarez said, declining to specify which state is its top supplier, or which product its top import. U.S. wheat, chicken and soy are big sellers, he added.

California produces 400 types of farm products, including wheat, wine and all types of fruits, vegetables and nuts. Kawamura said it exports about a quarter of that produce, but sends less than $1 million in goods a year to Cuba.

"That's a very small amount of money compared to the rest of the states that are doing business here," Kawamura said, noting that a study by his office found $180 million in Californian products that could potentially be exported to the island.

Kawamura was accompanied by owners of some top California agricultural firms, who are negotiating private contracts directly with Cuban authorities. He also planned to meet with government officials and tour state-run farms.

Agricultural secretaries from 19 states have visited Cuba, although Kawamura is the first from California to do so.

"The door's already been opened. There's plenty of business being done here," he said. "Some of us arguably might be late getting here, but we're here."

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