USDA Received Zero MAP/FMD Program Applications For Cuba in 2019 Or 2020; Will Any Group Request For FY2021?

USDA Accepting Applications for FY 2021 Export Programs

“The U.S. Department of Agriculture’s Foreign Agricultural Service is accepting applications from eligible organizations for fiscal year 2021 funding for five export market development programs. FAS recently published the FY 2021 Notices of Funding Opportunity for the Market Access Program, Foreign Market Development Program, Technical Assistance for Specialty Crops Program, Quality Samples Program and Emerging Markets Program. The application deadline for the five programs is June 26, 2020.

Under the Market Access Program, USDA provides competitive, cost-share assistance to U.S. exporters and agricultural, fish, and forest product trade organizations for international marketing and promotion of U.S. commodities and products. More information about the program and the FY 2021 funding opportunity is available at: https://www.fas.usda.gov/programs/market-access-program-map.

Under the Foreign Market Development Program, USDA partners with nonprofit agricultural and forest product trade associations to build longer-term international demand for U.S. commodities. More information about the program and the FY 2021 funding opportunity is available at: https://www.fas.usda.gov/programs/foreign-market-development-program-fmd.”

Analysis From USCTEC

According the USDA, no request was made in Fiscal Years 2019 or 2020 to use the Republic of Cuba provision in H.R. 2, the five-year Agriculture Improvement Act, known as the “Farm Bill” signed into law on 20 December 2018 by The Honorable Donald J. Trump, President of the United States. No requests in the more than 517 days since the Republic of Cuba became eligible for funding.

In 2018, advocates maintained that the Farm Bill provision was critical to “laying the groundwork” for increasing exports of agricultural commodities and food products to the Republic of Cuba. Statements from members of Congress included: “… an important first step to regaining our presence in Cuba.” Yet, there was not one request to the USDA for Fiscal Year 2019.

Most observers reasonably concluded that legislative advocates- within the United States Congress and organizations located in Washington DC and located outside of the beltway would have prominently teed-up at least one high-profile applicant to request funding on 21 December 2018- regardless of whether the USDA was expected to approve including the Republic of Cuba in Fiscal Year 2019 allocations.

The most significant impact of not having any MAP/FMD requests for Fiscal Years 2019 and 2020 to use the Republic of Cuba provision in the Farm Bill is what the lack of interest portended for other legislative efforts in the United States Congress to rescind prohibitions upon the provision of payment terms for agricultural commodity and food product exports from the United States to the Republic of Cuba.

There has yet to be a United States agricultural commodity exporter or United States financial institution who has publicly stated that they would today provide payment terms and/or financing and what those payment terms and financing terms would be for Republic of Cuba government-operated entities. That absence- which has remained consistent since 2000, is a massive legislative hurdle. Lacking pressure, why would the Trump Administration do anything that it does not want to do?

What Is FMD & MAP?

The USDA does not provide any payments to selected applicants in advance of the applicant making disbursements. The USDA provides payment upon receipt of an invoice from the applicant. The invoices are audited by the USDA and a claw back of payments is permitted. Any Republic of Cuba-related invoice is likely to receive additional scrutiny due to an amendment to the Farm Bill submitted by The Honorable Marco Rubio (R- Florida), a member of the United States Senate.

MAP: “Through the Market Access Program (MAP), FAS partners with U.S. agricultural trade associations, cooperatives, state regional trade groups and small businesses to share the costs of overseas marketing and promotional activities that help build commercial export markets for U.S. agricultural products and commodities.”

For Fiscal Year 2020, the USDA allocated US$176,849,915.00 in taxpayer funds to 65 participants under the MAP compared to US$174,600,000.00 to 65 participants in Fiscal Year 2019 and US$173,802,447.00 to 66 participants in Fiscal Year 2018.

“MAP reaches virtually every corner of the globe, helping to build markets for a wide variety U.S. farm and food products. FAS provides cost-share assistance to eligible U.S. organizations for activities such as consumer advertising, public relations, point-of-sale demonstrations, participation in trade fairs and exhibits, market research and technical assistance. When MAP funds are used for generic marketing and promotion, participants must contribute a minimum 10-percent match. For promotion of branded products, a dollar-for-dollar match is required. Each year, FAS announces the MAP application period and criteria in the Federal Register. Applicants apply for MAP through the Unified Export Strategy (UES) process, which allows eligible organizations to request funding from multiple USDA market development programs through a single, strategically coordinated proposal. FAS reviews the proposals and awards funds to applicants that demonstrate the potential for effective performance based on a clear, long-term strategic plan.”

FMD: “The Foreign Market Development (FMD) Program, also known as the Cooperator Program, helps create, expand and maintain long-term export markets for U.S. agricultural products. Under the program, FAS partners with U.S. agricultural producers and processors, who are represented by non-profit commodity or trade associations called “cooperators,” to promote U.S. commodities overseas.”

For Fiscal Year 2020, the USDA allocated US$26,961,898.00 to 22 participants under the FMD compared to US$27,097,191.00 in taxpayer funds to 22 participants in Fiscal Year 2019 and US$26,484,947.00 to 23 participants in Fiscal Year 2018.

“The FMD program focuses on generic promotion of U.S. commodities, rather than consumer-oriented promotion of branded products. Preference is given to organizations that represent an entire industry or are nationwide in membership and scope.

FMD-funded projects generally address long-term opportunities to reduce foreign import constraints or expand export growth opportunities. For example, this might include efforts to: reduce infrastructural or historical market impediments, improve processing capabilities, modify codes and standards, or identify new markets or new uses for the agricultural commodity or product.

Each year, FAS announces the FMD application period and criteria in the Federal Register. Organizations apply for the FMD program through the Unified Export Strategy (UES) process, which allows applicants to request funding from multiple USDA market development programs through a single, strategically coordinated proposal. FAS reviews the proposals and awards funds to applicants that demonstrate the potential for effective performance based on a clear, long-term strategic plan.”  

Value Of MAP/FMD  

For the United States business community, the MAP/FMD amendment to the Farm Bill was significant, but more likely to provide greater financial value to the government of the Republic of Cuba than to United States food product and agricultural commodity exporters using provisions of the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000.  

The likelihood of a value to United States taxpayers, as members of the United States Senate have posited, of US$28.00 returned for every US$1.00 in expenditures of MAP/FMD throughout the world, and now including the Republic of Cuba, will be challenging to measure- but it will be important to measure and the USDA should focus upon the cost-benefit analysis.

LINK To Analyses:

After Resisting For More Than One Year, USDA Confirms No Requests From US Groups For MAP Or FMD For Use In Cuba
https://www.cubatrade.org/blog/2020/2/26/after-resisting-for-more-than-one-year-usda-confirms-no-requests-from-us-groups-for-map-or-fmd-for-use-in-cuba?rq=FMD

USDA Requested To Publish Organizations/Funding Amounts Approved For FY2020 FMD/MAP Funds In Cuba
https://www.cubatrade.org/blog/2019/12/13/6jb1gv4vgdyxybaom3w2nf0f2jxzlq?rq=MAP

Why Is USDA Stonewalling Response To Follow-Up About FMD/MAP Funding For Which It Previously Provided Answers?
https://www.cubatrade.org/blog/2019/10/9/why-is-usda-stonewalling-response-to-follow-up-about-fmdmap-funding-for-which-it-previously-provided-answers?rq=MAP

USDA Has Up To US$201 Million Available For Cuba- Why Doesn't Any Organization Want To Use It?
https://www.cubatrade.org/blog/2019/5/12/2abai1pugt44khnn3wps4pt0f0wvcl?rq=MAP

Farm Bill: No Fiscal Year 2019 MAP/FMD Applications Submitted To USDA Included Cuba
https://www.cubatrade.org/blog/2018/8/12/h68z2i1k5qc3eizw28z10rg3hfthv2?rq=MAP