Ag Delegations Traveling To Cuba Need To Know What Is Possible And Advocate To Government Of Cuba To Permit All That Is Permissible- Waiting For Direct Export Of Coffee, Cacao, Honey. Complaining Is Not Constructive.
Important for individuals subject to United States jurisdiction to be knowledgeable in advance of traveling to the Republic of Cuba of statutes, regulations, and policies relating to exporting products and services to the Republic of Cuba, importing products and services from the Republic of Cuba, and providing direct investments within the Republic of Cuba. Critically important is to have knowledge about what has been accomplished and what has not been accomplished. These are the responsibilities of the visitor and the organizer of the visit, if there is one.
Providing Republic of Cuba nationals who are officials, managers, owners, and workers with inaccurate information- and permitting officials, managers, owners, and workers to promote inaccurate information does nothing to advance the interests of United States-based companies and organizations.
Critical for United States-based interests and Republic of Cuba-based interests to use what does exist with respect to export opportunities and import opportunities rather than misuse valuable time and unnecessarily high-priced face-to-face engagement for the purpose of complaining about what does not exist and what could be if what existed did not exist. There are opportunities- important to use them.
Republic of Cuba government-operated Cubaexport continues to prohibit the direct export of coffee, cacao, and honey to the United States. The direct export of charcoal was authorized by Cubaexport which operates under the Ministry of Foreign Trade and Foreign Investment of the Republic of Cuba. The indirect export of coffee (processed) was authorized by Cubaexport.
According to the United States Department of Agriculture (USDA), no request was made immediately or soon after the Republic of Cuba provision in H.R. 2, the five-year Agriculture Improvement Act, known as the “Farm Bill” was signed into law on 20 December 2018 by The Honorable Donald J. Trump, President of the United States.
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.” 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.
According to Denver, Colorado-based Potatoes USA, the organization applied to the USDA for the use of MAP (Market Access Program) funding in May 2019. The amount of the request was US$60,000.00. In November 2020, 33,118 pounds (15,022 kilos or 21.04 metric tons) of potato seeds valued at US$44,760.00 were shipped to the Republic of Cuba in a container by ocean freight.
Constructing a foundation upon realities is far more effective than constructing a foundation upon a statutory, regulatory, and policy landscape that does not exist and likely will not exist for longer than many desire.
There are neither limitations as to type, quantity, nor to quality, of agricultural commodities and food products which may be exported from the United States to the Republic of Cuba within provisions of the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000. The TSREEA re-authorized the direct commercial (on a cash basis) export of food products (including branded food products found in a supermarket) and agricultural commodities (including fertilizers and telephone poles and paper) from the United States to the Republic of Cuba, irrespective of purpose. Since the first deliveries using the TSREEA in December 2001, the total value of agricultural commodities and food products delivered from the United States to the Republic of Cuba exceeds US$6.6 billion.
Useful to mention that those United States-based exporters of agricultural commodities and food products to the Republic of Cuba have not publicly advocated for a change in payment terms from cash-in-advance as required by the TSREEA to permitting payment terms and permitting financing.
In 1999 and 2000, United States-based exporters of agricultural commodities and food products advocated against including payment terms and financing in the TSREEA for fear that the Republic of Cuba was likely to default, and any reported default would expectantly result in widespread reluctance for any commercial engagement with the Republic of Cuba. The theory was better to have less volume and United States dollar value in overall exports when confined to cash-in-advance payments than insert considerable risk where none would exist.
Instructive that no representative of a United States-based financial institution has confirmed in public, including at committee hearings and sub-committee hearings before members of the United States Congress (House of Representatives and Senate), that they would provide financing to a Republic of Cuba government-operated entity.
The existing commercial, economic, and political relationship between the United States and the Republic of Cuba remains absent normality due to statutes, regulations, and policies initiated, implemented, and adhered to by the governments in both capitals.
Each government has implemented harm upon the other government- and United States-based companies and Republic of Cuba-based companies, particularly the self-employed and newly-re-authorized micro, small, and medium-size enterprises (MSMEs) are unable to fully engage to levels where each are comfortable- and account for inspiration and aspiration, the fuel which propel entrepreneurs.
The Republic of Cuba may purchase inputs including equipment. In 2017, Deere & Company (2021 revenues approximately US$44 billion) established a distribution center in the Republic of Cuba, joining San Juan, Puerto Rico-based RIMCO, the Republic of Cuba distributor for Peoria, Illinois-based Caterpillar Inc. (2021 revenues approximately US$42 billion) established the same year. At the time, neither Deere & Company nor Caterpillar issued media releases or posted information on their respective Internet sites.
Since November 2017, Deere & Company delivered more than US$800,000.00 in agricultural equipment to the Republic of Cuba for use at its distribution center. Antioch, Tennessee-based Wirtgen America, Inc., a subsidiary of Windhagen, Germany-based Wirtgen Group (2021 revenues approximately US$3 billion), a construction equipment machinery subsidiary (acquired in 2017) of Deere & Company has also delivered products to the Republic of Cuba. RIMCO continues to deliver equipment for use at its distribution center in the Republic of Cuba, including excavators, backhoes, graders, scrapers, bulldozers, railway fixtures, and signaling equipment, valued at more than US$4 million since December 2018. John Deere Financial Services was to provide payment terms/financing for the exports, primarily Series 5000 (price range US$25,000.00 to US$80,000.00) with a limited quantity of Series 7000 (price range US$219,000.00 to US$280,000.00). According to the company, several hundred tractors, parts and accessories may be exported from the United States to the Republic of Cuba during the next four years, with the first deliveries (for testing and evaluation) scheduled for mid-November 2017. The potential value of the several hundred products exported from the United States to the Republic of Cuba that would be financed could range from US$9 million to US$30 million. John Deere Financial Services has not commented as to whether the product sales goals have been achieved or if there have been issues relating to the receipt of payments. Caterpillar has not disclosed if the company has provided payment terms for its products exported to the Republic of Cuba.
United States Department of State
Washington DC
Section 515.582 List
Bureau of Economic and Business Affairs Goods and Services Eligible for Importation
“In accordance with the policy changes announced by the President on December 17, 2014, to further engage and empower the Cuban people, Section 515.582 of the Cuban Assets Control Regulations (31 CFR Part 515 – the CACR) authorizes the importation into the United States of certain goods and services produced by independent Cuban entrepreneurs as determined by the State Department as set forth on the Section 515.582. The goods whose import is authorized by Section 515.582 are goods produced by independent Cuban entrepreneurs, as demonstrated by documentary evidence, that are imported into the United States, except for goods specified in the following sections/chapters of the Harmonized Tariff Schedule of the United States (HTS).”
Coffee from the Republic of Cuba is available throughout the United States through an agreement signed in 2016 between New York, New York-based Nespresso USA Inc., a subsidiary of Lausanne, Switzerland-based Nestle Nespresso S.A. (2021 revenue approximately US$95 billion); Arlington, Virginia-based TechnoServe; and Republic of Cuba government-operated Cubaexport, under the auspice of the Ministry of Foreign Trade of the Republic of Cuba.
From Nespresso: “The green coffee sourced for Cafecito de Cuba is 100% pure Arabica, grown by smallholder farmers in the provinces of Granma and Santiago de Cuba in the eastern part of Cuba. Nespresso coffee experts in Switzerland then used a split roasting technique to enhance the potential of the beans and highlight their authenticity. One part of the beans was roasted for a shorter time to a lighter colour to bring out the coffee’s unique flavours and aromas. The second part was roasted longer to a much darker colour to create a strong body with a dense, velvety texture and intense rich flavours.” Link: https://nestle-nespresso.com/news/Nespresso-brings-Cuban-coffee-back-to-US
United States-based companies have approached Cubaexport to seek authorization to import coffee directly from the Republic of Cuba to the United States. Those entreaties were rejected.
Charcoal from the Republic of Cuba has been imported directly to the United States. The first company, Hialeah, Florida-based Fogo Premium Lump Charcoal purchased four (4) 20ft containers with the first delivered in January 2017 and the second in July 2018. The second company Foley, Alabama-based GulfWise Commerce LLC, affiliated with Foley, Alabama-based Woerner Companies reported delivery in May 2019 to Port Everglades, Florida, of two (2) forty-foot containers. Neither company reported no transactional issues with the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury, Bureau of Industry and Security (BIS) of the United States Department of Commerce, or Office of Legal Adviser (OLA) at the United States Department of State.
Links To Related Analyses
Coffee & Charcoal Have Been Imported From Cuba; U.S. Companies Want More. Agricultural Commodities/Food Products/Healthcare Products Have Been Exported To Cuba; U.S. Companies Want More. October 02, 2021
J.C. Newman Cigar Co. Wants To Add Tobacco Leaves To Coffee & Charcoal As Authorized Imports From Cuba. June 03, 2021
Farm Bill- FMD/MAP Funding
According the United States Department of Agriculture (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.
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.”
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.”
A most significant impact of not having any immediate MAP/FMD requests for 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.
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 TSREEA. 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: USDA Updates Usage In Cuba Of MAP And FMD Funding Authorized By 2018 Farm Bill. In Four Funding Periods In Four Years, Two Uses Of MAP; No Uses Of FMD. Anemic Response By Export Advocates. November 11, 2021
Prensa Latina News Agency
Havana, Republic of Cuba
7 April 2022
US farmers ask to end trade restrictions on Cuba (+Photos). The USA-Cuba Agricultural Coalition seeks to change policies hindering bilateral trade relations, Doug Keesling, one of founders, said on Thursday. It would bring benefits to both sides, Mr. Keesling added at a meeting with the press. While the United States exports over 50% of food it produces, Cubans could sell organic products, vegetables and fruit to the West Coast and generate income to buy supplies, he explained. American producers are willing to be the most reliable source to sell food in Cuba, but also to provide Cuban farmers with technology and knowledge, he added. “We will go back to Washington and fight for this change to happen,” he said. Meanwhile, Tom Haag, vice president of the American Corn Grower Association, acknowledged the effects of the economic US blockade against Cuba. Concerning the significance the Conference, Asiha Grigsby, director of International Promotion of the American Rice Association, stressed that talks “allow us to bring experiences home, speak in our associations and to create a base for better future.” Discussions focused on barriers to doing business and chances of them being removed in the coming years, said Dalton Henry, vice president of the American Wheat Association. Despite challenges, there is already a substantial trade between the two countries as a result of our associations´ work, especially in the poultry sector; we hope to increase as other US organizations urge for friendlier relations, Mr. Henry detailed. For two days, Cuban and US farmers worked to strengthen joint production, bilateral trade and foreign investment. The event, held at the Valentín Quinta Avenida Hotel, included technical round tables between Cuban and US businessmen, visits to Artemisa and Mayabeque provinces, as well as openings by the Chamber of Commerce and the Cuban Ministries of Foreign Trade and Agriculture.
Granma
Havana, Republic of Cuba
7 April 2022
In the exchange between Díaz-Canel and US farmers, Paul Johnson, president of the US-Cuba Agricultural Coalition, which since 2015 has developed an intense agenda in favor of bilateral relations in the sector, emphasized that the links between the two countries are very strong. We have historical ties in the cultural, logistical, family and agricultural. They are ties that unite us as countries and that has to be the basis for improving relations in the future, and not only to export our merchandise here, but also to work with Cuban producers and help them increase their production, and export merchandise. there. Things will not be easy in the future, but –he said– we share objectives that should allow us to move in that direction. We want to contribute – Johnson added – to the development of the great talent that exists in Cuba, and we have come to help improve our relations and also to put an end to this embargo, so we have a lot of work to do. The blockade/embargo – he added – has been present for more than 60 years and has not worked, and it is time to find new strategies to solve the problems and our presence is to help with that.
Ray D'Alessio, a reporter for the Georgia Farm Monitor, asked the Head of State about the concept they have, about what Cubans think of American farmers, to which Díaz-Canel replied that Cuban farmers, both state and private, have a very high rating from their North American colleagues, for their technological and productive development, for the quality of their products, for the good practices they apply. In fact, he told them, there are many of our farmers who communicate with you online to talk and learn about everything related to agricultural production. Our farmers -he summarized- have a high appreciation of you, they aspire to have your development, they see you as a reference. For us, the president pointed out, the natural market, the one that could favor us the most in the food sector, is the United States. We're only 90 miles away. Of you we favor the cost, the quality, the freight, the replenishment, the rapid response in an emergency. But that is an opportunity that neither of the two parties is taking full advantage of, due to the blockade. Robert M. Tobiassen, President of the US National Association of Spirits Importers. UU., expressed that the sector he represents, by its nature, has a different vision than that of the farmers. This is my first visit to Cuba and "I have been impressed by the hospitality of the Cubans, and I thank you and your people," he told Díaz-Canel. Tobiassen pointed out that the quality of its spirits is a heritage shared by Cuba and the United States, and in everything, culture counts, he stated. Alcoholic beverages have their unique history, he added, pondering the importance that different sectors of both countries strengthen their branch relations and build coalitions, as the best way to advance bilateral relations.
Among other interventions, James Summer, president of the United States Chicken and Egg Producers Export Council, explained that he has been coming to the island for 21 years, and recalled the strong ties they maintain here, to the point that Cuba is the third export market for chicken meat producers in his country, after Mexico and China. Today -he added- we held a meeting with representatives of the poultry sector, and we extended our hand to help increase chicken and egg production in Cuba, a sector that is becoming very difficult to maintain, not only here, but also in my country. country, due to shortages, rising costs, problems with the workforce, new diseases, are concerns that we share, as well as the search for successful solutions for our productions, he pointed out, to which the President expressed his willingness of Cuba to cooperate in all that is possible to provide answers to these mutual challenges. The meeting concluded with the words of the farmer from Kansas, Douglas Kessling, a wheat producer, who presented the President of the Republic with a symbolic box with the grain he harvests. "Like Cubans," Kessling pointed out, "US farmers are also very proud and we want to work with Cuban farmers, and strive to have a trade in both directions.”
