March 10, 2010

Cuba bill to increase US agriculture one-way trade

Two US grain organisations have supported the legislation which would expand one-way trade and lift current travel restrictions with Cuba.

The National Corn Growers Association (NCGA) and the American Soybean Association (ASA) have announced support of H.R. 4645, the Travel Restriction Reform and Export Enhancement Act, which was introduced by US House of Representatives Agriculture Committee Chairman Collin Peterson.

"This legislation will increase one-way agricultural trade from the US to Cuba," said NCGA First Vice President Bart Schott. "We currently export food to Cuba and these changes will level the playing field for American farmers. It is important to note, though, that it does not eliminate the embargo itself."

"ASA opposes restrictions on exports of US agricultural commodities for national security or foreign policy reasons that are not supported by all other major world producers and exporters," said ASA President Rob Joslin. "ASA favours a normal trading relationship with Cuba including direct banking and elimination of the cash in advance rule. ASA also supports the country's eligibility for the Foreign Market Development and Market Access Programmes."

NCGA said the bill provides an opportunity not only to preserve current US sales of corn to Cuba, but also to increase demand for distillers dried grains and other corn value-added products such as poultry. According to the USDA's Foreign Agricultural Service, Cuba was the 10th largest export market for US corn during the 2008-2009 marketing year.

In 2008, there were more than US$134 million worth of soy products exported to Cuba. ASA noted that if current policies that require third country banks, cash advance payments and limits on travel were lifted, these exports would be expected to increase.

The proposed legislation would eliminate both the need to go through banks in other countries to conduct agricultural trades and the accompanying fees those banks charge.

The bill would also require agricultural exports to Cuba to meet the same payment requirements as exports to other countries, which means payment would be required when the title of the shipment changes hands, not in advance. Finally, the bill would allow US citizens to travel to Cuba, reducing the bureaucratic red tape currently required for individuals to travel to Cuba to facilitate new agriculture sales.