CubaNews / April 2003
By Larry Luxner
Imitation crab meat from China, octopus from Vietnam and smoked salmon from California could soon end up on restaurant tables across Havana — thanks to the first seafood shipment from a U.S. company to Cuba since the 1959 revolution.
City Seafoods, based in Los Angeles, has snared a $180,000 contract to supply 35,000 pounds of frozen delicacies to Cuban food import agency Alimport.
“It’s the first-ever fish export from the U.S. to Cuba, and it opens a tremendous new market for American companies,” said Greg Estevani, president of Global Strategies Trading LLC, which brokered the deal.
“We are in pre-contract negotiations with quite a few California companies that could also be on a first-ever status,” Estevani said, noting that City Seafoods is one of 50 companies on his client list. “We’re taking a creative approach in an attempt to set up a gateway for California trade. Our very focused objective is to drive as many California companies as possible through our gateway.”
The first container of frozen seafood under the contract was handled by Crowley Liner Services out of Jacksonville, Fla., with similar shipments to follow in coming months. Joe Heidelmaier, vice-president of City Seafoods, said the deal followed a month of negotiations during and immediately after the U.S. Food and Agribusiness Exhibition held last September in Havana.
“At that time, we were overwhelmed with Cubans from every side of the seafood industry. I stayed three or four days after the show ended, hoping we could put something together,” Heidelmaier told CubaNews.
“They made a list of all the seafood items they thought Cuba would use in one year — down to the kilogram — then they broke it into a spreadsheet and asked us to provide pricing on everything from salmon to caviar. It took two and a half days, and 30 people with laptops. I’ve never seen anything like it.”
It may seem puzzling why Cuba needs a U.S. company to supply octopus from Vietnam or crab meat from China — two nations that maintain strong political and commercial ties with the Castro government. But Heidelmaier explained the logic behind the deal.
“Obviously Cuba has access to seafood from around the world. They do a tremendous amount of business with Chile, for example. But these other countries know that Cuba pays its bills very late; that’s why they make the Cubans pay through the nose for their products,” he said.
Because U.S. law allows food exports to Cuba on a cash-only basis, Heidelmaier, unlike his Canadian or Chilean counterparts, doesn’t have to worry about getting paid; he gets his money up front.
“That’s why I can sell them on reasonable pricing and quantities that are much lower than they’d otherwise have to take,” he said. “For example, I can sell them very small quantities, like 3,000 lbs. of imitation crab meat, rather than one large container.”
City Seafood’s products are destined for the Hotel Nacional and other luxury resorts catering to tourists.
Heidelmaier conceded that “we had some bugs to work out” to make seafood exports to Cuba a reality, but added that since then, business with Alimport has been “absolutely profitable,” with profit margins of 10-20%.
Another company, Beaver Street Fisheries of Jacksonville, signed an $85,000 contract last November to supply Alimport with 25 different frozen seafood items, though none of the items have been shipped yet.
Karl Frisch, vice-president of Beaver Street Fisheries, said that besides seafood, his company has agreed to supply Alimport with chicken quarters, soft drinks, spices and other third-party items.
“We’re working on other items,” he told us, “but I don’t want to tip off my competition.”