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Cuba seen as future competitor, or ally, in agribusiness
The Miami Herald / April 27, 1998

By Larry Luxner

WASHINGTON -- From shrimp to shellfish, limes to lobsters, Cuban non-surgar agricultural exports are popping up in more and more supermarkets around the world -- leading Florida farmers to ponder what long-term impact this may have on their business.

Last year, for instance, Cuban seafood exports came to $180 million, up from $102 million in 1994, according to Anicia E. Garcia Alvarez of the University of Havana.

"Our fundamental goal is to increase exports and foreign-exchange earnings while diversifying," she told The Herald. "Until now, our exports have been concentrated in lobsters and shrimp. But we're trying to increase the proportion of live and whole products, mainly to France, Italy and Japan."

Garcia was one of a dozen speakers at a recent conference at Washington's Cosmos Club. Nearly 100 attendees listened as experts from the University of Havana and the University of Florida in Gainesville assessed the future of Cuban agribusiness.

A chief focus of the day-long conference was citrus -- an industry crucial to Florida but also one that represents strong export earning potential for Cuba. In 1997, the Caribbean island produced 808,000 metric tons of oranges, grapefruit, limes and tangerines -- the largest crop since 1991. It currently ranks third in total grapefruit production behind the United States and Israel.

Cuba is also home to the world's largest orange grove under one management, a sprawling plantation in Jaguey Grande, about a two-hour drive east of Havana in Matanzas province. That operation, run by Israel's BM Group, exports Cuban fruit mainly to the Netherlands for distribution throughout Europe, providing Cuba with badly needed foreign exchange. Because of the U.S. trade embargo against Cuba, BM's officials have been banned from entering the United States.

Yet an eventual lifting of the embargo could help Florida as well as Cuba.

"Florida, because of its geographic location, could become a supplier of inputs required by the citrus and broader agricultural sector in Cuba, as well as a source of new technology," writes Tom Spreen of UF's Institute for Food and Agricultural Sciences.

"Cuban grapefruit, because of its latitude, matures earlier, and represents a real market if and when the embargo is lifted. Clearly, Cuba has an opportunity to be a very strong player," he adds. "Because of land constraints in Dade County, Florida will not reach the production levels of limes it had before Hurricane Andrew. One could easily see an opportunity for alliances between importers and growers of limes in Cuba."

That's also the case when it comes to tropical fruits and vegetables such as mangoes, tomatoes, plantains, melons, cucumbers, peppers, garlic and carrots.

"Given Cuba's location relative to the east coast of the U.S., and its climate, it is reasonable to postulate that Cuba could regain its prominence as a major fresh vegetable supply region to the U.S. market," says Spreen. "Some have even speculated that Florida-based growers and shippers may form an alliance with Cuba to compete with the California-Mexico alliance which currently threatens their survival."

In the case of seafood, Cuba's once-proud fishing fleet -- made possible by cheap, subsidized Soviet fuel -- took a sudden downturn in the late 1970s, when "virtually all coastal nations in the Americas imposed 200-mile limits for their territorial waters in the late 1970s," said UF professor Charles M. Adams. "With few exceptions, the exclusive rights claimed by these coastal nations excluded access by all other countries to the fisheries resources found in their territorial seas."

Things got even worse after the breakup of the Soviet Union, with Cuban landings of all forms of finfish and shellfish falling from 232,000 tons in 1988 to 87,700 tons in 1994. Since then, however, landings have risen slightly to 94,200 tons in 1995 -- the latest year for which statistics are available.

Nearly all of the 19.7 million pounds of spiny lobster Cuba produces annually is exported -- mostly in the form of cooked whole lobster, with lesser quantities of raw, whole lobster and frozen tails. In terms of total value, the major markets for Cuban spiny lobster are Japan (28%), France (24%), Spain (19%), Italy (15%) and Canada (10%). In addition, says Adams, the United States consumes small quantities of Cuban seafood products imported via third countries such as Canada, Panama and Nicaragua.

If and when Washington decides to lift the embargo against Cuba, the island nation could enjoy a sudden increase in exports of spiny lobster, pink shrimp and other species to the U.S. market -- providing its prices are competitive with Nicaragua, Honduras and other traditional seafood exporters.

"The U.S. shrimp market is dominated by imports, particularly farm-raised shrimp. Additional supplies of pink shrimp would be easily accepted, particularly during those per-iods when Florida pink shrimp landings are low," says Adams. "Cuban snapper would likely be very competitive with product arriving from more distant sources within the Central American and Caribbean region. The Florida market for reef fish is very strong and would probably absorb any additional sources of product. And if the Cuban product is priced competitively, other foreign sources may be displaced in the short run."

Says Dan Davis, senior vice-president of sales and marketing at Singleton Seafoods in Tampa: "I don't think it would hurt us. Cuba's quality is good, and there's always a market for quality shrimp."

Adds Bond Pace, owner of Pace Marketing Inc. in Port St. Lucie: "If the embargo were finally lifted, it would open up a completely new range of imports. I think we'd see a lot of the major restaurant chains and processors go flying right over to Cuba and offer to buy all their production."

But nobody's rushing to buy plane tickets just yet. Thanks to the 1996 Helms-Burton Act , it would now take an act of Congress before President Clinton or anyone else could abolish trade sanctions against Cuba.

Adams says UF's Institute of Food and Agricultural Sciences in no way advocates either lifting the embargo or keeping it in place. "We're just trying to describe the situation and provide information that would be useful for those who need it," he says, "in order to assess the potential impact if trade is ever resumed."

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