Moran’s Memo: Put America First by Lifting the Cuban Embargo
Approximately 95 percent of the world’s consumers live outside America’s borders. Markets in the United States will continue to evolve to meet domestic consumer demand, but the vast majority of the future growth in food and agriculture markets will be made through exports. And the best way to boost prices for American producers now and in the future is to export more of our agriculture products to these foreign markets.
Our country has begun to reevaluate its trade commitments and how we can put Americans first. For Kansas’ economy, America first means selling what we produce here around the globe. Keeping and creating jobs domestically is critical; but in agriculture, where American producers already have the advantage, protectionist trade policies make little economic sense.
Our farmers and ranchers produce the safest, highest-quality products in the world. Despite this advantage, we are in the midst of one of the worst economic downturns in farm country since the Great Depression with farm income down nearly 50 percent since 2013 and expected to continue its decline.
The 2016 harvest in Kansas and across much of the country produced record-breaking yields, but unfortunately, there are still large piles of wheat, corn and other grains sitting on the ground next to grain bins filled to capacity. Kansas farmers need more markets to sell the excess supply of food and fiber they produce. Meanwhile, only 90 miles from our shore, Cuba and its 11 million people offer a significant opportunity for increased exports. As in years past, I am again championing legislation that would lift our nation’s Cuba trade embargo so we can improve the outlook for American farmers and ranchers.
Cuba imports the vast majority of its food. In fact, wheat is Cuba’s second largest import, second only to oil. And when we don’t sell to Cuba, another country does. While our unilateral trade barriers block our own farmers and ranchers from filling this market, willing sellers such as Canada, France and China benefit at American farmers’ expense.
It costs about $6 to $7 per ton to ship grain to Cuba from the United States. It costs about $20 to $25 per ton of grain to ship from the European Union. However, this competitive advantage that our farmers ought to have when selling to Cuba is eliminated by regulations related to the embargo that drive up the cost of dealing with the United States.
To understand what we are missing out on, consider our current trade relationship with the Dominican Republic, another nearby Caribbean nation with a comparable population, income level and diet. Between 2013 to 2015, the Dominican Republic imported an average of id="mce_marker".3 billion in U.S. farm products. During the same time, Cuba imported just $262 million. That difference represents a billion dollars of exports that U.S. farmers are missing out on because of our trade restrictions on Cuba. There is a clear and substantial potential for increased exports if we lift the trade embargo.
My bill, the Cuba Trade Act, would amend our country’s laws so American farmers can operate on a level playing field with the rest of the world. I often say: In Kansas, we will try anything once – sometimes twice or even three times. However, when we have been trying something for more than five decades and it has yet to work, it is time to change direction.
The Cuban embargo was well intentioned when it was enacted. Today, however, it only serves to hurt our own national interests by restricting American freedoms to travel and to conduct profitable business. If we’re truly committed to putting America first, lifting the embargo is the strategic choice. I encourage my colleagues to recognize the need for this change, and to join me in my effort to open the Cuban market for the good of the American people.