USMEF CEO Outlines Challenges and Opportunities in CubaMon, 05 Jan 2015 12:05:43 CST
When the Obama Administration announced that it is reestablishing diplomatic relations with Cuba and taking steps to ease trade and travel restrictions, the U.S. Meat Export Federation (USMEF) received several inquiries about Cuba's potential as a destination for U.S. pork and beef.
While restrictions on financial transactions and other constraints have made Cuba difficult to serve, the market has actually been open to U.S. meat exports for several years. U.S. pork exports to Cuba have been as high as $15.3 million in 2010, while the peak value for U.S. beef exports was just under $1 million in 2011.
USMEF President and CEO Philip Seng said there are some challenges in selling red meat to Cuba, primarily lack of private sector infrastructure as well as purchasing power. Currently, all export transactions must be conducted through a Cuban government entity (Alimport). Seng said for the past 30 to 40 years this government institution has bought all product coming through Cuba. This is different from any other country in the Caribbean or elsewhere around the world, as it is very state controlled. Seng believes there is a lot of work that has been done first before the US begins to see increased meat sales into Cuba.
Radio Oklahoma Network Farm Director Ron Hays featured Seng on the Beef Buzz feature. Click or tap on the LISTEN BAR below to listen to today's Beef Buzz.
USMEF's involvement in the Cuban market has also been limited because of a prohibition of using meat export promotion funds in the communist nation. Seng said the state department has had restrictions on using checkoff funding or the US Department of Agriculture's Market Access Program funding in Cuba and no change in these policies has been announced.
"So we have been really severely limited as far as having any engagement with Cuba," Seng said. "However we do have traders that have traded meat from the US and from other countries that have familiarity with the market there, but there is still a lot of development and a lot of change that is going to have to occur in Cuba before we can declare that Cuba is one of the leading markets in the Caribbean, but it does have promise. They do consume pork, they do consume beef and so we see there is an opportunity there, but we also have to bear in mind that for the last 40 years all the rest of the world has been trading with Cuba, except the United States. So a lot of our competitors definitely have a leg up on us."
So while the recent White House announcement represents a very positive step, the U.S. meat industry must still overcome many challenges in order to substantially grow pork and beef exports to Cuba. Seng said the U.S. is late to the party, but still there is export potential in this nation just 90 miles from Key West.
The Beef Buzz is a regular feature heard on radio stations around the region on the Radio Oklahoma Network- but is also a regular audio feature found on this website as well. Click on the LISTEN BAR below for today's show- and check out our archives for older Beef Buzz shows covering the gamut of the beef cattle industry today.
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