By BECKY SHAY | Billings Gazette Staff
Jim Stinehagen has put in long days this week negotiating to make a huge sale of Montana products to Cuba.
On Wednesday Sen. Max Baucus announced an agreement with the Cuban government to purchase $15 million in agricultural products from Montana. About $10 million of that deal is peas, lentils and beans from Yellowstone Bean Co., of which Stinehagen is president and CEO.
“It really was quite a day,” Stinehagen said in a telephone interview with The Gazette from Cuba. “That $10 million in sales rolls seven times, so that means $70 million to the Montana economy.”
This is Stinehagen’s fifth trip to Cuba and he is amazed at how fast things moved during this excursion now that he knows who to talk to and “how to make things work.” The first round of negotiations was Wednesday afternoon, Stinehagen said, with another round scheduled for today and an agreement will probably be signed Friday.
A year ago, Stinehagen sealed a deal to send 6.6 million pounds of dry beans, worth about $1.5 million, to Cuba. The people he has worked with on this trip told Stinehagen they “appreciate having such a high-quality product.”
“Cuba only has so much money - $1 billion a year to feed 11.2 million people ,” Stinehagen said. “They have to buy right.”
Stinehagen said the agreement calls for shipping 21,000 metric tons, beginning in March and continuing each month through June. He intends to go to Cuba and meet each shipment.
“We’re going to be busy,” he said.
Yellowstone Bean Co.‘s northern location makes it difficult to compete, Stinehagen said. The company has an operation in Corpus Christi, Texas, that helps ease freight and shipping difficulties, he said.
“We have a tremendous freight advantage on the water out of Corpus to Cuba,” Stinehagen said.
Yellowstone Bean Co., which has elevators in Bridger, Terry and Powell, Wyo., is also shipping to Haiti, Puerto Rico and Mexico.
Although Baucus has worked to make the sales happen, government restrictions make them difficult to complete, Stinehagen said. A self-described “die-hard Republican,” Stinehagen said he is getting irritated with the federal administration that is eating up time and money with paperwork demands.
“Every shipment we have a notebook of paperwork about an inch thick,” Stinehagen said. “They are making it as difficult to do business as they can.”
The large sales and good business relationship is worthwhile, he said.
“My greatest feat in 2004 was Cuba became my largest customer, it took out Wal-Mart,” Stinehagen said.
Working out sales with the mega-retailer Wal-Mart is “like getting turned into a junkyard with a bunch of vicious dogs,” Stinehagen said. The Cubans are tough negotiators, he said, but “when you have a deal, you have deal.”
The sales worked out in this week’s agreement will stretch across 18 months, according to Baucus’ office. Montana products are still being sold to Cuba from the senator’s trip there last year with businesspeople.
Rich Owen, a member of the board of directors of CHS, said the organization continues to send an average of about 100,000 bushels of wheat to Cuba each month. The shipments are the results of an agreement reached last year when Owen made a trip to Cuba with Baucus.
“It’s not a huge business, but it’s a steady business and a real good relationship,” Owen said. “Business is continuing, we’re still moving grain. The trip down there really was a great thing for Montana.”