Posted October 20, 2003 by publisher in Cuba Business.
By BRUCE EDWARDS | Rutland Herald Staff
Vermont’s attempt to join a number of states that have established trade relations with Cuba has met with disappointment.
Beginning this spring, Vermont trade officials have explored the possibility of exporting agricultural commodities and products to Cuba. But a state trade official said that despite the good faith efforts of the Cuban government, Vermont’s agricultural commodities were too expensive when compared to what was being sold by other states.
Brad Broadwell of the Vermont World Trade Office said that a number of Vermont companies had expressed interest in possibly exporting their food and agricultural products to Cuba.
“It got down to a point where there were six businesses that were really interested and we thought could qualify for an export license,” Broadwell said.
He said an analysis concluded that the state’s apples and eggs were the most suitable commodities for export to Cuba. But when it came time to crunch the numbers, Vermont was not in the ballpark when it came to price.
Broadwell said Cuba is able to buy Washington Red Delicious apples at $13 a bushel, including shipping. He said the same bushel of Vermont apples would cost $20 for export.
“That’s a sizeable difference at 30 percent,” Broadwell said.
Eggs encountered a similar pricing problem.
There are a number of poultry and egg producing states that export to Cuba. Broadwell said the price of eggs for export fluctuates between 39 cents and 50 cents a dozen while the best price Vermont could come up with for export to Cuba was 75 cents a dozen.
He said as a small state with many small farms, Vermont is at disadvantage when competing against large states like Washington. Another drawback, he said, is that some states are close to major ports, which gives them another price advantage on shipping.
The 40-year-old U.S. trade embargo imposed on Castro’s Cuba remains largely in effect. But in late 2000, the United States authorized the sale of food, agricultural products, and medical supplies and equipment, provided Cuba pay cash for the goods it purchased.
Vermont’s WTO contacted Cuba about trade possibilities after Pedro Alvarez, the head of Alimport, the Cuban food import agency, expressed interest earlier this year in Vermont food and agricultural products.
Broadwell said that if a problem developed with the trade initiative he thought it would be in the area of obtaining an export license from the Bush administration, which has taken a hard line against Castro and the communist island nation of 11 million.
Instead, Broadwell said the real problem turned out to be one of economics.
“When I thought price, I knew it was an issue when comparing small farmers against larger farmers … but I didn’t realize that it would be so dramatic,” he said. “I didn’t realize it would be 30 percent (apples).”
Broadwell said his office received help from a number of sources, including Alexander Perez of Alimport, in an attempt to make trade with Cuba a reality. The office of Sen. Patrick Leahy, D-Vt., was helpful on export license issues while North Carolina’s Agriculture Department provided useful information on that state’s trade experience with Cuba. And Broadwell said most of the credit for laying the groundwork for Cuban trade belongs to WTO office manager Linda McDonough-Perez.
And while the initial trade initiative didn’t pan out, Broadwell wasn’t giving up on trade prospects with Cuba.
“I still hold out hope, to tell you the truth, that we can compete in the value-added stuff over time, maple syrup or the boutique-type cheeses, or jellies and jams from our natural food producers,” Broadwell said.
He added, however, that Cuba is more interested at the present time in importing agricultural commodities rather than food products.
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