WASHINGTON, D.C. – Today, President Trump signed the 2018 farm bill (Agricultural Improvement Act of 2018) into law with a provision that will allow U.S. agricultural producers to use federal market promotion dollars for exports to Cuba. This is the first law to repeal part of the U.S. embargo on Cuba in nearly 20 years and lays the groundwork for comprehensive trade between the United States and Cuba.
The provision codifies the ability of U.S. farmers receiving U.S. Department of Agriculture (USDA) market promotion grants to direct those funds toward marketing their products in Cuba. These grants, under the Market Access Program (MAP) and Foreign Market Development (FMD) program, help U.S. farmers offset the costs of overseas marketing.
The included provision, as well as increasing agricultural trade between the United States and Cuba more broadly, was a cornerstone of Engage Cuba’s legislative priorities for the 115th Congress. “This is an important victory for America’s farmers, and will enable them to compete on a more equal footing to sell our agriculture products to Cuba,” said James Williams, President of Engage Cuba.
“It’s a rebuke to Cuban- American hardliners who have clung to a failed policy of isolation for the past 56 years. American farmers are the best in the world, and it’s a travesty that our archaic laws have prevented them from opening new markets so close to our shores,” Williams said.
The provision, introduced by Senator Heidi Heitkamp (D-ND), passed both chambers of Congress last week with wide bipartisan support.
Sen. Heitkamp’s MAP/ FMD amendment is part of the Senate Agricultural Export Expansion Act (S.275), which would also remove restrictions on private financing of U.S. agricultural exports to Cuba if passed.
A 2000 sanctions law exempts food sales from the U.S. embargo, but it bars U.S. sellers from offering financing or credit terms to Cuban purchasers and prohibits taxpayer-funded export assistance for sales to Cuba. The 2018 farm bill repeals the ban on export assistance by allowing the use of MAP/FMD dollars in Cuba. A provision to fully remove agricultural financing restrictions on Cuba was also considered but ultimately not included, despite ardent support from members of the House Agriculture Committee and national commodity groups.
Cuba imports $1.8 billion in agricultural products annually, but only a fraction comes from the U.S. due to the cash-only requirement. Opening Cuban markets to producers of commodities like poultry, soy, wheat, and dairy could deliver a muchneeded boost to U.S. agribusiness.
In September, a bipartisan group of over 60 agriculture associations, businesses, and elected officials across 17 states sent a letter to the leadership of the House and Senate Committees on Agriculture to urge the inclusion of both Cuba trade provisions in the final farm bill. The Congressional Budget Office determined in July that including the full agricultural financing bill would have saved American taxpayers $690 million over 10 years.