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Ag Groups, Banks Call for Loosening of Cuba Lending Restrictions | KTIC Radio

Ag Groups, Banks Call for Loosening of Cuba Lending Restrictions

Ag Groups, Banks Call for Loosening of Cuba Lending Restrictions

Legislation relaxing lending restrictions on agricultural trade to Cuba would provide a boost to U.S. farmers during a period of low commodity prices, the groups backing the Cuba Agricultural Exports Act (HR 3687) said at Sept. 14 congressional hearing.

“Any trade we can open up when it comes to U.S. rice, wheat, corn, beans, just opens up more markets for our U.S. farmers so that we can supply the rest of the world,” Matt Gibson, vice president at St. Louis, Mo.-based Bunge North America, said. “We’re going to have 2.3 billion bushels of corn left over after this harvest that has nowhere to go.”

The U.S. lost a billion dollars in potential farm sales to Cuba over a span of a few years as result of the restriction, witnesses testified at the hearing. “Between 2013 and 2015, the Dominican Republic imported $1.3 billion worth of agriculture products from the United States,” said Bunge’s Gibson, He noted that the two Caribbean islands have similar per capita incomes and populations. “During this same time, Cuba, however, imported only $262 million from the United States. That is over $1 billion to the U.S. agriculture industry left off the table due to the financing restrictions under which we must currently operate.”

HR 3687 would, in part, lift restrictions preventing U.S. agricultural companies from providing credit to Cuban entities to purchase agricultural goods. Since President Barack Obama began opening relations with Cuba in 2014, calls have grown for lifting credit restrictions to allow U.S. agribusiness to trade more freely with the nation.

While the legislation would be a net positive, more would need to be done before American farmers saw significant benefits, said CoBank ACB Senior Vice President of Agriculture Export Finance Karen Lowe. “I think in the short run there won’t be a very significant change, because many other things need to happen, particularly in terms of the creditworthiness of the importing entities in Cuba,” she said. “But we have to continue to keep the ball moving so that over a period of time we will create a level playing field.”

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