U.S. rice farmers seek Cuba market reopening as export pressures mount

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U.S. rice farmers seek Cuba market

Highlights

U.S. agricultural exports to Cuba have surged over 120% since 2016, reaching $477 million in 2023 despite strict financing rules and embargo constraints.
U.S. long-grain rice exports are projected by the USDA to fall to their lowest level in over 25 years due to subsidised Asian competition and rising input costs.
Louisiana and Arkansas can expand rice exports to Cuba due to proximity and matching product demand, but Cuba's hard currency shortages and foreign aid complicate near-term purchases.

Cuba demand seen as a potential export outlet

As reported by Financial Times, U.S. rice farmers and farm industry groups are pressing for broader access to Cuba, arguing the island could provide badly needed demand for producers in Arkansas, Louisiana and the wider southern rice belt. Cuba was once the biggest U.S. market for long-grain rice before the 1959 revolution, and farmers say proximity gives them a freight advantage that suppliers in Asia cannot easily match.

Jeff Rutledge, a rice farmer in Arkansas, says supplying even half of Cuba's rice needs would provide a major boost for the U.S. industry. He says his farm has ample supplies after weaker exports this year, and adds that rice could reach Cuba within weeks if the market opened, though limited Cuban access to hard currency and credit remains a major obstacle.

Despite the long-running U.S. trade embargo, some agricultural sales are still permitted under strict financing rules. U.S. agricultural exports to Cuba have risen by more than 120% since 2016 and reached $477 million last year, with shipments often channelled to small private-sector suppliers or sent by relatives in the U.S. through online platforms.

Cost pressures and regional trade implications

Farmers and processors say the Cuba opportunity matters because the domestic industry is under growing pressure from subsidised competition in India, Thailand, Vietnam and China, as well as higher fertiliser and fuel costs. The U.S. Department of Agriculture expects U.S. long-grain rice exports to fall to their lowest level in more than 25 years, reinforcing calls for new nearby markets.

Mike Strain, Louisiana's agriculture and forestry commissioner, says his state's exports to Cuba could probably double, while Arkansas Farm Bureau executive vice-president Jarrod Yates says the island's demand for rice and poultry closely matches the state's leading farm products. Both states are seen as well positioned to expand shipments because transport costs to Cuba are considerably lower than from more distant suppliers.

Cuba's own shortages of food, fuel and foreign currency are complicating any rapid increase in purchases. Vietnam is helping Cuban farmers grow rice, and China sent 15,000 tonnes of rice last month as part of a promised 60,000-tonne donation, but U.S. industry figures say deeper trade ties could eventually support broader two-way commerce and future agricultural investment if relations normalise.

Our earlier coverage of the EU’s advance toward ratifying a U.S. trade deal detailed how European lawmakers moved the agreement closer to final approval ahead of a threatened U.S. tariff deadline. We noted the deal would cut many EU duties on U.S. goods while adding safeguards against future tariff pressure, aiming to reduce uncertainty for transatlantic trade flows.

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