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Estimated Economic Impacts of U.S. Agricultural Exports to Cuba on the South Poster Presented at SAEA Annual Meetings, February 3-5, 2008 Flynn Adcock, Georgia Clark, and Parr Rosson Center for North American Studies Department of Agriculture

SLIDE 1

Estimated Economic Impacts of U.S. Agricultural Exports to Cuba on the South

Poster Presented at SAEA Annual Meetings, February 3-5, 2008

Flynn Adcock, Georgia Clark, and Parr Rosson Center for North American Studies Department of Agriculture Economics

Texas Agrilife Research and Texas Agrilife Extension Service

SLIDE 2

Background

Prior to Embargo, U.S. Owners Held 25% of All

Arable Land in Cuba (2/7/1962)

Sugar, Citrus, Vegetables, Cattle
Trade Sanctions Reform & Export Enhancement

Act, 2000, Allows US Exports

Top 25 Market for US Agriculture & Forestry
U.S. Began Exporting Agricultural Products in

December 2001 following Hurricane Mitch

U.S. Agricultural Exports to Cuba Reached their

Peak in 2004, but 2007 will Likely Be a New High

The Southern U.S. Has Benefited from U.S. Exports

to Cuba

SLIDE 3

U.S. Exports to Cuba, 2002 - November 2007

Source: U.S. Trade Internet System, www.fas.usda.gov/ustrade

$141.2 $254.3 $397.9 $358.7 $334.0 $372.8 2002 2003 2004 2005 2006 Jan-Nov 07 $0.0 $50.0 $100.0 $150.0 $200.0 $250.0 $300.0 $350.0 $400.0 $450.0 Million Dollars New Record Likely in 2007

SLIDE 4

U.S. Monthly Exports of Agricultural and Related Products to Cuba

Source: U.S. Trade Internet System, www.fas.usda.gov/ustrade $4.6 $9.9 $13.7 $7.9 $17.5 $5.9 $17.9 $7.5 $10.7 $15.8 $4.0 $20.8 $8.1 $15.0 $12.8 $17.4 $20.4 $21.4 $12.9 $22.4 $12.5 $18.9 $24.3 $35.7 $33.8 $33.6 $23.6 $60.7 $55.4 $32.7 $37.9 $30.0 $24.6 $8.3 $17.9 $28.1 $31.0 $29.4 $21.2 $41.1 $35.1 $24.5 $33.2 $19.5 $28.7 $19.9 $21.8 $32.6 $31.5 $34.9 $29.0 $31.7 $43.2 $18.0 $24.0 $33.4 $15.1 $28.3 $24.3 $35.7 $23.7 $22.7 $21.7 $21.0 $48.7 $28.6 $28.5 $38.5 $53.7 $31.3 $33.4 $44.9

                                                                       

$4.6 $9.9 $13.7 $7.9 $17.5 $5.9 $17.9 $7.5 $10.7 $15.8 $4.0 $20.8 $8.1 $15.0 $12.8 $17.4 $20.4 $21.4 $12.9 $22.4 $12.5 $18.9 $24.3 $35.7 $33.8 $33.6 $23.6 $60.7 $55.4 $32.7 $37.9 $30.0 $24.6 $8.3 $17.9 $28.1 $31.0 $29.4 $21.2 $41.1 $35.1 $24.5 $33.2 $19.5 $28.7 $19.9 $21.8 $32.6 $31.5 $34.9 $29.0 $31.7 $43.2 $18.0 $24.0 $33.4 $15.1 $28.3 $24.3 $35.7 $23.7 $22.7 $21.7 $21.0 $48.7 $28.6 $28.5 $38.5 $53.7 $31.3 $33.4 $44.9 Dec '01 Jan '02 Apr Jul Oct Jan '03 Apr Jul Oct Jan '04 Apr Jul Oct Jan '05 Apr Jul Oct Jan '06 Apr Jul Oct Jan '07 Apr Jul Oct

$0.0 $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 $70.0

Million U.S. Dollars Total: $1.87 Billion (Dec 01 - Nov 07)

SLIDE 5

U.S. Ag Exports to Cuba, Major Products 2001 - November 2007 (Cumulative Total)

Source: Foreign Agricultural Service, USDA; SB Products Include Soybean Oil, Meal, and Flour

$329.7 $305.6 $298.3 $261.6 $184.6 $183.8

SB Products Corn Poultry Wheat Soybeans Rice

$0.0 $50.0 $100.0 $150.0 $200.0 $250.0 $300.0 $350.0 $400.0

Total: $1.56 Billion (83.6% of Total) Million U.S. Dollars

SLIDE 6

Calculated State Share of U.S. Production for

a Commodity Sector Based on Volume

Applied State Share of Production Percentage

to Total Commodity Sector Exports to Obtain State Share of Exports Based on Value

Repeated Process for Each Commodity Sector

in each State, then Summed Across States

Based on Methodology Used by Economic

Research Service, USDA

State Share of Exports

SLIDE 7

Southern U.S. Agricultural Exports to Cuba, Major Products, 2006

Source: U.S. Trade Intenet System, www.fas.usda.gov/ustrade

$26.3 $9.7 $8.7 $8.3 $6.7 $5.6 $4.5 $4.3 $3.9 $2.9 $2.9 $2.3 $1.9 $1.3 $0.4

AR TX NC MS GA LA AL KY OK VA TN SC MD FL WV

$0.0 $5.0 $10.0 $15.0 $20.0 $25.0 $30.0 Million Dollars

$89.4 Million Total 31.8% of U.S. Total

Products included are Grains, Soybeans, Soybean Products, Poult Meat, Pork, Beef, Seeds, Cotton, Animal Fats, & Wood Products

SLIDE 8

Composition of Southern U.S. Exports to Cuba, 2006

Source: U.S. Trade Internet System, www.fas.usda.gov/ustrade

Grains $38,279 Poultry Meat $30,219 Soybeans & Products $10,573 Wood Products $6,056 O ther Meats $2,814 O ther $1,430

Thousand Dollars

$89.4 Million Total

SLIDE 9

Using 2006 Data for the Input-Output

Model IMPLAN, Constructed a Model for the Southern U.S.

Input the Estimated Southern U.S. Exports

to Cuba into the IMPLAN

Output included the amount of Business

Activity, Income, and Employment Required to Support the Exports

Direct Impacts Related to Exported Commodities
Indirect/Induced Impacts Related to Supporting

Industries

Estimated Economic Impacts

SLIDE 10

Types of Economic Impacts

Employment: Total number of paid

employees, including part time workers

Part time workers are counted as full time

equivalents

Business Activity: The value of industry
utput or industry sales
Income: Wages, proprietor income, other

income, indirect business taxes

Same as Gross State Product (GSP)

CAUTION: Income is included within Business Activity So, DO NOT Double Count them

SLIDE 11

Economic Impacts of Southern U.S. Exports to Cuba, 2006

2,001 $76.7 $193.4 Total 669 $48.9 $104.0 Indirect & Induced 1,332 $27.8 $89.4 Direct

(Jobs) (Million Dollars)

Employment Income Business Activity

Source: Center for North American Studies, using IMPLAN Input/Output Model

SLIDE 12

Southern Ports Dominate

Over 99% of U.S. Agricultural Export to Cuba are Shipped through Southern Ports, Led in 2006/07 by: 1) New Orleans, LA 2) Port Everglades, FL 3) Gramercy, LA 4) Houston, TX 5) Norfolk, VA

SLIDE 13

Summary

U.S. Market Position Strong, but Future

Prospects Clouded by High Prices & Competition

Tourism Key to Market Growth in Near Term,

Along with Sugar, & Nickel Exports

Cuba the Top Carib Grain Market
Latent Demand for Meats, Especially Pork &

Beef, Most Consumer Products Currently for Tourists

Optimism About Recent Oil & Gas

Discovery in Cuba

SLIDE 14

References: Foreign Agricultural Service, USDA. U.S. Trade Internet

System. www.fas.usda.gov/ustrade

Minnesota Implan Group. IMPLAN Professional 2.0 National Agricultural Statistics Service, USDA. Ag Statistics

2007. www.usda.gov/nass/

Rosson, Parr and Flynn Adcock. U.S. Agricultural Exports to Cuba Down Slightly in 2006, Center for North American Studies Issue Brief 2007-02, March 13, 2007 Rosson, C. Parr, III and Flynn J. Adcock. Economic Impacts

f U.S. Agricultural Exports to Cuba. Center for North

American Studies, CNAS 2002-2, April 2002

WISERTrade. www.wisertrade.org.