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
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
U.S. Exports to Cuba, 2002 - November 2007 $450.0 Million Dollars $397.9 $372.8 $358.7 $400.0 $334.0 $350.0 $300.0 $254.3 New $250.0 Record Likely $200.0 in 2007 $141.2 $150.0 $100.0 $50.0 $0.0 2002 2003 2004 2005 2006 Jan-Nov 07 Source: U.S. Trade Internet System, www.fas.usda.gov/ustrade
U.S. Monthly Exports of Agricultural and Related Products to Cuba $70.0 Total: $1.87 Billion Million U.S. Dollars $60.7 $60.7 (Dec 01 - Nov 07) $60.0 $55.4 $55.4 $53.7 $53.7 $48.7 $48.7 $50.0 $44.9 $44.9 $43.2 $43.2 $41.1 $41.1 $38.5 $38.5 $37.9 $37.9 $40.0 $35.7 $35.7 $35.7 $35.7 $35.1 $35.1 $34.9 $34.9 $33.8 $33.8 $33.6 $33.6 $33.4 $33.4 $33.4 $33.4 $33.2 $33.2 $32.7 $32.7 $32.6 $32.6 $31.7 $31.7 $31.5 $31.5 $31.3 $31.3 $31.0 $31.0 $30.0 $30.0 $29.4 $29.4 $29.0 $29.0 $28.7 $28.7 $28.6 $28.6 $28.5 $28.5 $28.3 $28.3 $28.1 $28.1 $30.0 $24.6 $24.6 $24.5 $24.5 $24.3 $24.3 $24.3 $24.3 $24.0 $24.0 $23.7 $23.7 $23.6 $23.6 $22.7 $22.7 $22.4 $22.4 $21.8 $21.8 $21.7 $21.7 $21.4 $21.4 $21.2 $21.2 $21.0 $21.0 $20.8 $20.8 $20.4 $20.4 $19.9 $19.9 $19.5 $19.5 $18.9 $18.9 $17.9 $17.9 $17.9 $17.9 $18.0 $18.0 $20.0 $17.5 $17.5 $17.4 $17.4 $15.8 $15.8 $15.1 $15.1 $15.0 $15.0 $13.7 $13.7 $12.9 $12.9 $12.8 $12.8 $12.5 $12.5 $10.7 $10.7 $9.9 $9.9 $8.3 $8.3 $8.1 $8.1 $7.9 $7.9 $10.0 $7.5 $7.5 $5.9 $5.9 $4.6 $4.6 $4.0 $4.0 $0.0 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 Source: U.S. Trade Internet System, www.fas.usda.gov/ustrade
U.S. Ag Exports to Cuba, Major Products 2001 - November 2007 (Cumulative Total) Million U.S. Dollars Total: $1.56 Billion $400.0 (83.6% of Total) $329.7 $350.0 $305.6 $298.3 $261.6 $300.0 $250.0 $184.6 $183.8 $200.0 $150.0 $100.0 $50.0 $0.0 SB Products Corn Poultry Wheat Soybeans Rice Source: Foreign Agricultural Service, USDA; SB Products Include Soybean Oil, Meal, and Flour
State Share of Exports 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
Southern U.S. Agricultural Exports to Cuba, Major Products, 2006 Million Dollars $30.0 $89.4 Million Total $26.3 31.8% of U.S. Total $25.0 Products included are Grains, $20.0 Soybeans, Soybean Products, Poult Meat, Pork, Beef, Seeds, Cotton, $15.0 Animal Fats, & Wood Products $9.7 $8.7 $8.3 $10.0 $6.7 $5.6 $4.5 $4.3 $3.9 $2.9 $2.9 $2.3 $1.9 $1.3 $0.4 $5.0 $0.0 AR TX NC MS GA LA AL KY OK VA TN SC MD FL WV Source: U.S. Trade Intenet System, www.fas.usda.gov/ustrade
Composition of Southern U.S. Exports to Cuba, 2006 $89.4 Million Total Poultry Meat Soybeans & Products $30,219 $10,573 Wood Products $6,056 O ther Meats $2,814 O ther $1,430 Thousand Dollars Source: U.S. Trade Internet System, Grains www.fas.usda.gov/ustrade $38,279
Estimated Economic Impacts 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
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 output 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
Economic Impacts of Southern U.S. Exports to Cuba, 2006 Business Activity Income Employment (Million Dollars) (Jobs) Direct $89.4 $27.8 1,332 Indirect & $104.0 $48.9 669 Induced Total $193.4 $76.7 2,001 Source: Center for North American Studies, using IMPLAN Input/Output Model
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
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
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 of U.S. Agricultural Exports to Cuba . Center for North American Studies, CNAS 2002-2, April 2002 WISERTrade. www.wisertrade.org.
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