Rep. Tom Delay says trade with Cuba will perpetuate tyranny there.
Others say he has a personal grudge against the country.
By Barry Shlachter.
Star-Telegram Staff Writer. Monday, Nov. 20, 2000.
KATY -- Rice farmer Raymond Franz has had to contend with a bone-dry growing
season this year and a harvest that has been almost too wet.
Now he counts an enduring Cold War relic among his list of business
concerns: restrictions on food exports to Cuba.
Recent congressional action opened the tantalizing possibility of resuming
food exports, which have been restricted for nearly 40 years. Sales to Cuba
could help Texas producers, who are facing high production and low prices, said
Trish Alderson, a spokeswoman with the Texas Rice Association.
Trade relations with Cuba may be a far-off abstraction to many Americans.
But in rice- producing communities like Katy, about 30 miles west of Houston, it
reaches into the living room.
Before Fidel Castro, Cuba bought 60 percent of the Texas rice crop, year in
and year out, recalled John Creed, 78, a retired rice broker in Houston.
Mahatma-brand rice, processed by what is now Houston-based Riviana Foods,
enjoyed a 30 percent market share of Cuba's packaged rice purchases.
Then the generations-old market was gone.
Castro stopped imports after the ill-fated U.S.-backed Bay of Pigs invasion
in 1961. Then Washington slapped on its own trade sanctions.
Last month, Congress agreed to lift embargoes on pharmaceutical and food
sales in late February 2001 to Iran, Libya, North Korea, Sudan and, with strings
attached, Cuba.
Unlike the others, Cuba cannot receive U.S. financing, government or
private, for agricultural sales and cannot sell its own food products here, such
as raw sugar that could be refined in Texas.
Cuban officials angrily denounced the final bill, saying no American
foodstuffs would be bought under such restrictions.
But American exporters, eyeing Cuba's agricultural imports of $1 billion a
year, haven't given up trying to salvage some sort of trade. Cubans annually
import 420,000 metric tons of rice at a cost of $86 million. The U.S. Rice
Federation believes that Cuba will eventually buy more than 550,000 tons worth
some $130 million, representing a fifth of America's rice exports and
challenging Mexico as our biggest customer.
Texas, which grew 692,000 metric tons in fiscal 1999, is the fifth-biggest
rice-producing state after Arkansas, California, Louisiana and Mississippi. But
with most of its rice mills near Gulf ports, Texas has a competitive advantage
in supplying Cuba.
Dwight Roberts, president of the Houston-based U.S. Rice Producers
Association, said at an international trade conference last week in Houston that
he's working to line up "third- party" financing, perhaps from
European lenders, to jump- start rice exports to Cuba. A French diplomat at the
conference, organized by Texas A&M and Texas Tech universities, said Paris
banks would love to oblige.
But a Cuban envoy at the gathering made clear that Havana would accept only
U.S. financing on American agricultural purchases.
The diplomat, Gustavo Machin, said that commercial financing from Canada or
Europe would be more expensive than U.S. government guaranteed agricultural
loans, which often come with below-market rates. The added cost of third- party
financing would price American rice out of the Cuban market, said Machin.
Aside from economics, it's good Cuban politics to reject the new
arrangement, said David Jordan, a University of Virginia professor and author of
`Revolutionary Cuba and the End of the Cold War.' "Castro needs the enemy
image of the United States -- `Imperialists imposing their rules on us,' "
Jordan said. "So he would object to any arrangement not completely to his
liking and continue to blame the Americans for various ills of the country."
But even the slight easing of the embargo is seen as the start of a trend,
if not major progress.
"It will take awhile to redevelop that market. I don't see the Cubans
switching over to our rice automatically," Franz said. "I'm sure it'll
come back slow."
Stumbling block
Ironically, one stumbling block is a powerful rice-country congressman --
House Majority Whip Tom DeLay, R-Sugar Land -- whose Southeast Texas district
includes Franz's Katy farm. DeLay has acknowledged that he worked with
Cuban-American congressmen to block the complete lifting of sanctions.
"Trade with Cuba is tantamount to the perpetuation of the Cuban
tyranny," the `Houston Chronicle' quoted DeLay as saying in a prepared
statement in April. "If we lift the sanctions in Cuba, Castro would be free
to export to the U.S. a vast array of winter crops, including tobacco, sugar and
citrus. Inevitably, Castro will dump Cuba's agricultural products on the U.S.
market to further hurt American sugar, citrus and tobacco farmers."
But there may also be a personal reason behind DeLay's anti-Cuban stance.
To numerous groups, including Texas rice farmers, he tells of traveling as a
child with his mother to Cuba shortly after Castro's takeover. At the airport,
he was separated from her at gunpoint, a terrifying experience for both. A DeLay
spokeswoman in Washington, Emily Miller, confirmed that he has given this
account numerous times.
"You can't budge him," Franz said of DeLay's position on Cuban
trade. "We'd like to see him not hold that personal grudge. He's
representing the state of Texas, and he's denying us that market over a personal
vendetta. ... It might just come back and bite him one day."
Texas: a `natural' market
Cuba now buys the bulk of its rice from Vietnam, Thailand and China. Even
with a long sea voyage, low-quality Vietnamese rice arrives in Cuba cheaper than
the price and shipping cost of Texas rice, said John Creed's son Mark, who, with
his brother, produces the weekly `Creed Rice Market Report' and an industry Web
site, www.riceonline.com.
The Texas advantage is the five-day shipping time vs. 45 to 50 days from
Vietnam. With a Texas supply, Cuba would not need to place huge orders, as it
does now, which require warehousing. Long-distance shipping and storage for
months in the Cuban climate increase the risk of spoilage, Mark Creed said.
"When you take into account transportation and warehousing, Texas rice
becomes competitive," said Machin, the Cuban envoy. "We are a natural
market for the United States."
But Creed cautioned that Cuba is far from the market it was in 1961.
"It will be like selling a Rolls Royce to a Volkswagen buyer," he
said. "They've been eating low-quality rice for years. That market has got
to be re-educated. We've got to do a real marketing job."
Then there's competition from Arkansas and Louisiana, Creed said.
"Prices will vary as the market varies," he said. "But would
Texas be in a good position to participate in that business? Yes. Logistical
costs for Texas mills are cheaper than those of inland mills."
Barry Shlachter, (817) 390-7718
bshlachter@star-telegram.com
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