January 2, 2015
The Daily Iberian
By Horace Holloman III
Sugar cane farmers in the United States should have nothing to worry about as the nation tries to repair its trade relationship with Cuba, according to local industry officials.
On Dec. 17, President Barack Obama ordered the restoration of full diplomatic relations with Cuba and the opening of an embassy in Havana. This diplomatic restoration, however, won’t have an effect on Louisiana’s sugar industry, said Jim Simon, manager of the American Sugar Cane League.
“Cuba is not the (sugar) producing giant they once were in the 1950s,” said Simon in a phone interview Tuesday. “Back then, Cuba was such a big player.”
Cuba’s sugar industry over the past few decades has suffered huge declines due to a lack of production. At its peak in 1989, Cuba produced roughly 8 million tons in sugar output. In 2010, Cuba’s industry produced just 1.1 million tons, the lowest margin in 105 years.
Due to tumultuous harvest years coupled with the low price of sugar in the world market, Cuba converted more than 3 million acres of cane fields to produce other crops, per reports.
“There’s still a lot of legislative work that has to be done, but we don’t see any immediate effect,” Simon said. “Brazil and India are some of the big producers now so there’s really not much of a worry as far as Cuba is concerned.”
Sugar producers generate close to $10 billion a year for the U.S. economy, according to statistics from the American Sugar Alliance.
Louisiana, on average, produces 1.4 million tons of raw sugar.
Ricky Gonsoulin, owner of Gonsoulin Farms LLC in New Iberia, said as long as there is a fair trade market between Cuba and the U.S., local farmers should be able to easily compete with Cuba’s sugar industry.
“Right now they (Cuba) are dilapidated so they are way behind. It would take a significant amount of time to get to ours,” Gonsoulin said. “We can compete with any sugar industry in the world if we’re on a level playing field, whether that’s Louisiana or the U.S. We can compete with Cuba day in and day out.”
In 2012, Louisiana produced a record amount for raw sugar production, producing around 1.7 million tons of raw sugar. The crop in 2013 came close to the previous year’s record numbers at 1.5 million tons.
“If Cuba subsidizes the industry or has a pre-trade agreement like we did with Mexico, we can’t compete with a subsidizing industry,” Gonsoulin said.
A recent study from the ASA shows seven out of 10 Americans prefer buying domestic sugar, even if foreign sugar is cheaper.
Cuba’s industry is seeing a slight resurgence. Raw sugar production went up 20 percent with a 1.5 million ton output in the 2012-13 harvest and a 1.8 million ton output in 2013-14, according to statistics from Cuba’s Sugar Company Group AZCUBA.
Gonsoulin said in the distant future there’s no cause for concern but did note in the future there may be a reason to take a second glance. Though Cuba’s sugar industry is repairing itself, Gonsoulin said potential export to the country may not be an option.
“We are not concerned for our industry, but there may be some issues down the road that we may have to address,” Gonsoulin said. “(Exporting) I would think the possibility may exist, but we have to supply the domestic product first and right now the U.S. doesn’t supply enough for the domestic demands which is why we import.”
According to the ASA, the U.S. imports from 41 countries regardless of need.