U.S. exports to Cuba are up, driven by private businesses on the island and Miami firms
In a surprising development given Cuba’s worsening economy, exports of food and other goods from the United States were up last year thanks to an explosion of trade involving private small and medium enterprises on the island.
According to data gathered by the New York-based U.S. Cuba-Trade and Economic Council, which tracks business with Cuba, U.S. companies, many based in Miami and Hialeah, exported food and agricultural products worth $342.6 million. That’s a 12.4% increase from 2021, when private enterprises, known as pymes, were first authorized, and exports to Cuba reached $304.7 million.
Exports in December also jumped 58% from November, to $45.2 million from $28.6 million.
The export data for 2023 “is remarkable not only by the U.S. dollar value, but the substantial increase in the number of companies, primarily located in South Florida, who are exporting products from the United States to Cuba specifically in support of the reemerging private sector in Cuba,” said John Kavulich, the council’s president. “This data legitimizes these are real businesses, that there is commercial activity, and it is expanding.”
Cuba has been under a U.S. trade and financial embargo since the early 1960s, but there are several exceptions that allow for the export of food, agricultural products, medical supplies, humanitarian donations and several other categories of goods if they are to be used by the private sector and not the government.
Kavulich said exports other than agricultural products, medicines and donations, which are authorized under specific licenses and policies implemented by the Obama and Biden administrations, were approximately $24 million. Those include car sales of more than $5 million, in addition to trucks, vans and motorcycles.
PRIVATE BUSINESSES BUYING MORE
Since Congress made exceptions to the trade embargo in 2002 to authorize the sale of food and agricultural products, the Cuban state company Alimport bought the bulk of commodities that made up much of the commercial activity between the two countries.
But a deep decline in productivity due to government mismanagement and the flaws of a centrally planned economy, combined with the effects of U.S. sanctions, the COVID-19 pandemic and a decline in tourism, plunged the country into one of its worst economic crises in decades.
As the government’s ability to pay cash in advance for U.S. imports — a U.S. requirement to sell food and agricultural products to Cuba— has notably decreased, trade was supposed to take a hit.
But the opposite happened as small and private enterprises, which were first authorized in August 2021, filled the gap and started importing supplies for their businesses as well as food and goods to sell on the island.
The Council’s latest report and additional data shared with the Herald does not show which companies are the biggest exporters overall, nor which specific transactions involved the Cuban private sector and which involved Cuban state companies.
But there are clear signs much of the trade increase might be due to a flurry of private activity. For example, in 2019, before the pandemic halted international trade and private businesses were not yet authorized in Cuba, Cuban government enterprises imported only $257.6 million from the U.S. That’s $85 million less than last year.
The data shows privatesector activity is driving higher volumes of exports to Cuba, filling for the government’s decreased buying power and diversifying commerce between the two countries.
For years, the Council has tracked the top 10 food products and agricultural commodities exported to Cuba, which tended to be similar year over year, including chicken, soybeans, corn and pesticides, all imported by Alimport.
Last year, chicken was still the number one item exported to Cuba, but Alimport is no longer the only one buying poultry. The list now includes other items, such as condensed milk and coffee bought by private businesses to sell to Cubans on the island. And the top 10 products currently account for less of the total volume exported, as private businesses are buying a more products, including olive oil, butter, eggs, yogurt, vegetables, pasta, orange juice and other staples found in grocery stores as well as construction materials, household articles, clothing, appliances, electrical parts and even cars.
For example, last year, the top 10 products accounted for 88% of all of the food and agricultural commodities exported to the island, down from 99.6% in 2021.
WHICH COMPANIES EXPORT TO CUBA?
U.S. agricultural powerhouses that used to sell food to the Cuban government started selling food to Miami companies that act as intermediaries and are the ones exporting to the private sector in Cuba.
Below are the companies exporting food and agricultural products to Cuba in November 2023, according to data from the U.S. Trade and Economic Council. Most are based in South Florida. Fifteen out of the 27 companies are based in Miami; two have offices in Hialeah, and two others are in Doral and Miami Beach, respectively.
Atlanta-based AJC International (poultry, beef)
Atlanta-based Intervision Foods (poultry, beef)
Atlanta-based Gerber Agri International (poultry)
Miami-based Katapulk Marketplace (foodstuffs)
Miami-based Arcross Group Corporation (foodstuffs)
Gainesville-based Koch Foods (poultry, beef)
Doral-based Aparicio
Cargo Travel Services (foodstuffs)
Miami-based Pearl Merchandising And Distribution (foodstuffs)
Hialeah-based Flash Kingz (foodstuffs)
Miami-based Dancay (foodstuffs)
Naples-based Tuambia (foodstuffs)
Miami-based Three Star Investment (foodstuffs)
Miami-based Caribbean Express Trading (foodstuffs)
Hialeah-based OK International (foodstuffs)
Mississauga, Canadabased Gullcan Enterprise (foodstuffs)
Miami-based Up Level Investment (foodstuffs)
Fort Lauderdalebased Del Prado Trading (foodstuffs)
Miami-based Jo Business (foodstuffs)
Miami Beach-based Just 90 Miles (foodstuffs)
Chattanooga, Tennessee-based Koch Foods (foodstuffs)
Miami-based Miranda Export (foodstuffs)
Miami-based Jam 4 (foodstuffs)
Miami-based Savvy World (foodstuffs)
Miami-based Tree Logistics (foodstuffs)
Miami-based Cugranca (foodstuffs)
Miami-based Almendares Courier Solution (foodstuffs)
Miami-based Lions Capital (foodstuffs)
The Council’s data shows that some Canadian and Spanish companies with offices in Cuba are registering companies in Florida to export to the island. And some Cuban entrepreneurs are testing the limits of the embargo by opening subsidiaries of their companies in the
United States under other people’s names to be able to buy supplies and collect payments, the Herald has learned.
Some companies, such as Katapulk and Supermarket23, are owned by Cuban Americans based in Miami and have also built businesses around selling food that gets delivered to the island and can be ordered online. Who pays for that? Mostly Cubans who are in the U.S. or other countries and want to help their relatives on the island, though Katapulk, owned by businessman and music promoter Hugo Cancio, recently added an option to pay with a Cuban bank card.
Because Cuban entrepreneurs are also cut off from the international banking system due to the U.S. embargo, some Cuban entrepreneurs are opening their own online stores to sell food and get payments abroad so they can use that money to pay suppliers and expand their businesses.
THIS DATA LEGITIMIZES THESE ARE REAL BUSINESSES, THAT THERE IS COMMERCIAL ACTIVITY, AND IT IS EXPANDING. John Kavulich, president of the U.S. Cuba-Trade and Economic Council
MEDICINE AND HUMANITARIAN AID
The Council separately tracks the exports of healthcare products, which, despite Cuba’s propaganda claims, have been legal to export to Cuba since 1992. Unsurprisingly, given the poor state of healthcare in the country, that number took a hit last year, from $9.2 million in 2022 to $839,500.
As Cubans struggle with shortages of food and medicine, humanitarian aid increased last year from $30 million in 2022 to $36.5 million, according to the Council’s data.
But the Council acknowledged in its latest report that the data it gathers from companies, U.S. ports and government agencies might not account for the actual amount of goods and donations making it to the island. The total is presumably much higher when taking into account the food, medicine and other goods that U.S. travelers, mostly Cuban Americans, bring for their relatives in Cuba.