by Mike Sharkey
Staff Writer
For decades, the trade embargo levied against Cuba by the United States government prevented American companies from doing business with the Communist state located just 90 miles from Key West. The embargo also prevented Americans tourists from visiting one of the Caribbean’s best kept secrets.
While it’s still virtually impossible for an American to vacation in Cuba, the walls of commerce — despite the fact Fidel Castro is still in power — are slowly disintegrating. About a year ago, Crowley Maritime started shipping American agricultural products to Cuba. Last fall, several Jacksonville companies started shipping commodities such as frozen chickens, lumber and seafood to Cuba.
According to Robert Peek, manager of public relations for the Jacksonville Port Authority, there are 170 American companies in 30 states currently doing business with Cuba. The trick for Jaxport isn’t to be just one of the ports sending goods to Cuba, but to be the port of choice for goods being shipped from the East Coast. In Florida, Jaxport is in direct competition with Gulfport, but Peek said it will be a while before either port is able to separate itself from the other.
“I don’t know the volume we ship to Cuba, but goods are regularly going there,” said Peek. “The frequency and volume only the companies know. We handled seven million tons last year in imports and exports and Cuba is just a small percentage of that. But it’s new.”
The catalyst to opening the door to Cuba was seemingly the U.S./Cuba Food and Agricultural Exposition held in Cuba last September. At the expo, American companies were allowed to set up booths and pitch their products and wares. Although what can be shipped to Cuba is currently limited to agricultural products and a handful of necessities, the expo afforded many American businesses their first opportunity to see Cuba and its potential firsthand and the Cuban government and businesses the opportunity to see what America has to offer.
Karl Frisch, vice president of Beaver Street Fisheries, has been to Cuba three times since September, with the last trip in mid-December. Although he’s not doing a large volume of business with Cuba right now, Frisch does count them as a client and says Cuba represents a potentially valuable client down the road.
“It’s a good market and we are selling them goods,” said Frisch, noting that City Council vice president Lad Daniels gave a presentation to Council last week on the December Cuba excursion. Daniels pointed out that with 11 million people, Cuba could prove financially lucrative to many local businesses. “Obviously, there’s big potential. We go there to sell them food and help the people of Cuba.”
So does Lanahan Lumber. After two different hurricanes did billions of dollars worth of damage to southern Cuba last fall, Lanahan is taking an active role in helping the island nation rebuild.
“We can sell them lumber, which is classified as an agricultural product,” said Michael Lanahan, president of Lanahan Lumber. “They have a demand for lumber to rebuild their tobacco barns, which were destroyed by the hurricanes.”
Lanahan said long before Cuba agreed to accept his lumber, they sent a representative to Jacksonville to examine the product.
“Their inspector of quality came here and looked around at our facility,” said Lanahan. “They made sure there were no bugs or anything else like that.”
Like Peek and others, Lanahan is just as concerned with making Jaxport the top exporter of products headed to Cuba.
“What we’re trying to make happen is making sure the Port of Jacksonville is the logical way to ship these products,” said Lanahan, adding Crowley started with about three shipments a month and is now up to about 10 a month. “We think that will double within the next six months.”
Orchestrating much of what’s shipped is ICS Logistics.
“Technically, ICS Logistics doesn’t sell to Cuba,” said Terry Brown, president of ICS Logistics. “We are a third party logistics company. We help the vendors sell their product. If poultry comes in here, we fast freeze it, store it and Crowley loads it into containers and it goes to port for shipment.
“We serve several different clients, but I don’t see us getting into the commodity purchasing business. That’s not what we do.”
Brown, who has been to Cuba twice, reiterated what Lanahan and Frisch said about Jaxport.
“We, as well as Jaxport, are pushing to put more volume through Jacksonville,” said Brown. “There are three times more people in Cuba than in Puerto Rico. You can extrapolate that and see the potential for Jacksonville.”
Brown said relations between Cuba and the United States will have to improve much more before a wider variety of goods and services can be exported. While Canadians and Europeans have been vacationing in Cuba for years, until Americans are able to freely travel there, the export business will remain fairly limited. Brown said non-essential exports will depend greatly on Cuba’s willingness to open to travelers.
“It depends on how their economy develops,” said Brown. “Because of the tourists they do get, some upper-end items are already being imported. This is a great opportunity for someone like Beaver Street with their food service and they see that, too.”
Despite the initial in-roads these companies are making, Cuba still very much represents the great unknown. Brown said the future is difficult to predict because of economic and political factors.
“It depends on how well Cuba has the ability to purchase products on a cash basis,” said Brown, adding his impression of Cuba is positive and, overall, the people come across as friendly and open-minded. “I found the people, those under 40 years of age, very much pro-American. They have worked hard to learn English and in many cases they are very fluent. They are very social people and I did not have a bad experience. I went into it with a totally open mind and no preconceived notions.”
Brown believes Cuba will eventually open and many other industries will become viable options.
“They do need warehousing and things of that nature,” said Brown. “Just in the past year, Cuba has become the fifth-largest export market. That will get the attention of a lot of people.”