Jacksonville shipping salivates about Cuba
Published by Florida Times-Union on September 3, 2006.
When Dick Morales was growing up in Cuba, his family's concrete products business would buy wire mesh from the United States. It was a product that would be shipped through the then-much-smaller Port of Jacksonville on its way to the island country.
"I came over to Jacksonville as a young man in the summers," said Morales, 68, who left Cuba when he was 22 and eventually settled in the city he had seen in his youth.
In the four-plus decades since Morales left, Cuba hasn't received deliveries of wire mesh or much else. But now - as politicians and analysts try to determine the state of Fidel Castro's health and figure out what will happen when power passes to others - there's a rising possibility that shipping could resume in coming years, a situation that could work to Jacksonville's benefit.
"It's definitely going to impact all of Florida," said Morales, who is treasurer of the board of the Jacksonville Port Authority, "and from the sea commerce point of view, in my opinion, Jacksonville will be the most impacted."
That impact on Florida is expected to be huge, said William Messina, an agricultural economist at the University of Florida who studies Cuba. Perhaps, he said, "more significant than anything in its economic history."
With a commanding presence in shipping to Puerto Rico and strong operations throughout the Caribbean, local shipping companies and industry experts say Jacksonville is in a good position to capitalize on any improvement in trade relations with Cuba. With established trade lanes from the port to the Caribbean as well as the infrastructure - highways and railroads - necessary to bring goods to the dock, Jacksonville has what several experts see as a good base upon which to build. Plus, some barriers to trade - particularly a politically active exile community - don't exist here.
"Because Jacksonville proper has no strong feeling toward the Castro regime, it might make the area more objective," Acre said. "Once you get away from South Florida, the interest in Cuba is all business. Down there, it's very personal and very political."
The relatively small amount of goods that now can be legally shipped to Cuba come from all over the United States, but that's for political reasons, particularly an attempt to create a broader base of support for the trade; absent those reasons, Messina said, Florida likely would supply the bulk of agricultural products and serve as a transshipment point for other goods.
"There's a lot to suggest that Jacksonville could be a major player in U.S.-Cuba trade," Messina said.
Jacksonville has a history of sending its ships to Cuba, dating back to gunrunners who brought men and supplies there in the days leading up to the Spanish-American war in 1898.
More recently, in 2001, Jacksonville-based Crowley Liner Services became the first company to ship goods from the U.S. to Havana in nearly 40 years.
(Crowley since has sent a number of ships to Cuba, although recently they leave from Port Everglades and include Havana as part of a route that also services Central America.)
Since the Trade Sanctions Reform and Export Enhancement Act of 2000 was enacted, more than $2 billion worth of food has been shipped from the United States to Cuba - including $540 million worth in the past year - said Kirby Jones, president of the U.S.-Cuba Trade Association.
Other nations are doing more, said Jones, whose organization fights to get the trade embargo lifted, but there's enough demand for American goods that food imports could be worth $1 billion a year.
But shipping that food is a business Jacksonville wouldn't gain without a fight. As well as South Florida ports, including the Port of Miami and Port Everglades, shipments now go to Cuba through Mobile, Ala., and Corpus Christi, Texas, among others. On a tonnage basis, the Gulf Coast ports seen the biggest shipments, although the majority of ships actually come from Florida ports.
The Gulf Coast ports concentrate on grain, particularly rice, according to data from PIERS Global Intelligence Solutions, a company that tracks waterborne import-export trade data, while Florida ports, particular Port Everglades and Jacksonville, handle things such as relief cargo, medical supplies and meat, and shipments like 22.5 metric tons of chewing gum. Almost all military goods bound for Guantanamo Bay - from welding bars to beer - pass through Jacksonville, filling a ship every other Wednesday.
That business builds upon a trade in which Jacksonville historically has stood strong.
"Jacksonville used to be one of the main shipping ports to Cuba," said Karl Frisch, vice president of Beaver Street Fishery, which in the past has sold to Cuba. "But Jacksonville has been less aggressive in going after that business."
To win it, Jacksonville will have to become more aggressive, said Lou Woods, a University of North Florida professor of geography and economics who has studied Cuba. Without the immigrant ties of South Florida - most of Jacksonville's Hispanic population is of Mexican origin - area shippers will have to compete on price, competition that will bring with it the same challenge it has in attracting other business; namely, that states like Georgia or South Carolina, with one or two ports as compared to Florida's 14, are able to put more money behind marketing efforts.
"When [Florida ports] attempt to get funding, it ends up being a spitting contest between Dade County and Escambia, between Hillsborough and Duval. There is an infrastructure and cost of construction disadvantage in Florida ports," Woods said.
Jacksonville could capitalize on shipping goods to Cuba that come in from Asia, which can be brought by rail from the West Coast ports, where they enter the country, to First Coast ships.
When - and if - Cubans do want made-in-China-and-shipped-through-America goods is a question, though, and no one expects an answer to come about overnight.
Cuba-watchers are uncertain how ill Castro actually is and, if he does die, no one knows how smooth the transition to power of Raul Castro - Fidel's brother and heir apparent - will be. "Things will change slowly," said Arce, the Commercial Service officer.
There still are many issues to be worked out if the situation changes, particularly the fate of expropriated property, UF's Messina said, and it doesn't matter how attractive a market Cuba is if the people don't have the economic wherewithal to buy things.
"The problem is there's no money in the country, no industry," Morales said. "Nobody's making concrete, nobody needs wire-welded fabric to make concrete pipes" like his family did.
Still, those who follow the affairs of the country are hopeful that American companies can find a place there.
"No one really knows what the political climate is going to be when [Fidel's] not there," Frisch said. "It's a beautiful country. I hope it opens up."