Rare is the week when a sitting president makes a trip to not one but two countries important to us here in South Florida, but that’s exactly what happened last week.
President Barack Obama was in both Cuba and Argentina.
From a trade perspective, any discussion of Cuba is largely a discussion about tomorrow, given that the trade embargo eliminates the possibility of U.S. imports and greatly limits the types of U.S. exports.
As a South Florida trade partner in 2015, Cuba ranked No. 87, behind nations like Ghana and Latvia and a smidgeon ahead of Bangladesh. Total trade for the year: $26.52 million. To provide some context, South Florida trades more with Brazil in a day than with Cuba in a year.
Most of South Florida’s exports to the island are sent from Port Everglades, to the tune of $25.35 million in 2015. That’s mainly chicken, as permitted under the embargo and being shipped by Crowley. That was enough for it to rank as the third most important U.S. port for Cuba trade last year, trailing the Port of Norfolk, Virginia, and JaxPort in Jacksonville.
Neither PortMiami nor Miami International Airport sent even $650,000 in exports to Cuba last year, according to WorldCity analysis of U.S. Census Bureau data. Again, what can be sent is limited, as are the financial terms of that trade.
Argentina, however, is a different story.
With a new president, Mauricio Macri, taking a number of business-friendly steps, including beating back those that had been stifling imports into the South American nation and attempting to end a long stalemate over a debt default that served to keep it out of global financial markets for years, Argentina is poised to rebound. That should benefit South Florida’s trade community.
▪ Argentina’s 2015 trade with South Florida was a record $3.2 billion, the third record in five years.
▪ It was South Florida’s eighth most important trade partner in 2015, up three in rank.
▪ It re-entered the top 10 for the first time since 2008, when it had ranked No. 10.
Miami International Airport was once again Argentina’s most important gateway for U.S. trade in 2015, replacing the Port of Houston, which had been No. 1 for four years. The third most important gateway was Port Everglades. (PortMiami ranks No. 37, with limited trade with Argentina.)
The first thing to understand about South Florida’s trade with Argentina is that it is heavily tilted toward South Florida exports. For every dollar of trade between MIA and Argentina, 87 cents is an export from the airport. That percentage at Port Everglades is 88 cents on the dollar. When you look at South Florida’s trade with the world, that figure drops to 55 cents.
For South Florida as a whole, exports totaled $2.85 billion while imports totaled $391.59 million.
Argentina is buying what South Florida has, and here is what it is:
Computers. Although the 2015 total of $251.77 million is well below the record of $313.03 million in 2011, it remains No. 1, as it has since 2004.
Cellphones and related equipment. The 2015 total was a record, at $218.97 million.
Civilian aircraft, engines and parts. Up strongly from 2014 but below the 2013 record, this is the third and final export valued in excess of $200 million.
Computer parts and accessories. Again, down from the record years but up from 2014, with a 2015 total of $147.73 million.
Medicine. The fifth and final export valued in excess of $100 million, this one has grown rapidly, setting a record eight of the last nine years. These tend to be pills for heart conditions, high blood pressure and to treat depression but include others.
Overall, exports grew 15.01 percent in 2015 from the previous year, including a 52.40 percent increase in shipments of computer chips, the seventh most important export, and a 224.40 percent increase in the category that includes plasma and vaccines, the No. 10-ranked export, up from No. 23 the previous year.
How important is a 15.01 percent increase in exports? Overall, South Florida exports to the world fell 10.62 percent in 2015.
Among South Florida’s top 10 trade partners, Argentina’s was the most rapid growth rate and the most in dollar terms, at $372.33 million. Some of this growth can almost certainly be attributed to regulations that affected trade flows that had first moved through neighboring Uruguay, but the trend line is, nonetheless, positive for Argentina.
Overall, 14 of the top South Florida exports to Argentina increased in value in 2015, 10 of the top 15 are up from two years ago and 12 of 15 from five years ago.
As limited as they are, Argentina does have imports that find their way to South Florida. But no single import totaled more than $100 million in 2015.
Silver is certainly the fastest growing among the leading imports, having more than doubled in value in 2015 from the previous year and up more than sevenfold from the year before that. It has jumped from a rank of 456 in 2010 to No. 2 in 2015. Blueberries are also a large import as is wine, though 2015 was not a particularly good year for either, with the former down 8.78 percent and the latter down 10.50 percent.
The Port of Houston had been the No. 1 port for four years prior to 2015, when MIA replaced it, because of its strong ties to the energy sector. The dominant import was seamless iron and steel pipes, jumping from $40.70 million a decade ago, in 2005, to a record $770.49 million in 2013. Plunging oil prices have taken their toll. Those imports totaled just $492.90 million in 2015, allowing strong exports from MIA to put it back on top.
Recent columns for Business Monday have included:
South Florida exports to Argentina
Of the top 15, 14 increased in value.
Total South Florida exports to Argentina
Cellular, landline phones, parts
Civilian aircraft, engines, parts
Printers, all types, parts
Military aircraft engines, engine parts
Medical instruments for surgeons, dentists, vets
Plasma, vaccines, blood
Video games, other games
Parts for heavy machinery
Taps, cocks, valves for pipes, tanks
Medical equipment for physicals
Source: WorldCity analysis of U.S. Census Bureau data