Salt in the Sugar

From a sugar mill in Oriente province last week, the image of Cuba's most persistent TV performer flickered onto the island's screens. As cameras caught his every move, Fidel Castro filled and stitch-closed a bag of sugar, symbolizing the end of the 1965 harvest. He then faced his audience with the best economic news in his six-year rule. This year's sugar harvest had reached 6,000,000 tons--a 60% gain since 1964 and a return to the crops produced before the Communists seized power in Cuba. "This was a decisive year," cried Castro. "Nothing can stop us now."

What Comes Naturally. U.S. intelligence has little reason to doubt Castro's figures. However, he was not reporting any economic miracle. The fact is that Cuba's Communists decided to concentrate on sugar simply because they failed at everything else. When Castro first took over in 1959, he scorned the country's traditionally sugar-based economy as a mere device for capitalist exploitation, and embarked on a drive for immediate industrialization. The grandiose plans never got off the ground, chiefly because of mismanagement and lack of funds. In the meantime, Cuba's sugar crops dwindled to nearly half the old yield, and Castro fell deeper into debt to his Iron Curtain partners.

Two years ago, the Russians tartly advised Castro to forget about factories and return to what Cuba could produce: sugar. All of a sudden, the whole island was mobilized, as Fidel said, to "win the harvest battle." Peasants who had been sent away to factory jobs were brought back as cane planters and cutters, swelling the work force from 150,000 to 200,000. Another 70,000 "volunteers" were pressed into service. Pictures of Castro himself wielding a machete flooded the country. Even so, it took two years, plus an exceptionally mild and dry spring, to reach the 6,000,000-ton level.

Marking Up. Pricing Down. How much of a genuine lift the big crop will give Cuba's staggering economy is debatable. Most of the sugar is already earmarked for Castro's Communist partners, leaving little for the world market. Of the total, 3,300,000 tons will go to Russia, Red China and other Communist countries at a price Castro claims to be "something over 6-c- per lb." This trade is strictly barter, and the Russians are notorious for their markups. Compared with what they would pay in the West, the Eastern European satellites shell out 59% more for Russian crude oil, 66% more for coke, 36% more for lead. Experts believe that Castro takes a similar beating.

As for the rest of the sugar, Castro will need to use about 1,500,000 tons (at 3 1/4-c- per lb.) to pay for buses from Britain, locomotives from France, ships from Spain. Domestic consumption will take 400,000 tons. That leaves 800,000 tons that he can sell on the world market. The trouble there is that so many people are producing so much sugar that the price has tumbled from 12-c- a lb. to 2-c- a lb. in 19 months. Altogether, in sales and barter with the free world, Castro can raise only about $145 million this year--hardly a bonanza, considering that Cuba got about $275 million for a smaller crop last year.

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