Reform in Food Distribution

14:26 30Mar2009 Cuba revamps food distribution in efficiency move



* Cuba overhauls food distribution system

* Castro pushing to boost farmers' output

* Agriculture ministry to focus on food production



By Marc Frank

HAVANA, March 30 (Reuters) - Cuba has begun a major overhaul of its food distribution system as part of an effort to increase production and tackle inefficiency, farmers and cooperative producers said.

The vast state network responsible for purchasing and distributing 90 percent of farm output has been moved from the agriculture ministry to the domestic trade ministry, the sources said.

Their comments confirmed a brief report on state-run television last week saying the transfer was underway and that "agriculture will be left with what has to do with production."

The report said the number of state produce markets in the country would be almost doubled from 156 to 300.

So far, government officials have not spoken publicly of the moves, nor have official decrees been published.

But farmers are praising the steps because they say they will allow agricultural officials to concentrate on getting more food produced while leaving distribution to another ministry.

"It is a good measure linked to others they are taking. Agriculture should not be diverted from producing by other tasks," farmer Alfredo Rodriguez said in a telephone interview from the central province of Camaguey.

President Raul Castro has made increasing food production a priority since taking over for his ailing brother Fidel Castro just over a year ago.

The cash-strapped country imports some 60 percent of the food it consumes, spending nearly $2 billion last year.

Raul Castro has moved to decentralize control of agriculture, once centered in Havana, and to increase farm supplies. He has begun the massive leasing of fallow state lands to those interested in tilling it and has as much as tripled amounts the state pays for most agricultural products.

Local economists have applauded the measures, but say they fall short of the market mechanisms needed to improve output.



GOVERNMENT REORGANIZATION

The latest move followed a government reshuffle earlier this month that replaced eight ministers and several top officials and brought armed forces generals, former officers and middle-aged Communist Party officials into the cabinet.

Acopio is the name of the huge state-run purchasing and distribution system that has come under fire for being grossly inefficient.

There have been numerous reports in the local media this year of how part of a bumper tomato harvest rotted in the fields for lack of containers and transport to cart it away.

"Acopio functions as an intermediary between farmers and consumers and has no business being part of the agriculture ministry," farm cooperative member Diego Cosme said in a telephone interview from eastern Holguin province.

Raul Castro has promised to reorganize and downsize the government to make it and the state-run economy more efficient.

Cuba has around 250,000 family farms and 1,100 private cooperatives, which together produce about 70 percent of the country's food on less than one-third of the cultivated land.

The remainder of the land is owned by the state, and half of that lies fallow.

Some 90 percent of the food is purchased by the state and shipped to institutions ranging from hospitals and schools to work place lunchrooms, and also sold at state markets, with the remainder sold by farmers on the open market.

(Editing by Jeff Franks and Kieran Murray)