When Mexican President Andrés Manuel López Obrador first unveiled a decree two years ago to ban genetically modified corn and effectively shut out most U.S. exports, Trump administration officials asked themselves the obvious question: Is he really serious about this?
It’s a question still being asked after the U.S. has flatly rejected the decree and threatened to challenge it under the U.S.-Mexico-Canada Agreement.
“The ball is in his court right now because we drew a line in the sand, saying we’re not accepting any deals,” National Corn Growers Association President Tom Haag tells Agri-Pulse. “We’re not compromising.”
The Biden administration made that clear when it sent Doug McKalip, chief ag negotiator for the U.S. Trade Representative, and Alexis Taylor, USDA undersecretary for trade and foreign agricultural affairs, to Mexico last week. López Obrador, reacting to U.S. opposition to the decree, offered a compromise proposal in December that would push the implementation of the decree until January 2025 – after the next Mexican presidential election – and effectively exempt yellow feed corn from the ban.
But McKalip and Taylor delivered the message that the proposal was unacceptable.
The Biden administration is making it increasingly clear that any Mexican law that casts genetically modified feed or food as a threat to food safety will not be tolerated by the U.S.
“We’re just trying to figure out what his motive is because he knows there’s going to be a lawsuit,” Haag said. “It doesn’t look good for him.”
It’s still unclear what López Obrador will do next, But Andrew I. Rudman, director of the Wilson Center’s Mexico Institute, said he doesn't think the Mexican president cares about threat of a USMCA case. “I think he’s going to do what he thinks is right," Rudman said.
And then there’s the matter of politics. López Obrador is confined to a single six-year term that expires in November 2024, and he wants his Morena party to win the next election.
“He would probably not pay a political cost if this ends up becoming a USMCA dispute, because the people who oppose his policy already aren’t going to vote for (his party),” says Rudman.
That means López Obrador, who has a 61% approval rating according to the Mexican polling company Oraculus, may be prepared to take the knocks that would come with yet another USMCA dispute.
Meanwhile, the López Obrador administration is enacting new subsidies for farmers and looking for other ways to increase domestic corn production.
López Obrador has been consistent in his drive to make Mexico more self-sufficient, and Rudman said the decree on GM corn is another aspect of that. It’s not biotechnology that Lopez Obrador is primarily concerned about, but rather the fact that the corn is American, not Mexican.
“This whole idea of Mexico is going to ban GMOs is more about ‘I want to grow our own corn’ and ‘I don’t want to have to import,'” Rudman said.
It’s a perspective shared by Juan Pablo Rojas Pérez, president of the National Confederation of Agricultural Producers of Maize of Mexico (CNPAMM), a group that calls itself the “leading organization in Mexico that represents the interests of corn producers.”
Allowing corn imports from the U.S. without any restrictions depresses domestic production and reduces prices for Mexican farmers, he told the media outlet Mexicampo in a 2019 interview.
Allowing imports to replace Mexican production, he said, is leaving the structure of the "basic Mexican food basket in the hands of agricultural producers in the United States and being adrift not only in this area but also in fuels and prices."
Meanwhile, the López Obrador administration is announcing new subsidies for farmers, promising to bolster domestic corn production and slapping a 50% tariff on exports of white corn to try and keep it in the country.
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Mexico’s Agriculture Department announced last week that it will begin paying some of the cost for farmers to haul their corn to the nearest elevator. That was about the same time that Victor Suarez, the department’s undersecretary of food self-sufficiency, was telling the public that Mexico hopes to somehow cut its dependency on feed corn imports by 30% to 40% by 2024.
The U.S. is the primary corn supplier to Mexico and shipped 16.8 million tons of corn to Mexico last year, according to USDA data.
Despite Suarez’s assertion that Mexico could somehow reduce its corn imports by about 7 million tons in just 12 months, he seems to understand that cutting out U.S. imports won’t be possible any time soon.
“We are not going to be able to produce an additional 16 million tons of corn that today is imported mainly for the livestock sector,” he said, according to a report by the Latin American news outlet Infobae. “We are going to make significant progress but we are not going to achieve the goal of substitution."
That may be why Mexico offered to exempt yellow feed corn from the decree in the December proposal, but López Obrador has remained resolute on his determination to keep U.S. white corn out of the Mexican food supply.
Segalmex – Mexico’s food safety agency – displays the motto “Without corn, there is no country,” and decided to tweet this on Monday: "White corn is mainly intended for human consumption, while the production of yellow corn is intended for the industry or the manufacture of balanced food for livestock production.”
But the Biden administration has already rejected the Mexican proposal to allow imports of yellow corn while restricting white corn. The compromise, according to a USTR-issued statement last week, is “not sufficient and Mexico’s proposed approach, which is not grounded in science, still threatens to disrupt billions of dollars in bilateral agricultural trade, cause serious economic harm to U.S. farmers and Mexican livestock producers, and stifle important innovations needed to help producers respond to pressing climate and food security challenges.”
López Obrador has “to decide which way he wants to go now," said NCGA's Haag.
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