WASHINGTON, July 28, 2017 – Mexico may talk about getting its grains from countries other than the United States, but Agriculture Secretary Sonny Perdue said today that he doesn’t think the country is serious.
In a brief teleconference this morning from Merida, Mexico, Perdue told U.S. reporters that Mexico realizes the benefits of having a “corner store” – the United States – to its immediate north.
Perdue traveled to Mexico Thursday for two days of discussions with his Mexican counterpart, José Calzada Rovirosa, ahead of negotiations on the North American Free Trade Agreement set to begin Aug. 16 in Washington.
Mexico is the United States’ third-largest export market for agricultural goods. Total ag exports in 2016 came to $18 billion, with corn ($2.6 billion) and soybeans ($1.5 billion) leading the way. Mexico is also the largest exporter of ag goods to the U.S. – with a dollar value of $23 billion in 2016, including fresh vegetables ($5.6 billion) and fresh fruit ($4.9 billion).
At a hearing before the House Agriculture Committee on Wednesday, Floyd Gaibler, a director of the U.S. Grains Council, said USGC had “strong but unconfirmed evidence that Mexico is slated to purchase between seven and eight cargoes of corn from South America beginning in August and September.”
Importers in Mexico have started to worry whether they can count on U.S. suppliers because of threats by President Donald Trump to pull the U.S. out of NAFTA.
But when asked whether Mexico is planning to buy corn and soybeans from Argentina or Brazil, Perdue said, “I did not get any indication that they are seriously considering that.”
He said that like any country facing “the threat of a lack of supply,” the country has been looking at alternative sources. “We would do the same thing” if faced with a similar situation, he said.
“They may act as if they’re having conversations,” he said. But “we have a corner-store location for their supply, and frankly, we will continue to take advantage of that.” The United States’ edge over other countries stems from its productive capacity, infrastructure, and relationships built over years of doing business, Perdue said.
Regarding another issue brought up at the House Ag hearing, Perdue acknowledged that fruit and vegetable growers in the U.S. have not benefited from NAFTA as grain producers have.
“Certainly, we understand that not all sectors in U.S. agriculture have benefited equally from NAFTA,” he said. “Some feel disadvantaged. Most of that arises from the complementary aspects of our growing seasons.”
“We would like to see how we can mitigate concerns from some of those sectors – certainly in the fruit and vegetable area,” Perdue said. He also noted that he has heard similar complaints while in Mexico, from grain producers there who are forced to compete with American growers.
Perdue also voiced concern about the upcoming NAFTA negotiations, saying he hopes agriculture is not used as a bargaining chip as the U.S. tries to bolster its manufacturing sector.
Although the ag sectors in both the U.S. and Mexico “have benefited tremendously” from NAFTA, “not all sectors have benefited uniformly,” Perdue said, mentioning U.S. manufacturing. “The president is rightly concerned about that.”
“The unfortunate thing is, in many trade negotiations or renegotiations . . . agriculture is always used as a retaliatory measure,” Perdue said. “Our goal is, first of all, to do no harm.”
Perdue also said he had received no specific direction on NAFTA from Trump.
On labor issues, Perdue said that while his ability to address farmworker shortages in the U.S. is limited, he told Mexican officials that the U.S. is working on guest worker program that would allow Mexican citizens to go back and forth between the two countries legally, on a seasonal basis.
To listen to the teleconference, go here.
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