Grain Industry Monitors New Mexican Tariff Plan

NAFTA be darned, south-of-the-border moves may, or may not, impact some ag products.

Published on: Mar 18, 2009

This week Mexico's Secretary of Economy announced a plan to implement tariffs on 90 U.S. ag and industrial products in response to cancellation of a 2007 U.S. pilot program allowing Mexican trucks full access to U.S. highways. Chris Corry, U.S. Grains Council Senior Director of International Operations, comments: "We do not know for sure what agricultural commodities will be on the list. I would speculate, however, that corn and sorghum will not be."

Corry says the point of developing the list is not to stimulate the falling Mexican economy, which relies heavily on grain imports. He notes he Mexican Secretary of Economy wants to avoid products that would be found in the "basic basket" (a method for tracking food prices and inflation), which does include about 22 to 23 commodities including corn, rice, wheat, beans and corn flour.

"If Mexico allows a tariff on corn and sorghum, it will have a direct effect on their feed and food prices," Corry says. "This in turn will increase the prices of meat, milk and eggs, their basic staples."

In a press statement, National Corn Grower Association Chair Ron Litterer says: "NCGA is currently monitoring the impact this tariff barrier will have on U. S. farmers. Although corn is unlikely to be on the list, we are still concerned about the ramifications this truck restriction will impose on all of U.S. agriculture."

The list of commodities is expected to be released today.