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U.S. grains may avoid Mexico’s tariff hikes, concerns remain

Mexico’s Secretary of Economy announced yesterday a plan to implement tariffs on 90 U.S. agricultural and industrial products. The announcement is speculated to have been triggered by the cancelation of a 2007 U.S. pilot program that allowed Mexican trucks full access to U.S. highways.

“We do not know for sure what agricultural commodities will be on the list,” said U.S. Grains Council Senior Director of International Operations for Rest of the World Chris Corry. “I would speculate, however, that corn and sorghum will not be. The point of developing this list is not to stimulate the falling Mexican economy, which relies heavily on grain imports. The Secretary of Economy wants to avoid products that would be found in the “basic basket” (a method of tracking food prices and inflation), which includes about 22-23 commodities, including corn, rice, wheat, beans, corn flour, etc.”

Corn and sorghum are grain commodities utilized by Mexico’s livestock, poultry and food sectors. “If Mexico allows a tariff on corn and sorghum, it will have a direct effect on their feed and food prices. This in turn will increase the prices of meat, milk and eggs, their basic staples. It would behoove the Secretary of Economy to keep U.S. corn and sorghum off their tariff list,” said USGC Director in Mexico and Central America Julio Hernandez.

National Corn Growers Association (NCGA) Chairman Ron Litterer said, “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. This is not a single commodity industry; we're all in this together.”

TAGS: Corn
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