Trade Tiff Brewing Between U.S. and Mexico Over Ban on GMO Corn

Mexico has confirmed that the country does not plan to amend its ban on imports of GMO that is set to start in 2024.  Mexico's Deputy Ag Minister says the country is on track to cut is imports of U.S. yellow corn by half through increased domestic production.  Mexico is a top customer for U.S. corn, accounting for 20 to 25% of U.S. corn exports annually. So, this is a huge issue.  

Mexico is back tracking on their reassurances made a year ago that they would not limit imports of GMO corn from the U.S.   Instead, they say they'll make direct deals with farmers in the U.S, Argentina and Brazil who produce non-GMO corn to supply their need outside of domestic production.  However, market experts say this is simply not doable.
Rich Nelson, with Allendale, "We've heard this story for the past two years.  We all understand from the U.S. grain market perspective we simply don't think it's going to be realistic.  Mexico gets about 90 to 92% of its corn from the U.S., 15 million ton annually and it our GMO corn that's about 92% of our product."  

In fact, 92% of the world corn supply is GMO.  So, Nelson says South America will have difficulty guaranteeing that volume of non-GMO product.  He says, "Now you can certainly argue that Brazil is going to be much cheaper than us right now to cargo in but the question is do they have the supply of non-GMO corn that can be verified?"

Mexico claims their decree is not a violation of the U.S. Mexico, Canada Agreement, saying the country was "under no obligation to buy and grow GM corn."   But officials with the National Corn Growers Association disagree. Angus Kelly is NCGA Director of Public Policy says, "There are numerous violations under section 31 of the U.S. Mexico Canada agreement if you want to get technical, part of which, if you're going to reject an application from an RD company for whatever biotech product then you need to do it with some sort of scientific basis."   He says this is potentially arbitrary and capricious and they're calling for trade action.  "We need the U.S. trade representative as the chief negotiator for the Biden Harris White House to file a case.  We think it's a maybe not a layup but certainly an easy, you're inside the free throw line in terms of winning the case."

And it's not just a ban on GMO corn, Mexico is also moving ahead with their ban on corn produced with herbicides like glyphosate and glufosinate which Kelly says is also a violation of USMCA.   NCGA officials say this import action also impacts a cross section of other U.S. ag commodities that are biotech or produced using glyphosate and glufosinate.
  So they're asking other groups to join with them to press the USTR for trade action.  Kelly also points out it impact white corn so it's a food security issue for Mexico.