Mexico
Brad Kooima, Kooima Kooima Varilek, says cattle recover Tuesday after a KS plant closure headline hurt the market. Grains see a technical bounce with a lower dollar.
Jim McCormick with AgMarket.Net says Mexico, Canada and China are the top three export customers of the U.S. and account for 40% of total exports. So, if these countries retaliate it could be devasting for trade and ag markets.
Mike Minor, Professional Ag Marketing, says the markets shook off tariff talk and saw positioning end of month and before first notice day Friday.
Jim McCormick, AgMarket.Net, says corn and soybeans slid on possible tariffs being placed on Mexico, Canada and China. Wheat ends higher on short covering.
Trump said he would impose a 25% tariff on imports from Canada and Mexico until they clamped down on drugs, particularly fentanyl, and migrants crossing the border, in a move that would appear to violate a free-trade deal.
Randy Martinson, Martinson Ag, says market reaction has been muted to possible 25% tariffs on Mexico and Canada and 10% on China on the first day of the Trump administration.
New World Screwworm is a serious veterinary pest that can cause severe damage to livestock and wildlife populations. The detection of New World Screwworm in Mexico and the subsequent USDA actions may have significant implications on trade and travel.
The emphasis on domestic agriculture reflects a broader trend in Mexican policy that could challenge existing trade agreements and alter the dynamics of agricultural exports between the two countries.
Mexico is self-sufficient in white corn, used to make the country’s staple tortilla, but imports genetically-modified yellow corn from the United States which is used largely to feed livestock.
Mexico came in with another big buy of U.S. corn on Friday. USDA reported a sale of 781,322 metric tons of corn for delivery to Mexico.
The latest AEM numbers suggest concerns about falling farmer demand for new machines were not overblown.
We hope that President-elect Sheinbaum will realize how much agriculture matters, the value created and how helping farmers thrive can help Mexico be better too.
“Mexico’s decree, which runs counter to scientific findings and is in direct violation of USMCA, is negatively impacting American corn growers,” said Tom Haag, NCGA president.
In Mexico, corn is much more than a food crop—it’s a key part of the country’s heritage, culture and traditions. Mexico argues glyphosate and GMOs are dangerous to human health, and seeks alternative practices.
During a bilateral meeting on Thursday, U.S. Trade Representative Katherine Tai discussed with Mexico’s Secretary of Economy Tatiana Clouthier various issues concerning energy and biotech corn.
Representatives from the U.S., Mexico and Canada will meet in Cancun, Mexico this week to discuss a series of disputes, including Mexican energy and biotech policies and Canadian dairy barriers.
Mexico reached an agreement with food manufacturers to use only non-GMO corn in tortilla production across the country. The government says it plans to implement new import tariffs on white corn imports.
Over the 29 years of free trade, U.S. ag exports to Mexico increased both in terms of volume and value, although there were some years where growth was not positive.
Mexico claims because it is self-sufficient in GMO corn for food, it has not violated any trade agreements. Given the firm stances of both countries, it appears this situation will lead to a USMCA dispute settlement.
It may seem like years ago, but it was just this past June when farmers reported selling $8 cash corn and $18 cash soybeans. Today, cash prices look much different–hovering around $5.50 for corn and $13 for soybeans.
According to researchers at Ohio State University, most U.S. states will experience a “limited effect” of the dispute in the short term. But the long-term could significantly impact states such as Illinois.
By requesting consultations, the U.S. Trade Representative began a process to come to a settlement on ag biotechnology imports to Mexico. If a settlement is not reached, the issue will move to a full-blown trade dispute.
Mexico is accusing the U.S. of playing politics over the GMO corn issue, but NCGA CEO Neil Caskey says if Mexico wants non-GMO, they’ll need to pay a premium for it instead of violating a trade pact already in place.
The U.S. appears to be pursuing a case via USMCA on the matter: “That is going to happen, because we’re essentially in a circumstance where this is not a situation that lends itself to a compromise,” Vilsack said.
Mexico on Monday announced a new decree, effectively banning imports of GMO corn. Following the declaration, Mexico quickly softened it’s stance after facing backlash from the Biden administration.
Mexico’s new decree will indicate that if U.S. GMO corn passes the sanitary filters of the Federal Commission for Protection against Sanitary Risks (Cofepris), it will have no problem entering Mexico.
“With 90% of corn acreage in the U.S. being planted to biotech seeds and Mexico being the number one purchaser of U.S. corn, I’m concerned this decree is not being met with urgency it deserves,” said Sen. Grassley.
While Mexico wants to reduce its imports of corn by 30% to 40% by 2024, Mexico’s Deputy Ag Minister Victor Suarez told reporters that it cannot replace its imports of U.S. corn for livestock feed.
U.S. officials told Mexico its approach on biotech crops are still “not grounded in science,” and will face a USMCA battle if the matter is not resolved.
Mexico and Canada had challenged the U.S. method for calculating the regional content required under the USMCA trade pact for cars to have tariff-free access to the U.S.