After Mexican GM corn import ban, American farmers ask: What now?

China gets most of the press on ag trade issues, but it’s easy to forget that the biggest destination for United States feed corn is Mexico, not China. Mexican yellow corn imports from the U.S. stood at $2.7 billion in 2019, according to U.S. Department of Agriculture-Foreign Agriculture Service data, making Mexico the U.S. feed industry’s largest export destination. Almost all of it was genetically modified corn.

That may change, however, now that the Mexican high court dismissed challenges from Mexican farm groups to a decree from Mexico’s president, Andrés Manuel López Obrador, banning importation of GM corn over a three-year phase-out period, apparently bringing an 18-month court fight to an end.

It’s not clear how soon imports could slow. López Obrador’s decree now has to be turned into regulations, a process that takes time, just as in the U.S. The U.S. has claimed that the measures violate the United States-Mexico-Canada Agreement negotiated by the Donald Trump administration to replace the North American Free Trade Agreement. So far there has been no word on whether the Joe Biden administration intends to pursue any appeal process in trade forums.

López Obrador won a landslide victory in 2019 elections, with strong rural support. Fulfilling a campaign promise, he banned glyphosate on Jan. 1, 2020. Two weeks later, he appended a decree banning the importation of GM corn. The moves are connected, because farmers plant corn that is resistant to glyphosate in order to use the effective broad-spectrum weed killer.

Intense campaign

According to internal emails published by the British newspaper The Guardian after being obtained in a freedom of information suit by a U.S. non-governmental organization, the Center for Biological Diversity, Bayer warned U.S. officials that Mexico’s actions in banning glyphosate and corn engineered to resist it could threaten $20 billion in U.S. ag exports.

Officials in the Trump administration mounted an intense campaign to persuade Mexican officials to drop the ban, with little effect. U.S. trade officials told Mexican officials their actions violated the USMC Agreement, negotiated by the U.S. to replace the North American Free Trade Agreement. A Mexican judge granted Bayer a temporary stay in April, but it was reversed a few weeks later.

López Obrador’s measure was in litigation in the Mexican courts until May 24 of this year, challenged by the Mexican Farm Council that claimed it will cripple Mexican livestock farming, which depends on imported feed. On May 17, shortly before the ruling was announced, President Joe Biden’s trade ambassador, U.S. Trade Representative Katherine Tai, held a virtual meeting with López Obrador in which she “emphasized the importance of several ongoing issues, including science- and risk-based regulatory approaches in agriculture … [and] an immediate resumption of authorizations of agricultural biotechnology products in Mexico,” according to the USTR’s website.

As Mexico develops its regulations, one question mark is how broadly the ban will be applied. According to Roger Bernard, a senior policy analyst at IHS Markit, “There are still potentially more questions than answers on this issue and USDA Secretary Tom Vilsack has pledged to keep working on it. Key is whether this [Mexican ban] truly applies to feed corn or if it is food-corn related. That’s a key.” Veteran agricultural consultant Scott Sigman also said many questions remain about how and when the ban might take effect.

Sorghum producers could benefit

However, the wording of Lopez Obrador’s decree suggests that self-sufficiency and “food sovereignty” may matter more to him and his rural supporters than the interests of Mexican producers who rely on exports and who use genetically modified organism feedstocks. Ag consulting firm Higby Barrett said the ruling will severely hurt the Mexican livestock industry. “The prospect of being price uncompetitive for feedstuffs will severely harm the Mexican animal industry’s ability to export meat. With less exports, the need for feedstuffs will also decline.”

Higby Barrett suggested that if the ban does include feedstocks, U.S. sorghum farmers could benefit. “Because sorghum is 96% the energy value of corn, to replace corn would require 16.7 million metric tons of additional sorghum imports. To add insult to injury, Mexico is currently in a major drought and Mexican animal operations will need to lean on the U.S. for extra feedstuff imports to offset domestic corn and sorghum losses.”

David Murray can be reached at [email protected].