Economist: Effect of Mexican 2024 Ban on GMO Corn Uncertain for U.S. Producers

The Mexican government announced it will be phasing out GMO corn and glyphosate by 2024. Mexico is one of the largest importers of U.S. corn, so that announcement caused concern in the U.S. agricultural sector. David Widmar, an agricultural economist with Agricultural Economic Insights, says there are a lot of questions about how this move by Mexico’s government will work.

“One of them is the impact on domestic production in Mexico. The implications of that ambiguous decree, and also the implications for corn that is used for human consumption. The other side of the coin is livestock feed. And the last piece here is what about corn imports? So, there’s kind of one version of this where absolutely no GM corn is allowed to be produced or consumed or imported into Mexico. And then there’s sort of the other variation where there’s some exception for corn that is fed to livestock or that goes into the feed supply chain, and then also potentially corn that’s imported, so they could still import GM corn to feed their livestock. But maybe they’re not producing it. That’s sort of the high-level take.”

About 25 percent of all U.S. corn exports go to Mexico, but the way they use most of the imports has changed.

“The story in Mexico has been evolving over the last two decades where in 2000, we would have said the Mexican corn situation is mostly driven by domestic production, and it goes into the food sector. Over time, we have seen that shift to a majority of the corn going into feed, and a growing share of their supply comes from imports. About 40 percent today of all the corn that they use comes from imports, so this is important to keep in mind as we think about where all this comes together.”

He says the effect on U.S. corn producers will depend on how far the Mexican government takes their ban.

“There is a scenario here where they’re not going to allow any GMO corn in the country. That seems like the most aggressive, most literal sort of interpretation of how this might play out, and that could limit how much corn goes into the country. Keeping in mind that Mexico gets 90-plus percent of its corn from the U.S, that’s going to have a potential ripple through the entire corn trade situation. Now, if there is an exemption where GM corn can be fed and can be imported, there might be sort of minimal impacts at the sector level, at sort of the entire U.S. farm economy.”

Mexico’s livestock industry may limit the scope of the ban on GM corn import.

“Mexico feeds more corn into livestock than they import, so there is some possibility here where they have a domestic production situation that’s GM free, they have usage for human consumption as GM free, and then they rely on imports of GM to go into their animal feed. So that is a theoretically feasible situation.”

For more information on their thoughts about Mexico and corn, go to www.aei.ag.

Related articles

Senators Fischer and Klobuchar Introduce Year Round E15 Legislation

On Tuesday, Nebraska Republican Senator Deb Fischer along with Minnesota Democratic Senator Amy Klobuchar introduced the Consumer and Fuel Retailer Choice Act. The legislation, also backed by 13 bipartisan Senators, would allow the sale...

Mexico Is Open to Deal with U.S. on GMO Corn

Agriculture Secretary Tom Vilsack met with Mexican President Andrés Manuel López Obrador earlier this week. The leaders discussed a looming decree by the Mexican president that would ban imports of biotech corn into the...

Removal of Trade Barriers Could Increase China’s Ag Imports

China imported more than $205 billion of agricultural products in 2021, including more than $37 billion from the United States. However, USDA Economic Research Service points out that trade barriers deterred China’s imports from...

Impacts of Rail Strike Would Precede Walkout, Paring Congress’ Time to Act

A threatened rail strike could have widespread effects on agriculture, manufacturing and the rest of the nation’s economy days ahead of a walkout. Congress must act sooner than the December 9 strike deadline since the...

Ag Organizations Call for McKalip and Taylor Nominations Votes

Agriculture groups through Farmers for Free Trade call on the Senate to confirm two key agricultural trade officials in the Biden administration. The coalition sent a letter to Senate leaders Tuesday calling for the confirmation...

Latest articles

%d bloggers like this: