MEXICO- The Mexican government said it would counter U.S. arguments over agriculture biotech measures, including plans to limit its use of genetically modified (GM) corn, in trade dispute settlement consultations on Friday.
The consultation was requested by Washington as the two countries inch toward a full-blown trade dispute under the U.S.-Mexico-Canada Agreement (USMCA) over Mexico’s policies to limit the use of GM corn, usually imported from the U.S.
Mexico buys about 17 million tonnes of mostly GM yellow corn from the U.S. annually, worth nearly US$5 billion, most of which goes to animal feed.
Mexico and the U.S. have been at odds since President Andres Manuel Lopez Obrador published a decree in late 2020 that appeared to ban all GM corn imports, a multibillion-dollar trade between the two counties.
However, in February, Mexico discarded a deadline to ban genetically modified (GM) corn for animal feed and industrial use amid trade tensions with the U.S. but retained plans to prohibit the use of the grain for human consumption and the herbicide glyphosate.
Mexico felt its cautionary approach was valid for white corn, mostly used in tortilla production, because tortillas are one of the country’s staple food.
The US had argued that the reasoning behind Mexico’s ban on GM corn was overreactive and was putting billions of dollars worth of trade for no good reason.
“While we appreciate the sustained, active engagement with our Mexican counterparts at all levels of government, we remain firm in our view that Mexico’s current biotechnology trajectory is not grounded in science, which is the foundation of USMCA,” Agriculture Secretary Tom Vilsack had said earlier this year.
US Trade Representative Katherine Tai then requested technical talks with Mexico to pacify the dispute, based on the Sanitary and Phytosanitary Measures (SPS) Chapter of the USMCA.
Technical consultations are usually the first step toward a dispute resolution panel under the USMCA, which could ultimately lead to retaliatory tariffs.
Mexico holds that issue will not escalate
In an interview with the Mexican newspaper Milenio, Mexican Agriculture Minister Victor Villalobos said the issue would not escalate.
According to the stipulations by the USMCA, if the consultations fail to resolve disagreements within 75 days, Washington can request a dispute settlement panel to decide the case.
However, Mexico said it was committed to “constructive dialogue” regarding U.S. concerns and to “reach a mutually satisfactory agreement.”
While the technical consultations are yet to yield the expected results, Mexico is confident that the trade dispute settlement consultations will find that the ban will not affect the trade volumes between the two countries, seeing that Mexico already produces a lot of white maize for tortilla production.
Mexico argued on Friday that the decree “encourages Mexico to preserve planting with native seeds, which is done in compliance with the USMCA’s environmental regulations.”
According to some sector experts, the move could set a precedent among other countries, thus potentially disrupting the global corn trade.
The U.S. Department of Agriculture and the office of the U.S. Trade Representative have not commented.