Mexico's GMO Corn Import Ban: Implications and U.S. Response

On November 28, the United States issued a warning to Mexico considering its plan to ban genetically modified (GMO) corn imports in 2024. This potential import ban could have significant repercussions for both economies and could potentially trigger legal action under the USMCA (United States-Mexico-Canada Agreement).

The U.S. Position

U.S. Secretary of Agriculture, Tom Vilsack, met with Mexican President, Andrés Manuel López Obrador, and issued a statement warning that the Mexican phase-out decree could disrupt trade and harm farmers on both sides of the border, as well as increase costs for Mexican consumers. Vilsack emphasized that the U.S. government would consider all options, including legal recourse, if a resolution is not reached.

Background on the Ban

Mexico's President issued a presidential decree on January 1, 2021, which aims to ban GMO corn and phase out the herbicide glyphosate by 2024. Mexico imports about 17 million tonnes of GMO corn annually, with the United States being its primary supplier. Over 90% of corn planted in the U.S. is genetically modified, making this ban a matter of significant economic concern.

Impacts on U.S. Farmers and Consumers

A recent study by World Perspectives Inc. indicates that such a ban would have devastating economic consequences. The U.S. corn industry would lose approximately $3.56 billion in the first year following the ban, with a further $5.56 billion loss in the second year. Over a 10-year period, the industry would incur an economic loss of $13.61 billion. Additionally, the U.S. corn wet milling industry would suffer $7.65 billion in losses, while the ethanol industry would incur a loss of $521.5 million, accounting for gains from lower GM corn prices.

Mexico's Food Security and Biotechnology Safety

During the meeting, some progress was noted as López Obrador reaffirmed the importance of yellow corn imports for Mexico's food security. However, the U.S. expressed concerns that the ban would place an unjustified burden on farmers. Vilsack indicated that the U.S. expects a proposal from the Mexican team soon, which will be carefully evaluated.

Future Outlook and Dialogue

Both parties highlighted the need for ongoing dialogue and information exchange to ensure the safety of biotechnology products. The U.S. emphasizes the importance of maintaining trade relations, citing the potential economic losses for both countries. As negotiations continue, the outcome will likely shape both agricultural policies and trade relationships in the region.