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US farmers praise the deal, while Mexico City minimizes the perceived negative effects on Mexican farmers

LOS ANGELES – 01/19/08 – January 1 marked the full implementation of the North American Free Trade Agreement and the elimination of Mexican trade barriers to a host of US agricultural exports including corn, beans, sugar, and milk.

But the development has drawn considerable protest from farmers across Mexico, who claim that the free entry of relatively cheap US exports would ruin millions of rural farmers for whom corn and beans – two staples of the Mexican diet – are subsistence crops.

In one protest earlier this week, about 100 Mexican farmers partially blocked the border crossing between El Paso and Ciudad Juarez despite assurances from Mexican Agriculture Secretary Alberto Cardenas, who told the media that 90% of the imports affected by the final barriers already entered the country free of tariffs in 2006.

The effect on local producers would be “minimal,” he said, adding that NAFTA benefits Mexico by allowing Mexican farm products into the US.

“We have become the principal supplier of fruits and vegetables into the United States,” Cardenas said in a news release, citing onions, avocados, mangoes, and watermelons as examples of successful Mexican exports.

According to the latest figures from the US Department of Agriculture (USDOA) and cited in the Los Angeles Times, the volume of US corn exports to Mexico has grown from less than 1 million metric tons in 1993 to 9.9 million metric tons in the 2006-07 marketing year, which ended in July.

”The majority of the imports are of yellow corn, which is used to feed livestock and to make corn syrup. There are about 1.5 million corn farmers in Mexico, and most grow white corn, which is used to make tortillas,” the agency said.

One of the US agriculture industry organizations praising the full implementation of the NAFTA is the Washington, DC-headquartered US Grains Council.

According to Ken Hobbie, the trade group’s president and CEO, the NAFTA’s agricultural agreement “promotes the total liberalization of agriculture and forestry in the region and is one of the most successful trade agreements in US history.”

He said NAFTA is not a new agreement and was actually enacted in 1994 with a phase out period of all duties over a 15-year period.

With the full implementation of NAFTA, Hobbie said, “this agreement is undoubtedly a huge success for US farmers, but also for livestock and poultry producers in Mexico.”

According to USDA’s Foreign Agricultural Service, since the NAFTA was implemented, two-way agricultural trade between the US and Mexico has grown from $5.9 billion to $24 billion.

Since 2005, the US has invested nearly $20 million in programs and technical exchanges to assist Mexico in addressing production, distribution and marketing- related challenges associated with the transition to free and open trade, according to a statement from Acting Agriculture Secretary Chuck Conner.

In the US, many sugar producers have voiced their opposition to the opening of the US market to Mexico-produced sugar.

However, according to industry officials, the surge of sugar into the US from south of the border that many predicted would flow across the border after January 1 has failed to materialize.

That’s because US tariffs on Mexican sugar were gradually scaled-back over the past several years in preparation for the January 1 deadline, said Jack Roney, director of economics and policy analysis for the American Sugar Alliance in Arlington, Virginia.

“One thing about the transition to free trade with Mexico, it hasn’t been a drop off the cliff,” Roney said.

In fact, the tariff on Mexican sugar was so low in 2007, “it offered no significant barriers to US sales,” according to Mark Duffin, executive director of the Idaho Sugar Beet Growers Association in Boise, Idaho.

Over the past few years, sugar has actually sold for a higher price in Mexico than in the US, while Mexico has to have a large enough crop before it can export any extra into the US, Duffin said, adding that “the trade situation will play out over the long term.”

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