It is bad news, but the outcome of the lawsuit was a foregone conclusion. The United States defeated the Mexican government in the panel on transgenic corn in the T-MEC. Our country has 45 days to modify its policy on the issue. It will no longer be able to prevent the use of its trading partner’s genetically modified grain in food production.
This is not an afterthought. The presence of GMOs in corn for human consumption in Mexico is a fact: at least a quarter of grains, seeds and flours contain the transgene.
For decades, U.S. farmers’ organizations and politicians have been asserting that U.S. farmers feed the world. The same is true of agribusiness consortiums. Monsanto, for example, warns that doing so is a moral imperative. And in an advertising brochure, the Cargill monopoly touts Somos itself as “We are the corn in your tortillas.”
For Washington, food is a powerful political weapon. Its international food aid programs, implemented over 67 years, allow it to support its allies in other nations, neutralize the influence of foreign enemies, open new markets, make deals with other trading partners and provide an outlet for the overproduction of its various agricultural products.
From the point of view of our northern neighbors, corn is a strategic crop. They are the largest producers of the grain in the world. According to the United States Department of Agriculture (USDA), the harvest in the 2024-2025 cycle will reach 385.7 million tons, which is approximately equivalent to one third of the grain’s production on the planet. In the 2023-24 cycle, that nation exported around 59 million tons, more or less a quarter of the world’s total foreign sales of the grain.
To achieve this supremacy, beyond its productive advantages, the government provides corn producers and large agribusiness companies with millions of dollars in subsidies. And, through export credit guarantee programs, it offers interest rates and loan access conditions that are more favorable than those offered by the market. Corn is the agricultural product to which most subsidies are granted: in 2019 it obtained 2.2 billion dollars.
Mexican imports of the U.S. grain reached a record level this year: 24.5 million tons, the largest annual volume sent by that nation to a single destination and about 40 percent of its total exports of the cereal. In 2023, these sales reached a whopping 5.386 billion dollars.
For half a century, the United States was a vigorous agricultural powerhouse, with a sustained agricultural trade surplus. However, that trend began to change in 2019, when it imported more than it exported. Between that year and 2024, the deterioration worsened. In 2023, the negative balance was $17 billion and in 2024 it will probably reach $31 billion.
The arrival of Donald Trump to the presidency, his project to relocate the productive base within the United States, his threats to impose tariffs left and right, the approval of a reciprocal trade law to prioritize U.S. producers over foreign supplies, the promise to deport 20 million undocumented immigrants (many of them agricultural workers), the renegotiation of the T-MEC, the announced deregulation of the agricultural industry and the probable trade war with China (the largest importer of raw materials in the world) will have consequences on world trade in food and corn in particular.
In fact, the Asian giant has already taken preventive measures in the face of the coming storm. After China significantly increased its corn purchases from the United States between 2021 and 2022, acquiring between 17 and 18 million tons per year, in 2023 it drastically reduced its purchases to 5.6 million tons. Moreover, between January and May 2024, the trend continued to decline: it purchased only 1.82 million tons from our neighbor, a 77 percent decrease compared to those reported in the same period of last year.
In recent years, the Asian country has covered its cereal needs by increasing its own harvests. In 2023, its production reached a record: more than 288 million tons. Also, in that year, it bought 8 million 790 thousand tons from Brazil, thus becoming the main grain supplier to the Asian giant. In fact, the increase in Brazilian production and exports has become a real threat to Uncle Sam.
In short: food is a political weapon of the United States. Its agricultural balance is increasingly in deficit. It is the most important producer, consumer and exporter of corn in the world, with the Brazilians close on its heels. Corn is the backbone of its agricultural-industrial chain. It exports between 10 and 20 percent of its harvests. This cycle will increase its production. The large food consortiums have significant political power in that nation. Corn growers’ associations have significant lobbying capacity. China has increased its domestic production and Brazil is already its main external supplier. A not unlikely new tariff war will cause the Asian giant’s grain purchases from the U.S. to decline even further. Mexico is importing more and more grain from its neighbor.
All these elements together announce that, the Trump administration will not for any reason, allow the access of gringo corn (overwhelmingly GMO) to Mexican markets to be closed or restricted. It cannot afford to lose that business. That will be reflected in the renegotiation of the T-MEC. Thus, the sum of the pressures for its grain to be sold without obstacles in national territory, together with undocumented migration, the sale of fentanyl and the relocation of certain industries to the United States, foreshadow stormy times and a drastic change in the binational relationship. The deck is stacked.
Original text by Luis Hernández Navarro published in La Jornada on December 24th, 2024.
Translation by Schools for Chiapas.
The Collapse of Food Self-Sufficiency in Corn
The crisis in corn production in Mexico this 2024 highlights the fragility of food procurement in an environment of climate crisis.
Only 23.4 million tons of the grain are expected to be produced this year, from the 27 or 28 million harvested per year since 2016. This drop occurs at the end of the six-year term that set out to achieve food self-sufficiency and is the result of the dismantling of agricultural policies and financing and marketing institutions that sustained production that competes in the open market with that of the United States.
Commercial farmers who plant with irrigation in the autumn-winter cycle, and produce around 8.8 million tons, were the most affected. The few programs maintained by the government of Andrés Manuel López Obrador left out those who have more than five irrigated hectares. Thus, 84 percent of corn production did not receive any subsidy.
Sinaloa contributes about 74 percent of the autumn-winter cycle, and 24 percent nationally. Its white, hybrid and non-GMO corn is mainly destined to feed people in the cities.
The elimination of subsidies for irrigated farming caused production to decline starting in 2019, but in 2023 it rebounded encouraged by good international prices.
The government, more interested in lowering food prices than in ensuring the country’s food security, promoted corn imports through the Opening Agreement against Inflation and Famine, signed in October 2022. Fifteen transnational companies were able to import corn without regulations or tariffs, even from countries with which Mexico does not have trade agreements.
In 2023, grain imports reached a record 19.8 million tons. As in 1996, the government proceeded to dump corn against producers by flooding the domestic market with grain imported from Brazil (1.8 million tons) and South Africa (259,000 tons).
Sinaloa’s corn growers had enormous difficulties in marketing their production: the market price of 5,625 pesos per ton was far below the 7,000 pesos they demanded to cover production costs and make a profit. The government decided not to grant a mark-up for a target income, but to pay the full 7,000 pesos as a guarantee price, only for the purchase of one million tons to those who had less than 10 hectares.
In response to this marketing scheme and the lack of solutions from the government, the farmers took over the highway toll booths, the streets around the government palace, the Pemex plants in Topolobampo, Guamúchil and Culiacán; they also paralyzed the Culiacán airport for several days. They held meetings with the governor and in Mexico City they tried, unsuccessfully, to be received by the president.
Although they were able to increase the volume of production that Segalmex would include in the guarantee price, and the participation of the state government, they were unable to cover the entire crop. Marketing difficulties delayed payments and several fell into arrears. Arrest warrants for sabotage were issued against leaders of farmers’ organizations and some were imprisoned.
The mistreatment they suffered, the lack of profitability of production and of resources for investment, along with the scarcity of water in the dams, caused the fall in production for the fall-winter 2024 cycle by 4 million tons.
Producers mobilized again to market 4.9 million tons harvested in 2024. With the presidential elections looming, the government activated the arrest warrants against the leaders and agreed to a support of 950 pesos per ton.
Production in the spring-summer cycle, which has had higher subsidies, also reduced its volume in 2023 and 2024 by almost one million tons compared to 2022.
As of September 2024, corn imports registered 18 million tons, 3.4 million more than at the same date of the previous year, so it is possible that the year will end with imports of around 23.1 million tons.
The dramatic reduction in corn production was not caused by a cyclical situation, but by the lack of agricultural policies. The profitability of its cultivation is in question and the decapitalization of commercial farmers is a reality. Meanwhile, the country’s food dependence is increasing.
* Director of the Centro de Estudios para el Cambio en el Campo Mexicano (Center for Studies for Change in the Mexican Countryside)
Original text by Ana de Ita* published in La Jornada on December 23rd, 2024 .
Translation by Schools for Chiapas.