Tariffs put agri-food integration at risk

As a result of the 1994 trade agreement, the complementarity between the markets of Mexico and the United States represents a unique strength for both economies, since the first is a leader in fruit and vegetable and agroindustrial production, while the second stands out in grains and oilseeds, creating natural synergies in trade, so an imposition of tariffs as proposed by Donald Trump would damage food integration.

According to official data, Mexico, the United States, and Canada make up the strongest agri-food trade bloc in the world, with a food self-sufficiency index of 112 percent, that is, they produce 12 percent more than what the population demands. as a whole of the three nations.

At the same time, they make up one of the most integrated and complementary blocks in agri-food, especially in products such as corn, meat and dairy, generating commercial benefits for everyone.

According to calculations by the Agricultural Market Consulting Group (GCMA), almost 84 percent of Mexico’s agri-food exports are destined for the United States, the main market for these Mexican products.

Those products in which there is a surplus in terms of food self-sufficiency are exported, such as some from the fruit and vegetable sector, where the self-sufficiency index is 133 percent. For this reason, Mexico is an important exporter of avocado, lemon, mango and vegetables, among others.

In the agroindustrial sector, Mexico’s self-sufficiency index is 116 percent and it is the leading supplier of sugar and tequila to the United States.

On the other hand, Mexico has a deficit in the production of basic grains, oilseeds and some livestock products. In the first case, the self-sufficiency index is 44 percent, so large quantities of corn, wheat, soybeans and sorghum are imported from the United States, representing a market that annually exceeds 5 billion dollars.

In the livestock sector the self-sufficiency rate is 82 percent. Mexico imports pork, chicken and beef from the United States. This country is the main supplier of these products to Mexico, as well as others such as dairy products.

For Juan Carlos Anaya, general director of the GCMA, this integration and complementarity of agri-food markets generates mutual benefits for producers and consumers on both sides of the border, so the imposition of tariffs would have adverse effects, creating an imbalance in the food markets. the two nations.

Mexico would see its imports of basic grains, necessary to satisfy its internal demand, become more expensive, while the United States would lose a strategic market for its agricultural surpluses.warned the specialist.

Likewise, he highlighted that the existing logistics infrastructure between both countries offers exceptional competitive advantages, given that the network of railways and ports in the Gulf of Mexico allows significantly lower transportation costs compared to other trading partners such as the European Union or Asia.

The pandemic demonstrated the extraordinary resilience of the agri-food supply chains between both countries, evidencing the potential to further strengthen this trade integration.he concluded.