Source: DW

Mexico is now looking to acquire its corn supply from elsewhere as a way to call President Trump’s anti-NAFTA bluff.

US President Donald Trump threatened to upend the existing free trade agreements of the country, but it did not stop Mexico from ensuring that it is protected some way or another.

To safeguard Mexico’s national interests, deputy Economy Minister of Mexico, Juan Carlos Baker, confirmed to Financial Times that his country had talks with Brazil and Argentina over the weekend. The talks were intended to create a duty-free relationship for all corn imports.

As of now, Mexico is getting almost all of its corn supply from the US. As soon as the arrangements materialize, US farmers - who are the very people Pres. Trump claims that he’s protecting from a bad trade deal - will be terribly affected.

Corn shipments from the US to Mexico amount to at least $2.5 billion worth of business for the farmers in the US. These farmers have enjoyed a duty-free, lucrative relationship with southern neighbors because of NAFTA’s adoption since 1994.

Because of Pres. Trump’s aggressive trade policies, the future of this wonderful cross-border relationship hangs in balance. Donald Trump became President because he promised to renegotiate NAFTA. According to him, NAFTA is the worst trading deal that has been signed. He may claim that the trade deal is not advantageous to US farmers, but he does not have any solution that will prove to be beneficial to the country. In fact, it will be worse for US farmers and better for other countries.

In the corn market, Brazil is US’s biggest competitor. Brazil produced at least 90 million tons of grain, and it exported 30 million tons in 2016. As for Argentina, it produced not less than 35 million tons and almost all of its grain was exported. Still, experts from agricultural groups think that Mexico will have a hard time in turning to other nations for its corn supply.

Source: CNN

Each year, the United States exports grain of at least 110 million metric tons. Nearly half of the figure is corn. Spokesman of Corn Growers Association of the US, Mark Lambert, said that they are trying to hold their tongues just to make sure they don’t respond to something that’s largely rhetoric.
“If this catastrophe pushes through, then it will certainly be bad news for us,” said Lambert.

US Grains Council and Corn Growers Association have raised concerns about Trump administration’s desire to alter NAFTA. Both organizations are demanding Pres. Trump to just back off because if he does not, rural dwelling farmers will be hurt badly. The saddest part about this issue is that the farmers who are on the line are the ones that ushered Trump into office.

Economic Minister of Mexico told FT that the talks with other nations were ‘pretty far advanced.’ He said that even if Argentina is lagging behind, he will find a way to correct it. Baker is scheduled to fly to Argentina in a couple of months.