The new agreements between the governments of the United States and Mexico, as well as the Mexican sugar industry, prevent dumping of Mexican sugar and corrects for subsidies the Mexican sugar industry receives. The agreement addresses the concerns of the U.S. sugar industry and prevents harm to other U.S. industries, including confectioners, beverage producers, and corn growers, that might have resulted if no agreement were reached.
U.S. grain associations spoke out in support of the new agreement, stating that it helps lay out positive groundwork for the modernization of the North American Free Trade Agreement.
“We are pleased to hear that U.S. and Mexican negotiators have reached a new sugar suspension agreement,” said Tom Sleight, president and chief executive officer of the U.S. Grains Council. “This milestone is an important one as we work to maintain our existing, robust trade of U.S. grains and related products while awaiting the beginning of NAFTA modernization negotiations.”
Sleight said Mexico is a “critical market” for the U.S. grains industry and it was the top export destination for corn last year and second largest buyer of U.S. distiller's dried grains with solubles (DDGS).
The National Grain and Feed Association (NGFA) applauded U.S. and Mexican negotiators for reaching an agreement in principle addressing U.S. imports of Mexican sugar, stating that once finalized it will help remove a significant trade irritant as all-important negotiations to modernize the NAFTA.
“This positive outcome shows what can be accomplished when trade negotiators engage in good faith discussions and share a mutual commitment to reach a successful outcome that preserves food and agricultural trade and enhances economic growth and job creation in North America,” said Randy Gordon, president of the NGFA. “In addition to preserving corn, corn products, meat and other U.S. food and agricultural trade with Mexico, Secretary Ross’s and Minister Guajardo’s success in reaching this agreement in principle is highly significant in creating a conducive, can-do environment as the United States, Canada and Mexico prepare to begin vitally important talks to modernize NAFTA.”
The Corn Refiners Association (CRA) that comprises Archer Daniels Midland Co., Cargill, Ingredion Inc. and Tate & Lyle Americas supported the protection of U.S. exports.
“This is a great day for American jobs,” said John Bode, president and CEO of the CRA. “In this administration’s first major negotiation with Mexico, Secretary Ross succeeded in protecting against unfair trade practices and maintained vulnerable export markets. With both sides demanding more, he coolly pursued the broader public interest. Thanks to his leadership, U.S. sugar interests have much stronger protections than the previous suspension agreements without threatening the $500 million in U.S. corn sweetener exports to Mexico that support 4,000 U.S. jobs.”
However, support was not seen within the U.S. sugar industry.
“Unfortunately, despite all of these gains, the U.S. sugar industry has said it is unable to support the new agreement, but we remain hopeful that further progress can be made during the drafting process,” U.S. Secretary of Commerce Wilbur Ross said in a statement on June 6. “We look forward to continuing discussions with them as we finalize the agreement. We remain confident that this deal defends American workers across many industries and is the best way to ensure stability and growth.”
The final draft of the agreement is expected in the next few days.