Feature: NAFTA makes small Mexican maize producers nervous

Source: Xinhua| 2017-08-19 12:27:46|Editor: Xiang Bo
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by Luis Rojas and Wu Hao

MEXICO CITY, Aug. 18 (Xinhua) -- Mexican maize producers are worried about the future as Mexico, the United States and Canada are in the midst of renegotiating the emblematic North American Free Trade Agreement (NAFTA).

Pedro Baranda, a 52-year-old small maize producer near Mexico City, is highly pessimistic. "The countryside will disappear," he said.

He says that NAFTA has not brought him any benefits. The negotiation, he believes, might kill off Mexico's suffering agricultural sector.

"The priority is being given to other things like industry, which make more money," said Baranda in an interview with Xinhua. "The free-trade agreement will benefit (large) producers, not the farmers."

For the farmer, maize is traditionally reckoned as a "seed from which generation after generation has survived." However, he now sows maize across 7,000 square meters from which he produces a ton harvest a year, bringing him a revenue of 8,000 pesos (450 U.S. dollars), on which five people live.

However, imports of U.S. maize into Mexico during 2016 stood at 13.8 million tons, according to official figures.

Baranda said farmers are well-paid in the United States, adding that the sector receives government support and planning, which does not happen in Mexico.

He was joined by Efrain Rodriguez, a Mexican miller, who told Xinhua that the increasing arrival of foreign maize into Mexico is cutting out local producers, due to its low cost and high volume.

Rodriguez said the price difference between local and imported maize can be between 4 to 5 pesos (less than 30 U.S. cents), enough to make a difference for lower-income families.

Rodriguez complained that an increase in imported maize leaves him with reduced income.

In comparison, Mexico's largest maize flour company, Gruma, reported a sales volume of 1 million tons in the second quarter of 2017. This marked a 3 percent hike year-on-year, in large part due to the U.S. market.

In July, the agricultural ministers of Mexico and the United States met ahead of the NAFTA talks and agreed to create a joint mechanism to increase trade in agricultural produce.

The trade of foodstuffs between the two sides has grown at an annual average of 8.5 percent since NAFTA took effect.

Pedro Tuesta, a Latin American economist for 4Cast Roubini Global Economics, said that "when there is a rise in trade, it is well-known that those who can produce more will benefit the most. It is a question of productivity."

According to the Food and Agriculture Organization of the United Nations, Mexico produced a record of 27.6 million tons of maize in 2016, still far from the 343 million tons in the United States.

A study by the Carnegie Endowment for International Peace, the first eight years of NAFTA created 500,000 manufacturing jobs in Mexico but saw 1.3 million agricultural jobs vanished.

Laura Amezcua, head of the International Business School at Mexico's Panamerican University, said that "the problems have outweighed the benefits." Enditem