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Japan Edges Mexico for No. 1 Spot as U.S. Corn Buyer
With the Trump administration pursuing a renegotiation of NAFTA, Mexico is scaling back its purchases of U.S. corn, which has allowed Japan to become the top market for U.S. corn exports, said Bloomberg. Mexico has looked into corn imports from South America after President Trump made Mexico his chief NAFTA target and drove down the value of the peso.
Bloomberg said the decline in sales to Mexico, down 7% to $1.04 billion, through May was “a sign that trade tensions are pushing American grain toward other markets while its southern neighbor lines up new suppliers.” Japan has purchased $1.19 billion of U.S. corn so far in 2017, displacing Mexico as the top buyer, said the news agency, basing its figures on USDA data.
The National Corn Growers Association, a U.S. farm group, told Bloomberg that corn sales to Mexico were gaining momentum as the peso regains its value against the dollar. “Mexico is preparing a Plan B” in case of harsher trade relations with the U.S., said a NCGA official to Bloomberg. The news agency quoted former Agriculture Secretary Tom Vilsack as saying the Trump administration has become more conciliatory on agricultural trade as it realized the importance of farm exports.
Canada and Mexico are responsible for one third of U.S. agricultural trade. NAFTA talks could begin as early as mid-August.