Agriculture trouble trifecta
The Federal Motor Carrier Safety Administration (FMCSA) has denied the joint application from the National Cattlemen’s Beef Association, Livestock Marketing Association, American Farm Bureau Federation, American Beekeeping Federation, American Honey Producers Association and National Aquaculture Association for an exemption from certain provisions in the hours-of-service (HOS) rules. The requested exemption was made on behalf of drivers who transport livestock, insects, and aquatic animals. The applicants requested approval for drivers, after 10 consecutive hours off duty, to drive through the 16th consecutive hour after coming on duty, and to drive a total of 15 hours during that 16-hour period.
Congress was pressured to intervene in the unresolved dispute between railroad unions and management. There are about ten pages of signors — mostly trade organizations representing livestock transportation companies and various aspects of agriculture — to a letter with respect to the unresolved dispute between railroad unions and management. The railroads market size value in 2022 is $281.24 billion with the revenue forecast in 2030 at more than $436 billion. A rail strike would cost producers and consumers about $2 billion daily, according to the Association of American Railroads.
In Mexico, President Andres Manuel Lopez Obrador’s 2020 decree to ban GMO corn imports by 2024 is taking shape. This comes after Agriculture Minister Victor Villalobos assured US Secretary of Agriculture Tom Vilsack about a year ago that Mexico would not limit US imports of GMO corn. Mexico is the world’s second largest importer of corn from the US, second to China. The majority of corn imported to Mexico is used for livestock feed.
According to Reuters, MAIZALL, an international chamber representing growers in Argentina, Brazil and the United States responsible for more than 80% of global corn exports, has said it will not change its corn production methods to non-GM to accommodate Mexico. They voiced skepticism that Mexico can find enough non-GM corn to meet its needs. Trade organizations representing US growers have urged lawmakers to dispute the ban under the USMCA, to avoid billions of dollars of damage to US and Mexico alike.
Suarez said he did not believe Mexico’s decree presented any violation of the USMCA, saying the country was “under no obligation to buy and grow GM corn,” saying the trade pact is “not God, nor is it our constitution.”
Sec. Tom Vilsack said this week in a statement that the phasing out of biotech corn and certain pesticides will result in massive economic losses to farmers in both countries and Mexican consumers will see drastically higher costs.
Vilsack said unless the issue is resolved, the U.S. Government would be forced to consider all options, including taking formal steps to enforce our legal rights under the USMCA.
“We made it abundantly clear that Mexico’s import ban would cause both massive economic losses for Mexico’s agricultural industries and citizens, as well as place an unjustified burden on U.S. farmers,” Vilsack said. “This is a critically important issue for U.S. farmers, who are rightfully and deeply concerned about the decree. The decree would also have significant impact on the U.S.-Mexico trade relationship, which hit a record value of more than $63 billion in two-way trade in 2021 and is expected to be even higher in 2022. The phase-out of biotechnology products, as outlined in the decree, could also stifle the important innovations we need to help our farmers adapt to a changing climate.”
During Suarez’s initiative, domestic corn production has increased only about 2% through incentivizing small and medium-sized growers with free fertilizers and irrigation expansions.
The USDA projects Mexican corn consumption reaching 44.7 million tonnes in 2022-23, up 300,000 tonnes from this year and nearly 1 million tonnes from 2020-21. Imports are forecast at 17.7 million tonnes in the upcoming marketing year, up 200,000 tonnes from 2021-22 and up 1.2 million tonnes from 2020-21. This year’s production is estimated at 27.6 tonnes. Mexico, thus far, has reported a 1 to 2% increase in domestic production since the beginning of Suarez’s initiative.