With a corn-state senator demanding speedy action, U.S. trade representative Katherine Tai said on Thursday that she would not allow a dispute with Mexico over genetically modified corn “to go on indefinitely.”
A 30-day period for technical consultations between the nations, arguably the last chance to avert a USMCA trade complaint, expires on April 7.
Mexico, the No. 1 market for U.S. corn exports, banned imports of genetically modified white corn for making tortillas last month while accepting imports of GMO yellow corn intended for livestock feed and industrial processors.
The United States responded on March 6 by asking for consultations under USMCA rules for Mexico to provide scientific justification of its biotechnology policy.
“There is only one option, and on April 7 — that’s after 30 days — I would expect you to file a formal dispute settlement. Are you going to do that?” asked Iowa’s Chuck Grassley at a Senate Finance Committee hearing on the Biden administration’s trade agenda. “We’ve been talking for two years.”
“You’re absolutely right, we have those tools for a reason, and I assure you, it is not my intention to allow this to go on indefinitely,” replied Tai, after offering to keep Grassley informed on steps in the negotiations. In her written testimony, Tai said that if technical consultations fail, “we will consider all options to fix this problem, including by taking additional steps under the USMCA.”
U.S. farm groups have called on the administration to dismantle trade barriers to selling corn to Mexico. If the administration files a USMCA trade complaint, a panel of trade experts would be appointed to resolve the dispute. The
United States is the world’s largest corn grower and a fierce defender of the safety of genetically modified commodities. The lion’s share of U.S. corn is grown from GMO seeds.
Finance Committee chair Ron Wyden, an Oregon Democrat, and Sen. Michael Crapo of Idaho, the senior Republican on the panel, prodded the administration about being more assertive in attacking trade barriers worldwide and about pursuing new trade agreements.
“The United States of America has to play offense on international trade,” said Wyden.
Before any agreements are signed under the Indo-Pacific Economic Framework, the administration must clear away several unresolved agricultural trade dispute, said Crapo.
“You’re right, trade liberalization, tariff reductions, are not part of this negotiation,” said Tai. “Again, the agricultural barriers, the interests of our farmers, ranchers, agricultural producers, are a top-line priority for our trade agenda, and I will be looking for opportunities to fix these problems in any context I can.”
“I don’t think I got the commitment I wanted, but we will continue this discussion,” said Crapo.
Democratic Sen. Maria Cantwell said India has shut off the market for Washington State apples. “The retaliatory tariff environment is hurting our farmers,” she said. Sen. Mark Warner, a Virginia Democrat, before complaining about high poultry tariffs in India, greeted Tai by saying, “Let’s talk turkey.”
South Dakota’s John Thune, No. 2 in Senate Republican leadership, called for negotiations toward a free trade agreement with Britain. “I remain open-minded,” responded Tai.
The U.S. agricultural attaché in Mexico said corn imports, which set a record last year, would decline by 4% this marketing year.
“The restriction on GE corn use is expected to impact white corn imports into Mexico, used primarily in the tortilla industry,” said the attaché in an annual grain and feed report. Imports would rise by 500,000 tonnes, to 17.9 million tonnes, in the 2023/24 marketing year, she said. Attaché reports are not official USDA data.
To watch a video of the hearing or to read statements by Tai, Wyden, and Crapo, click here.