US wins Mexico GM corn dispute case as panel finds curbs not science-based

By David Lawder

WASHINGTON (Reuters) -A trade-dispute panel dominated on Friday that Mexico’s restrictions on U.S. genetically modified corn exports violate the U.S.-Mexico-Canada Settlement, handing the Biden administration a serious commerce victory in its remaining weeks.

The U.S. Commerce Consultant’s workplace mentioned the USMCA dispute settlement panel dominated in favor of all seven U.S. authorized claims within the long-running case. It mentioned the panel discovered Mexico’s restrictions are usually not based mostly on science and violate the USMCA’s chapters on sanitary and phytosanitary measures and on market entry and nationwide therapy.

The three-member panel’s remaining report beneficial that Mexico deliver its corn-trade insurance policies into compliance with the commerce settlement. It has 45 days to take action beneath the 2020 commerce deal’s guidelines and failure to conform may lead to punitive duties on some exports to the U.S.

Mexico’s economic system and agriculture ministries mentioned in a joint assertion they disagreed with the ruling however would respect it, offering no particulars on what steps they might take.

“The Authorities of Mexico doesn’t agree with the Panel’s resolution, because it considers that the measures in query are aligned with the rules of public well being safety and the rights of Indigenous peoples,” the businesses mentioned.

Nonetheless, they mentioned that dispute decision was a key part of the USMCA commerce deal, noting that Mexico and Canada prevailed over the U.S. in an automotive guidelines of origin dispute case final yr.

The corn dispute started six months after USMCA got here into drive in July 2020 when then-President Andres Manuel Lopez Obrador decreed that GM corn be banned by the top of 2024 — a transfer largely concentrating on U.S. corn exports. His successor, President Claudia Sheinbaum, has supported the coverage.

After years of little motion in consultations, USTR requested arbitration to settle the dispute, difficult Mexico’s 2023 decree that instantly banned use of GM corn in tortillas and dough, and instructed authorities businesses to progressively eradicate its use in different meals and in animal feed.

The U.S. argued the Mexican authorities’s claims that GM corn is dangerous to human well being weren’t based mostly on science.

“The panel’s ruling reaffirms the USA’ longstanding issues about Mexico’s biotechnology insurance policies and their detrimental impression on U.S. agricultural exports, U.S. Commerce Consultant Katherine Tai mentioned in a press release.

U.S. Agriculture Secretary Tom Vilsack mentioned the choice ensured that U.S. farmers and exporters “will proceed to have full and honest entry to the Mexican market.”

“It’s also a victory for the international locations around the globe rising and utilizing merchandise of agricultural biotechnology to feed their rising populations and adapt to a altering planet,” Vilsack added.

In February, Mexico’s authorities softened its preliminary ban on GM corn, explicitly permitting its use for livestock feed and industrialized merchandise for human consumption, however maintained the ban to be used in tortillas.

Mexican officers have defended restrictions on GM corn in tortillas and argued it’s as much as Washington to display its exports don’t hurt human well being.

U.S. President-elect Donald Trump has threatened to impose a 25% blanket tariff on all imports from Canada and Mexico when he takes workplace on Jan. 20 except they stem the circulate of unlawful migrants and fentanyl to the U.S.

If applied, these duties would seem to violate the USMCA’s guidelines, probably spawning one other dispute case.

TOP BUYER

Mexico, birthplace of contemporary corn, prohibits planting of GM corn on account of fears it will contaminate native strains of the grain. But the nation is the highest international purchaser of U.S.-grown yellow corn, practically all of which is genetically modified.

Mexico’s authorities expects native patrons will import a file 22.3 million metric tons through the 2023/24 agricultural season.

In 2024 by way of October, the U.S. exported $4.8 billion value of corn to Mexico, based on U.S. Census Bureau knowledge.

Mexico boasts over 60 native forms of corn, generally known as landraces, many coming in a kaleidoscope of colours and that includes distinct taste profiles.

This month, Deputy Financial system Minister Luis Rosendo Gutierrez confused that the federal government was doing all the pieces it may to guard the free commerce pact amid Trump’s tariff threats. He added Mexico would adjust to the panel’s ruling.

U.S. and worldwide agriculture and biotechnology teams applauded the ruling.

“That is the clearest of indicators that upholding free-trade agreements delivers the steadiness wanted for innovation to flourish and to anchor our meals safety,” mentioned Emily Rees, president of CropLife Worldwide, which represents the plant science trade.