This article appeared in Spanish in La Jornada del Campo on September 5 as part of a 10-article opinion section on the ongoing trade dispute between the U.S. and Mexico over Mexico's policies restricting genetically modified corn and glyphosate.
Ever since Mexican President Andrés Manuel López Obrador issued his initial 2020 decree restricting genetically modified (GM) corn and glyphosate imports and uses, U.S. commodity and agribusiness groups have been sounding alarms about the economic damages the measures would cause. The alarms kept ringing even after a series of productive negotiations resulted in a new decree in February 2023 that reduced the immediate restrictions on GM corn, postponing any action on GM feed corn imports and restricting only the use of GM corn in the tortilla-masa food chain.
No matter. U.S. Trade Representative Katherine Tai, in announcing the call for formal consultations under the U.S.-Mexico-Canada Agreement (USMCA) March 6, asserted, “Mexico’s policies threaten to disrupt billions of dollars in agricultural trade.”
There is no credible evidence to support that claim, which is based on flawed and now outdated industry-funded economic studies. The main source of disinformation was a September 2022 economic modeling study from consulting firm World Perspectives, Inc. (WPI), which claimed to show catastrophic impacts on U.S. and Canadian farmers and on Mexico’s own food security. It projected massive price spikes, market chaos and billions of dollars of lost output for U.S. corn farmers. Mexico would see its economic output fall by $19.39 billion, with an annual loss of 56,958 jobs, reducing labor income by $2.99 billion.
The economic study presented itself as coming from a “coalition of leading food and agriculture industry stakeholders,” but the project was commissioned by CropLife, the biotechnology industry trade association, and other agribusiness interests in the U.S. and Mexico. All have strong economic interests in opposing Mexico’s GM corn restrictions.
The exaggerated claims of economic damage sprang from a convenient set of assumptions, all of which are flawed and now outdated in light of the more recent presidential decree.
Modelers assumed an abrupt shutdown of all GM corn imports in 2024, with no warning or economic adjustments. The 2020 decree gave three years notice of the change, so the measures were hardly unannounced. In any case, Mexico’s revised decree is explicit that it now applies only to GM corn used in tortillas and corn-dough, which is supplied overwhelmingly by Mexican producers of white and native corn varieties. Only 4% of U.S. corn exports are white corn, and most of that does not go into tortillas.
In fact, WPI includes in the back of its study a more realistic scenario in which feed corn is not included in the restrictions. Under such conditions, “the market adjusts relatively quickly and the large shifts in farm trends and the grain handling industry are not predicted.”
One of the more prevalent and flawed assumptions is that U.S. farmers cannot and will not grow non-GM corn if Mexico demands it. That is absurd. Before GM corn took over the market in the mid-1990s, the U.S. was the world leader in non-GM corn production and exports. U.S. farmers still grow non-GM corn. In fact, in 2020 they planted an estimated 7.5 million acres of non-GM corn. Even some growers of GM corn think the U.S. government is going too far in forcing Mexico to accept GMOs. According to reports, many farmers would be happy to produce non-GM corn for Mexico and can do so if given time to prepare. They are being given that time, and markets will adjust to any new demand in Mexico for non-GM corn.
And they could do so efficiently. WPI researchers assume GM corn has a 7-10% yield advantage over non-GM corn, even though field trials have shown comparable yields. Other studies have inflated their estimates of economic damage by assuming a 35% drop in yields, an absurd extrapolation from a narrow and flawed study of organic agriculture.
They also ignore Mexico’s concerted effort to increase domestic corn production to reduce import-dependence. WPI assumes no increase in corn production and no decrease in Mexico’s need for U.S. imports. In fact, they assert that Mexico’s promotion of agroecological practices will reduce corn yields by 31% despite evidence that such programs are raising yields for many farmers.
Taken together, these flawed assumptions in the industry-funded assessment of Mexico’s GM corn restrictions generate inflated estimates of high costs and lost output in the U.S. and severe food insecurity in Mexico. Nearly all of the projected damage evaporates when exposed to the open air of economic and political reality.
As a recent letter from U.S.-based FarmAction to U.S. government officials made clear, alarmist reports and trade threats only prevent markets from adjusting to rising demand from Mexico for non-GM corn. Most economic costs can be easily avoided if markets get the clear signals they need to adjust. That would also give U.S. consumers something polls say they have wanted for years: a wider selection of non-GM foods.