As neighbors and long time trading partners, the United States and Mexico have historic economic ties that are hard to break. Mexico is the U.S.'s third-largest trading partner, with both countries demonstrating strong economic interdependence. However, agriculture could suffer major repercussions if President Donald Trump's administration follows through on its plans of increasing border taxes and renegotiating the North American Free Trade Agreement.
Both countries have relied on one another to supply the goods that they cannot produce year-long. Two products that could possibly be affected by these increased trade tensions are avocado imports from Mexico and corn exports from the U.S.
According to the US Department of Agriculture, the U.S. is the largest corn producer and exporter in the world. Even though Mexico produces its own corn, it still relies on American corn to supply the demand of this staple crop in Mexicans' diet and livestock industry. The International Grains Council estimates that Mexico will import 13.6 million tons of maize in the 2016-17 cycle. Which is unsurprising considering Mexicans consumed 33.6 million tons of corn in 2014. U.S. corn farmers depend on Mexico as a consumer because as reported by the U.S. Grain Council, Mexico is the United States' second largest and growing importer.
In response to Trump's anti-immigration rhetoric, Mexican State Senator Armando Ríos Píter has proposed for his government to stop importing corn from the U.S.
"We can buy that corn from Australia, we can buy that corn from Canada, we can buy that corn from Brazil," said Ríos Píter in a Spanish interview translated into English.
While the proposal has yet to be approved and its effects are relatively unclear, the response from U.S. growers has emphasized the importance of their trade relationship with Mexico.
"Mexico is our top corn market overseas," said the National Corn Association in a statement, "NAFTA has led to significant growth in the Mexican feed and livestock sectors and integration between US and Mexican agriculture."
Corn is not the only crop that could be caught in the crossfires of this diplomatic row. Ramón Paz, President the Association of Producers and Distributors of Avocados of Mexico, a lobby group for the avocado industry, says he is concerned about the anti-Mexican and anti-commerce discourse expressed by Trump's administration.
APEAM explains that avocado trade is a fairly young market between Mexico and the U.S., yet of every 10 imported avocados to the U.S., nine come from Mexico.
"Customs duty will change the structure of the costs and will affect the sale price to [American] consumers," said Paz in a Spanish interview translated into English. Paz dismissed the idea that exports hurt internal growth.
"Mexican avocados created 19,000 American jobs that had a reimbursement of 1.2 billion [dollars]," Paz added. "This value chain pays more than 600 million dollars in taxes to the United States."
Mexican avocado traders are developing alternative strategies in the case that relations with the U.S. hurt their industry. Paz explained how they plan to expand their relations with China, which is still a small yet growing market. They are hoping also to continue ongoing trade with Japan, Canada, Europe, and Central and South America.
Though there have not been any clear changes today in agricultural relations between the two nations, the future of the avocado and corn industries remain unclear as manufacturers, farmers and distributors reimagine what the future may look like during an era of protectionist American commerce.
Contact reporter Claudia Buccio here and follow her at @zualc_cpb.