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USDA, trade officials can't explain Trump's promise of Mexican ag purchases



Two of the Trump administration’s top agricultural trade officials told Congress on Tuesday they didn’t have details of any agreement with Mexico to buy more U.S. farm goods that President Donald Trump had promised over the weekend.


Trump tweeted Saturday that “Mexico has agreed to immediately begin buying large quantities of agricultural product from our great patriot farmers!” Mexican officials indicated they had made no such commitment and some suggested instead that agricultural trade might increase naturally without tariffs in the way and if the new NAFTA deal is ratified.


During a House Agriculture Committee hearing today, Rep. Angie Craig (D-Minn.) asked top officials from the Agriculture Department and Office of the U.S. Trade Representative if they could clarify which farm products and how much Mexico would potentially be purchasing.


“I don’t have any details to that regard,” said Gregg Doud, USTR’s chief agricultural negotiator.


USDA Undersecretary Ted McKinney also said he didn’t have any information either but “we’ve got things in line if they are serious about wanting to make some immediate purchases. So we’re always ready to deal, but we have to get clarification first.”


Craig said it “seems odd that the president has made this announcement and has yet to tell” his agriculture and trade officials. “So is the president promising additional purchases without that being true, or has [USDA and USTR] just not been told yet what the president is promising?” she asked.



McKinney suggested Trump was referring to “reinvigorated” trade after the U.S. and Mexico reached a deal to avert new 5 percent tariffs Trump had threatened to impose on all Mexican goods.


“We do anticipate exactly what the president said in terms of restored, new, reinvigorated sales to Mexico,” he said. “But if you’re asking for a specific crop or livestock or poultry product, I don’t have that at this point, ma’am.”


Trump has said he will announce “at the appropriate time” further details about the tariffs agreement with Mexico.


Trump’s threats to use tariffs to get his way on non-trade issues like immigration may weaken congressional support for Congress to pass the U.S.-Mexico-Canada Agreement. House Democrats are already balking at key provisions of the USMCA, delaying its consideration in Congress.

Ken Smith Ramos, a former Mexican official who was the country’s chief trade negotiator on the new U.S.-Mexico-Canada Agreement, told POLITICO this weekend that Trump’s tweet was “a bit strange,” because under NAFTA there already are no tariffs on nearly all agricultural products between the United States and Mexico.


The Mexican government could, however, increase demand for one particular U.S. farm product — corn — by as much as $2 billion annually if it were to expand use of ethanol-blend gasoline into Mexico City, Guadalajara and Monterrey, where it is currently prohibited, according to Smith Ramos. Smith Ramos said a technical regulation is already under consideration to make the change and that it would “create a huge market for ethanol” in Mexico.



Article originally published on POLITICO Magazine