Report Trumps Renegotiation of NAFTA Could Skunk Your Corona
Report
Trumps Renegotiation of NAFTA Could Skunk Your Corona
http://foreignpolicy.com/2017/05/22/trumps-renegotiation-of-nafta-could-skunk-your-corona/
Trouble brews for Mexican beer as uncertainty over trade policies threatens U.S. exports of two key ingredients
By Jessica Holzer
May 22, 2017
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Mexican beer may be brewed and bottled south of the border, but the key ingredients the hops and the barley come mostly from the northern United States...............................
That win-win relationship is now at risk with clouds hanging over the North American Free Trade Agreement. Farmers are worried that the Trump administrations tough stance on Mexico will rupture their long-nurtured trade relationship with Americas southern neighbor, and give Canadian and European growers an advantage in what has long been a privileged American market.
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The high-altitude region of eastern Idaho where Browns 10,000-acre farm sits has a short growing season. If barley sales dried up, his only other option would be wheat, and the switch would be costly. This is barley country. You cant grow much else, he said.
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Mexico is the biggest market for U.S. barley growers, and the second-biggest market for hops producers. U.S. farmers supplied nearly three-quarters of the $265 million in barley and malt, and the $37 million in hops, imported by Mexico and largely used for beer production last year, according to the U.S. Department of Agriculture.
Thats largely due to NAFTA, which gives U.S. exports tariff-free access to Mexico.
Under NAFTA, its the same for a barley producer from Idaho to ship its grain to Monterrey as it is to Milwaukee, Javier Chavez, a marketing specialist at the U.S. Grains Council in Mexico, said. By contrast, European barley growers face quotas and a tariff system that could be changed anytime a politician finds it suitable to protect Mexicos market.
But that access is now up in the air. Canada, Mexico and the United States are set to begin talks to renegotiate NAFTA as soon as August......................
In 2005, Grupo Modelo, the maker of Corona and Modelo, built a $60 million plant in Idaho Falls, Idaho for malting barley for the Mexican beer industry. .........................
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