NCGA Applauds WTO Ruling in Mexico HFCS Case (3-7-06)

The National Corn Growers Association is pleased with a World Trade Organization (WTO) ruling this week that reconfirmed the violation of international commitments by Mexico when it placed a tax on beverages containing high fructose corn syrup (HFCS).

“Corn growers are very pleased with the decision,” said Bob Bowman, NCGA Joint Trade Policy A-Team chairman. “We have worked long and hard to regain this important market for corn products. This was a huge market loss for the corn industry – more than $4 billion. Fair and balanced market access is a benefit to all sides involved. Without the tax, U.S.-produced HFCS can now compete on a more level playing field.”

According to the Corn Refiners Association, the 20 percent tax, enacted by the Mexican Congress in January 2002, has shut down U.S.-owned sales of HFCS to Mexico for more than four years. Losses of $944 million in HFCS sales, equivalent to 168 million bushels of corn, have been sustained every year the tax has been in place, with additional sizable losses to investments. The price per bushel of corn in the United States could rise by 10 cents in key corn states or 6 cents nationally when the Mexican market is fully restored for corn sweeteners.
 
In October 2005, the WTO issued a final ruling on the HFCS case in favor of the United States; however, it was later appealed by the Mexican government. The ruling this week upheld decisions of the final WTO panel report and sided with the United States on all counts.