Mexican sugar industry anxious ahead NAFTA opening

By Mica Rosenberg and Frank Jack Daniel
REUTERS
1:27 p.m. December 11, 2007

MEXICO CITY – Three weeks before the United States and Mexico lift the last barriers to trade in sweeteners, sugar mill owners and cane farmers south of the border are worried they are in poor shape to compete.

Mexican sugar growers had hoped tariff-free trade would catapult them into the world's largest sweetener market. But Mexico's high production costs and lack of investment may keep champagne corks from popping in January, which ends 15 years of protective measures for sugar and corn under the North American Free Trade Agreement (NAFTA), which took effect in 1994.

“We can't compete with our hands tied. The United States offers its sector certain benefits and we should have the same. If not, there is no level playing field,” said mill owner Juan Cortina, who heads Mexico's sugar chamber.

Cortina said Mexico had not prepared its sugar sector sufficiently to compete with the more efficient and protected U.S. industry.