Mexico’s top court’s trade ruling has become a congressional ‘hot potato’

Twenty years ago, the U.S. agreed to open trade to Mexican avocados in exchange for U.S. potatoes and since that time, the National Potato Council and farmers have been struggling to get full access for fresh American potatoes to be sold throughout Mexico.

While Mexican avocado imports increased, U.S. potatoes were still unable to make their way across the border.

The Mexican government finally opened their country to U.S. potato exports in 2011, but limited access to only 16 miles past the border.

Since that decision, numerous legal cases have been filed by the Mexican potato industry to protect their domestic monopoly and prevent import competition.

A cartel known as the National Confederation of Potato Producers of the Mexican Republic (CONPAPA), which insisted the government does not have the authority to determine whether or not agricultural imports can cross into their borders, made their way to the Mexico Supreme Court in 2018.

The Mexican Supreme Court rejected the complaints filed by the potato farmers and supported full access to export trade for U.S. potato imports.

On March 28th, 2021, Mexico’s top court issued a final five-to-zero ruling that would officially allow U.S. potato exports full access to trade with Mexico—a ruling that was twenty years in the making.

Congressional leaders from potato-producing states signed a bipartisan letter calling on the U.S. Department of Agriculture (USDA) to press its counterpart in Mexico to honor and expedite the trade deal restoring U.S. fresh potato exports.

As the third-largest export market for U.S. potatoes, Mexico is a major part of the U.S. potato export trade.

The U.S. currently exports an estimated $60 million worth of fresh spuds each year to Mexico despite existing trade barriers. According to the National Potato Council, the market potential for full U.S. fresh potato access for Mexico is estimated at $200 million per year in five years.

Despite a Mexican Supreme Court ruling made in favor of U.S. potato producers and the completion of successful site visits made by Mexican authorities to U.S. potato plants in Colorado, the USDA’s Animal and Plant Health Inspection Service (APHIS) acquiesced to new demands by the Mexican government that will significantly delay and limit U.S. potato exports to Mexico in 2022.

“Given that Mexico appears to be continuing to avoid its responsibilities to restore this access, we request that APHIS explain its decision-making process to agree to these unscientific and inconsistent demands,” the lawmakers wrote.

“We respectfully request that USDA reconsider the statements announced at the end of February, as they are not stipulated in the work plan,” the letter continued. “The U.S. continues to honor our side of this trade deal, and it is imperative USDA ensure that Mexico do the same.” 

The full list of letter signatories and text of the letter can be found here and below:

Dear Secretary Vilsack:

We write today out of deep concern for the ongoing dispute regarding U.S. fresh potato access to Mexico.  It appears that Mexico is continuing to delay restoring this access that was blocked due to legal proceedings initiated by the Mexican potato industry over seven years ago.  The cost of this inaction is estimated to be $150 million to U.S. growers on an annual basis. We request that the U.S. Department of Agriculture (USDA) continue to work with their counterparts in Mexico to ensure that the trade deal is honored by expeditiously reinstating access for U.S. fresh potatoes and to express that any Mexican request for enhanced agricultural access to the U.S. should not be granted until this access is restored.

In December of 2021, Mexican officials toured U.S. potato operations in Colorado as the final step in restoring this access.  That site visit came after the Mexican Supreme Court unanimously ruled in April 2021 against the Mexican potato industry’s legal claims.  At the conclusion of the visit, Mexico indicated their satisfaction to USDA and further stated that market access should be complete by early February 2022.

However, on Wednesday, February 16th, 2022, the Animal and Plant Health Inspection Service (APHIS) jointly announced with their Mexican counterparts, SENASICA, that fresh table stock potato access would be substantially delayed well into 2022. That statement was made due to Mexico’s later demands for additional site visits in 2022 as a prerequisite to opening the market. Additionally, it was announced that processing potato access to Mexico would be arbitrarily limited to only two companies for 2022.

Neither of these requirements exist within the U.S.-Mexico work plan that was concluded at the end of last year.  As you will recall, the process that the U.S. is supposed to be pursuing is one to restore, not establish, access for these potatoes.  The U.S. had previously negotiated market access and was shipping potatoes to Mexico in 2014 until the Mexican industry filed suit in an effort to avoid competition with U.S. growers.

Given that Mexico appears to be continuing to avoid its responsibilities to restore this access, we request that APHIS explain its decision-making process to agree to these unscientific and inconsistent demands.  Additionally, we are extremely concerned that APHIS came to this agreement with SENASICA without consulting the domestic industry and that this may be indicative of the process that USDA is undertaking to restore fresh access.

We respectfully request that USDA reconsider the statements announced at the end of February, as they are not stipulated in the work plan.  The U.S. continues to honor our side of this trade deal, and it is imperative USDA ensure that Mexico do the same.