April 3, 2006

Mexico's 2006 yellow corn import quota seen at 3.6 million tonnes

Mexico's Economy Ministry has set the 2006 import quota, popularly known by its Spanish name "cupo," for duty free US yellow corn at about 3.6 million tonnes, traders and importers said Friday (Mar 31).

"The cupo for 2006 was set at 3.6 million tonnes. The details have not been publicly released but sent directly to the traders and importers," said a trader with a large Western importer in Mexico.

"The quota was established some time ago and people have already started placing orders for the second quarter," said another trader.

The 2006 cupo is similar to the duty-free import quota in 2005 where the government initially set the lucrative import quota at 3.564 million tonnes, 10 percent lower than Mexican yellow corn imports in 2004 of 3,972,360 tonnes.

Final import figures for 2005 have yet to be released by the Agriculture Ministry but Mexican grains imports from the US have decreased in recent years as national output have grown in line with increased plantings and modernisation of farming practices.

A special tariff for above-quota corn imports may be set at a later time in the year if additional demand can not be filled by local supply.

Above quota yellow corn imports were in 2005 set at one percent, in line with the North American Free Trade Agreement which seeks to gradual reduce tariffs until a complete opening of markets takes place in 2008.