August 19, 2002

The National Corn Growers Association (NCGA) and the Corn Refiners Association, Inc. (CRA) have expressed their support of the efforts of senators to encourage U.S. Trade Representative (USTR) Robert B. Zoellick to seek a negotiated solution to the ongoing sweetener dispute between Mexico and the United States.

A tax placed on high-fructose corn syrup (HFCS) by the Mexican government last year could place an unfair disadvantage on soft drinks produced from corn sweetener and U.S. corn sales could face a $66 million reduction. Twenty-two Senators sent a letter urging an interim solution taking U.S. agricultural export interests into full account.

"Resolution of this dispute is an integral element in increasing farm family income for our growers," said Jon Doggett, vice president of public policy for NCGA. "Mexico is the second largest market for bulk U.S. corn exports."

"We are determined to restore access for U.S. high fructose corn syrup exports to our number one market. This is a critical issue for the U.S. corn industry, as evidenced by the support of these senators," said CRA President Audrae Erickson.

The letter states, "This dispute must be resolved in a manner that grants acceptable access of U.S. HFCS to the Mexican market and Mexican sugar to the U.S. market as an interim solution. The U.S. corn and corn processing industries have been badly hurt by Mexico's refusal to grant fair and reasonable market access for corn-based products.

"Over the past year, the Mexican government has erected several barriers-including a tax on soft drinks sweetened with HFCS, HFCS import licensing requirements and a quota on imports of HFCS, essentially closing a $240 million market to U.S. corn refiners and had a devastating effect on U.S. HFCS production investments in Mexico.

"Several corn-processing companies have invested over $800 million in refineries in Mexico since the North American Free Trade Agreement (NAFTA) was passed. The HFCS market in Mexico includes a demand for about 32 million bushels of corn. If the United States' ability to supply the soft drink market in a cost effective manner is diminished by this tax, corn growers across the country will be negatively impacted."