News Release

FOR IMMEDIATE RELEASE                                            CONTACT:    Curt Mercadante

December 23, 2003                                                                                         202-331-1634

Corn Refiners Denounce Mexico’s Vote to Extend Sweetener Tax

WASHINGTON, DC – The Corn Refiners Association (CRA) today denounced the vote by Mexico’s lower house of Congress to maintain the 20% tax on soft drinks made with high fructose corn syrup (HFCS).   

“This vote comes almost two years to the day that the Mexican congress first enacted the discriminatory tax on HFCS and threatens to cause irreparable damage to the overall U.S.-Mexico trade relationship,” said CRA President Audrae Erickson. “Their continued efforts to impose this tax call into question their commitment to improving the climate for investing in their country.”

The tax, first enacted by Mexico in January 2002, has caused significant investment and job losses to U.S. companies that made substantial investments in Mexican and U.S. HFCS capacity.  It also has shut down U.S. exports of HFCS to Mexico for two years.  Mexico is an estimated two million metric ton market for U.S. exports of HFCS, making it the top export market prior to the tax. 

For every 2 million metric tons of HFCS access into Mexico, the U.S. will lose: $620 million annual HFCS export sales; more than $300 million annual corn sales; 133 million bushels of bulk corn production; 945.7 thousand acres of corn production; and additional losses to seed, fertilizer and farm machinery industries and related rural investment.

CRA applauds the efforts of U.S. Congressional leaders, including Senate Finance Chairman Charles Grassley (R-IA), Senate Agriculture Committee Ranking Member Tom Harkin (D-IA), Senate Foreign Relations Chairman Richard Lugar (R-IN), House Agriculture Chairman Bob Goodlatte (R-VA) and Congressman Ray LaHood (R-IL), who have all recently called for retaliatory action in response to the Mexican soft drink tax.

CRA endorses Mexican Agricultural Trade Compliance Act (MATCA), introduced by Chairman Grassley, which would impose trade duties on Mexican products such as tequila in retaliation for the soft drink tax.   For more details on that bill, you can view Chairman Grassley’s floor speech introducing the bill and the accompanying press release at:  http://grassley.senate.gov/releases/2003/p03r11-25.htm.

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