Mexico suspends import duties on pork, beef and poultryMexico suspends import duties on pork, beef and poultry
Duties remain in place on variety meat and processed products.
May 23, 2022
As part of its effort to combat food price inflation, the Mexican government has suspended import duties on pork, beef and poultry through the end of 2022. Mexico has previously opened duty-free quotas for pork and poultry, but this is the first time a blanket suspension has been ordered. Zero-duty access will be granted to fresh and frozen muscle cuts from all eligible suppliers, but duties remain in place on variety meat and processed products.
Erin Borror, U.S. Meat Export Federation vice president of economic analysis, notes that all U.S. and Canadian pork and beef (including variety meat and processed products) already enter Mexico at zero duty under the North American Free Trade Agreement and the U.S.-Mexico-Canada Agreement. Brazilian pork and beef are not eligible for Mexico, so she explains that the main beneficiaries of this policy change will be European pork suppliers.
"This general policy has been done by Mexico in the past and actually even last year, they again opened a 10,000 ton duty free quota for pork cuts, and they have opened periodic 30,000 ton quotas for poultry. Brazil is only a factor on the chicken side and remains ineligible to ship both pork and beef to Mexico," Borror says. "So on the pork side, the size of the Mexican market and its general open nature, that is certainly drawing the competitors into this space. Europe has been in the market really making a splash when we were under those retaliatory metal tariffs from 2018 to 2019, for about a year. Europe has gone from basically zero import share to 1.6% last year."
Borror sees very little impact on Mexico's beef imports, nearly all of which already enter the market duty-free from the United States, Canada and Nicaragua. Australia exports small volumes of skirt meat to Mexico, but this is classified as beef variety meat and remains subject to a 14.6% duty under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
Brazil will be the primary beneficiary on the poultry side as imports from other major suppliers, including the United States, already enter Mexico at zero duty.
Borror says its important to note these tariff reductions have not included variety meats or processed products.
"And that's a big chunk of what Europe has been shipping. The variety meats are entering at a 10% tariff from Europe. But again, elimination of those tariffs on the muscle cuts will likely contribute to some additional EU growth," Borror says. "On the beef side it's pretty much irrelevant. U.S., Canadian and Nicaraguan beef are the main suppliers to the market and have duty free access already. Australia mainly ships skirt meat, which is actually under the variety meats code, so again, it's not included in these blanket tariff eliminations, so they're paying a trade agreement tariff rate of 14.6%."
Source: U.S. Meat Export Federation, which is solely responsible for the information provided, and wholly owns the information. Informa Business Media and all its subsidiaries are not responsible for any of the content contained in this information asset.
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