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South Central Iowa | Just the same news. It trickled through the trade first day, then the farm media the next day, then the financial press a couple days later, now the mainstream press a few days after that.
This is a report about US-Mexico trade:
https://fas.org/sgp/crs/row/RL32934.pdf
We are dependent on each other. Mexico helps make the United States more globally competitive in many industries. That said, the primary take-away is the Mexico is completely dependent on trade with the United States; they would be nothing without it. Exports make up 36% of their economy and 80% of that is trade with the United States; we are 29% of their economy. Our exports to Mexico total $236 billion in 2015 and which represents roughly 1.3% of our economy (yes I know exports-imports is how it is figured into GDP, but they are something). Furthermore, the US economy in nominal GDP is $17.2 trillion against $1.2 trillion for Mexico. We are everything to them and they are very little to us, that is just a fact.
As far as corn itself, the 16/17 projections, show total Brazil and Argentina production 133 mmt of corn with combined domestic use of 69 mmt leaving a remainder of 54 mmt. Total global exports a projected at 149 mmt which means countries other than those two must export 95 mmt. The United States is projected at 56.5 mmt, a number that is likely to grow over the course of this year because total foreign production is projected at 655 mmt while foreign domestic consumption is projected to be 718 mmt, a difference of 63 mmt. Those are Wasde numbers from the February report.
So in summary, we will likely have greater corn exports this year than the USDA projects right now and Mexico economy is reliant on the US to a degree that is unfathomable to most people. If trade ended with the United States, Mexico's GDP would halve or quarter at least; they would be utterly destroyed. They are aware of this; don't believe the hype. | |
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Mexico
