México imports large quantities of maize, creating an ever increasing dependence and vulnerability to the changes in international production. It also creates susceptibility to the decisions and policies that are established, especially in the USA, which is the principal supplier of corn for México and the major producer and exporter in the world. The objective of the present study was to evaluate the effects of the policies of biofuel production in the USA. on the Mexican corn market. A regression model was used along with the price elasticities of the supply and demand of México. Six possible scenarios were established of biofuel production policy in the U.S., using information of FAPRI (2012), INEGI (2012), BANXICO (2012), USDA (2012) and SIACON (2012). Results show that during the period 2011-2026, corn prices in Mexico would drop 10 % in absence of the Blend Wall of ethanol and a high petroleum price (US $100/barrel), and 16 % in absence of both policies (Blend Wall and Renewable Fuels Standard). With the elimination of both policies and a low petroleum price (US $50/barrel), the demand of corn would increase by approximately 4 %, whereas the supply would decrease by 6.7 % and consequently, imports would increase by 31 %. The growth of bioethanol production from corn diminishes the supply of this grain, elevating the price. It is important to analyze and implement policies that promote self-sufficiency of corn production in Mexico. Otherwise, it is predicted that prices will be very high in a few years, with negative repercussions for the Mexican population.
|Translated title of the contribution||Impact of the United States biofuels' production on Mexican corn (Zea mays L.) market|
|Number of pages||13|
|State||Published - 2014|
- Agricultural policy
- Agricultural price