MEXICO-MEAT EXCLUDED FROM SANCTIONS.
U.S. meat exports will be excluded from Mexico ’s tariff increases planned for 90 U.S. agricultural and industrial products, a spokesman from the Agriculture Ministry said on Tuesday.
The higher tariffs are planned in retaliation for Washington ’s move to ban Mexican trucks from entering the United States .
"The list does not include the commerce of products that form part of the basic basket of goods like beef, pork and poultry," the spokesman said.
Mexico ’s economy ministry said the tariff scheme would avoid raising prices for local consumers by excluding staples not covered by local production, like rice, corn, wheat and beans other than soy. Mexico ’s national meat council confirmed all meat products would also be exempt.
Mexico on Wednesday will publish a list of U.S. goods to be hit with the duties.
Eugenio Salinas, the head of the council said meat producers and importers negotiated with the government last week to keep meat products off the list, fearing the tariffs could lead to inflation for Mexican consumers.
Mexico imports up to 35 percent of the meat it consumes, the bulk of that from producers in the United States , the meat council said.
U.S. meat producers had been anxiously waiting to see whether their exports would face steeper costs to gain entry. Because of its proximity and the NAFTA deal, Mexico is one of the top export markets for U.S. beef, pork, chicken, and turkey.
Cattle and hog futures prices at the Chicago Mercantile Exchange were pressured early in the day on fears that the tariffs could apply to U.S. beef and pork. Prices recovered later on talk that meat probably would be excluded.
Alberto Ramos, an economist from Goldman Sachs, said the dispute was unlikely to escalate further.
"We believe that these developments will not lead to an escalating trade war between the two countries and expect a negotiated compromise solution to be achieved in due time," Ramos said in research note.