Sin ttulo de diapositiva

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RECENT POLICY DEVELOPMENTS IN THE MEXICAN
AGRICULTURAL SECTOR Andrés Casco Flores San
Diego, California Febrero 2000
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OUTSTANDING ASPECTS OF THE RURAL ECONOMY IN
MEXICO

• For the period 1994-98, the share of the
  agri-food sector in the Gross Domestic Production
  was on average 11.4 per cent .

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OUTSTANDING ASPECTS OF THE RURAL ECONOMY IN
MEXICO

• Productivity in units of less than 5 ha. ranges
  from 0.5-2.3 tons.
• Productivity in larger units migh reach 8-10 tons.

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AGRICULTURAL POLICY IN MEXICO AND SUPPORT
PROGRAMS IN THE RURAL SECTOR

• PROCAMPO
• Applicable since 1994 for supporting the income
  of the producers of grains and oilseeds.
• The eligible crops are maize, beans, wheat,
  sorghum, rice, soybean, safflower, cotton and
  barley.
• The elegible acreage must be used in crops,
  livestock, forestry or conservation uses.
• PROCAMPO has benefit an average of 13.7 millions
  of ha. annually. More than half of the total
  acreage benefited belongs to producers with less
  than 10 ha. per unit of production, and
  represents more than one fourth of their income.

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ALIANZA PARA EL CAMPO

• This Program operates under a decentralize
  scheme. The decisions are taken at local level in
  an Agriculture State Council.
• Federal and State support complement producers
  investments.
• The main programs of Alianza para el Campo are

• Ferti-irrigation Rural Equipment
• Mechanization Elementary Technical
• Improved Seeds Assistance
• Genetic Improvement Training and Extension
• Prairies

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MARKETING SUPPORT PROGRAM FOR GRAINS AND OILSEEDS

• The main objectives of this Program are
• offset the negative factors that have an effect
  on the marketing of grains and oilseeds, and
• support under a selective approach, targeted to
  products and regions with structural problems.
• In 1999, marketing support payments, for specific
  regions, were granted to soybeans, rice, wheat,
  sorghum, cotton and maize.
• Marketing supports are allocated through public
  auctioning.
• Buyers that requires the lowest subsidy and
  commits themselves to pay a certain price to the
  producer receive these supports

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RISK MANAGEMENT SUPPORT PROGRAM

• The main objective of this program is to support
  producers expected harvest income, through
  hedging instruments for management of risks
  related to the fluctuations in the international
  prices.
• The eligible crops for receiving supports for
  hedging are

MAIZE COTTON WHEAT
SORGHUM SOYBEANS
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THE EXTINTION OF CONASUPO

• Since the crop season Spring-Summer 1998/99,
  CONASUPO ceased to buy corn and beans.
• In the past, CONASUPO bought to producers at a
  guarantee price. It operated the warehouses in
  production and consumption areas, and was in
  charge of the whole logistics.
• CONASUPO supplied maize to the tortilla
  industry at subsidized prices.
• In December of 1998, price controls for
  tortillas were abolished.

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PRICES OF TORTILLA
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TRANSITIONAL SCHEMES FOR MAIZE

• In most production areas, the market has
  substituted efficiently the role of CONASUPO. The
  tortilla producers have become a Key player in
  this market.
• Marketing problems have appeared in those states
  that generate large surpluses and are far from
  main consumption areas (especially Sinaloa and
  Chiapas).
• Maize of Sinaloa and Chiapas was included in the
  marketing support Program operated by ASERCA.
• In Sinaloa, three auctions were made for the
  Autumn-Winter season. The private sector
  purchased the total amount for this crop.

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MARKETING SUPPORTS FOR MAIZE ALLOCATED BY ASERCA
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TRANSITIONAL SCHEMES FOR MAIZE IN CHIAPAS

• In Chiapas, conditions are more difficult for the
  development of a free market.
• Lack of knowledge of marketing instruments
  (marketing loans, options, futures, etc).
• Lack of producer organizations with
  entrepreneurial skills.
• Deficiencies in railroads and problems in the
  transport system.

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CONASUPOS PURCHASES OF NATIONAL PRODUCTION OF
MAIZE
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TRANSITIONAL SCHEMES FOR MAIZE IN CHIAPAS

• Marketing support program was granted through
  ASERCA to main buyers under an auction system, as
  well as through direct allocation for firms
  located in the area.
• A trust operated by the State Government has
  purchased a large part of the crop. It is
  financed by a credit line it only purchases on
  account of the interested buyers.
• SAGAR has designed a program to train producer
  organizations in marketing and provides some
  support to induce marketing cooperatives.

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TRANSITIONAL SCHEMES FOR MAIZE IN CHIAPAS

• Former CONASUPO infrastructure in the State will
  be transferred to producers, in a way that
  enhances the formation of marketing cooperatives.
  The medium term objective is to create conditions
  similar of those of Sinaloa.
• CONASUPO operated 200 warehouses in the State of
  Chiapas. Under the new scheme only 102 warehouses
  were enabled by the State Trust. This fact shows
  that CONASUPOs infrastructure was larger than
  strictly necessary.
• The estimated crop production for this season is
  450 thousand tons. So far 350 thousand tons have
  already been marketed by private purchasers.

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INTERNATIONAL VS DOMESTIC PRICES OF
MAIZE 1994-1999
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AUCTION FOR IMPORTS OF MILK POWDER

• Until May of 1999, CONASUPO was the sole importer
  of milk powder to supply private processors and
  social programs for low income population.

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AUCTION FOR IMPORTS OF MILK POWDER

• Since the second half of 1999, import
  certificates are allocated directly to the final
  user.
• The allocation of quotas is based on historical
  consumption of each firm (for infra-marginal
  quantities).
• For complementary requirements, additional import
  certificates are auctioned. The result of these
  auction provide information on market conditions.
• DICONSA is also allowed to import directly milk
  powder for its social program.