Mexico readying legal defense in sugar dispute with U.S.

Reuters News
Posted: May 12, 2014 7:51 PM

MEXICO CITY (Reuters) - Mexico is getting ready to defend its sugar producers in a dispute over allegations of dumping made by U.S. competitors, Economy Minister Ildefonso Guajardo said on Monday.

On Friday, U.S. trade regulators ruled in favor of investigating allegations launched nearly two months ago that Mexican mills are dumping sugar below the cost of production in the United States.

Mexico and the United States are still open to dialogue in the matter, Guajardo told reporters.

"But at the same time we're preparing a legal defense for Mexican producers," he said. "I wouldn't be surprised if Mexican sugar producers and national fructose producers look at fructose competitors in the United States and don't necessarily see terms they consider fair."

Guajardo said that while it is not up to him to push for retaliatory trade measures, he would have to investigate any requests of that kind from the industry.

Carlos Blackaller, president of Mexico's national cane growers' union, stopped short of requesting such measures in an interview on Monday. But he told Reuters the local sugar industry has documented that the cost of U.S. fructose exports to Mexico are about 35 percent less than domestic Mexican fructose.

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"Of course, if (the U.S. government) establishes some measure that limit Mexican sugar exports into the U.S. market, then we would have to find a mechanism to explain why fructose imports arrive with that discount," Blackaller said.

(Reporting by David Alire Garcia; Editing by Mohammad Zargham)