Introduction to the Grupo Consultor de Mercados Agrícolas (GCMA)
The Grupo Consultor de Mercados Agrícolas (GCMA) is a prominent advisory group in Mexico’s agricultural sector. Comprising experts and professionals, the GCMA plays a crucial role in shaping policies and ensuring transparency in agricultural markets. Their recent concerns highlight the need for clarity and fairness in Mexico’s corn support system.
GCMA’s Concerns Regarding the New Corn Support System
The federal government recently announced a new support system for corn production. However, the GCMA has raised concerns that this system creates a disparity of up to 1,400 pesos per tonne between different regions and lacks clear criteria for defining the market price. This ambiguity undermines certainty for both producers and buyers, which is essential for a stable agricultural market.
Current Support System Details
Under the new system, the implied market price for white corn for producers would be 4,850 pesos per tonne plus a support of 950 pesos, totaling 5,800 pesos per tonne. However, this price is only applicable in Guanajuato, Jalisco, and Michoacán, leaving out producers in other regions who grow white and yellow corn during the Spring-Summer 2025 cycle.
Impact on Small and Large-Scale Producers
The GCMA’s director highlighted that the new system leaves small-scale producers (with up to 5 hectares) uncertain about whether they will receive the guaranteed price of 7,200 pesos or the 950 pesos per tonne incentive. Meanwhile, large-scale producers (over 5 hectares) across the rest of Mexico are excluded from this support, affecting their ability to participate in corn production.
Importance of Clear Price Definitions
The GCMA emphasized that without clear definitions for prices, it becomes impossible to establish reliable commercial agreements or ensure contract compliance between producers and the industry. This uncertainty can lead to market instability, affecting both producers and consumers.
GCMA’s Recommendations
The GCMA urges the Secretaría de Agricultura, Ganadería, Desarrollo Rural y Pesca (SAGARPA) to publish the reference prices before the upcoming planting season. This action is crucial as farmers are already preparing for the O-I 2025/26 cycle. Furthermore, the GCMA suggests that the reference prices should include sorghum and wheat, which are currently excluded from guaranteed prices.
Key Questions and Answers
- What is the Grupo Consultor de Mercados Agrícolas (GCMA)? The GCMA is a reputable advisory group in Mexico’s agricultural sector, comprising experts and professionals who shape policies and promote transparency in agricultural markets.
- What are the concerns raised by GCMA regarding the new corn support system? The GCMA is concerned that the new system creates price disparities between regions and lacks clear criteria for defining market prices, undermining certainty for producers and buyers.
- What are the implications of the new support system for small and large-scale producers? Small-scale producers (up to 5 hectares) are uncertain about the support they will receive, while large-scale producers (over 5 hectares) are excluded from the new system, affecting their participation in corn production.
- Why is it important to have clear price definitions? Clear price definitions are essential for establishing reliable commercial agreements and ensuring contract compliance between producers and the industry, promoting market stability.
- What recommendations has the GCMA made regarding the new corn support system? The GCMA urges SAGARPA to publish reference prices before the upcoming planting season and includes sorghum and wheat in the reference price system.
