land use and land tenure change in the - El Colegio de Chihuahua

18of five, ten or fifteen years. Under NAFTA, US exports of grains, including corn, wheat, rice andsoybeans, have increased and are expected to continue to rise. US exports of cotton, pork, and chicken havealso increased, putting pressures on Mexican producers. As tariff barriers continue to be eliminated (theystill exist on corn, dried beans, and poultry, for instance), further surges in U.S. exports and related changesin Mexican production can be anticipated. The U.S. supplies approximately 7% of all of Mexico’sagricultural imports; its share was valued at over $5 billion in 1996.(http://www.fas.usda.gov/infor/factsheets/nafta.html)The trade in both directions has expanded although U.S. agricultural exports have risen more rapidlythan have Mexican exports to the U.S. The U.S. still imposes “safeguard” protections on Mexican exportsof onions, tomatoes, eggplants, chili peppers, squash and watermelon. Although horticultural trade in bothdirections (the U.S. top crops are apples, pears and table grapes) is rising, Mexican exports to the U.S. ofthese products have expanded at a faster rate, particularly sin the 1994 devaluation of the peso. Vegetableexports from the US are more than fruit exports from the US to Mexico. In 1997 Mexico accounted formore than $1.2 of $1.7 billion in fresh vegetable imports to the U.S. Tomatoes Accounted forapproximately $517 million of Mexican exports to the US and 80% of U.S. tomato imports).(http//www.fas.usda.gov/htop/highlights/1998/98-04/fvimp97/98fvimp.html)It is important to note that Mexican agricultural policy is driven not only by a search for theexpansion in vegetable, meat and dairy production is driven by demands from Mexico’s rapidly growingurban areas.It is important to note that Mexican agricultural policy is driven not only by a search for foreigntrade through exports, but also by the needs of an expanding domestic market. Much of the expansion invegetable, mean and dairy production is driven by demands for Mexico’s rapidly growing urban areas.As a result of economic instability and staggering national debt, Mexican support for the agriculturalsector more responsive to international competition and trade opportunities, recent administrations havealtered or discontinued previous policies that offered considerable protection to the sector. Most of thegovernment’s agricultural parastatals have been privatized. This has meant that Mexican producers are nowfacing market prices for many agricultural products and services such as fertilizer, commercial seeds,extension, crop insurance and credit. The system of price guarantees for many commodities has beenchanged, so that producer prices for crops such as barley, wheat, sorghum and other crops are closelyaligned with international market prices. Although the price of maize and beans remains somewhatprotected, they are gradually being adjusted to reflect the competition. In the 1980s, public investment inagriculture fell by more than 80% and rural credit by more than half. Subsidies on inputs such as fertilizerhave been phased out.In response to large increases in the number of agricultural loans in default and bank seizures offarmland during the 1980s economic crises, the government reformed the rural credit system. The publicagricultural credit bank, BANRURAL, is now operating on commercial principles, with the effect thatcredit availability has declined dramatically in recent years, particularly for those producers with limitedcollateral or financial security.In an effort to cushion some of the negative implications of these policy reforms for rural producers,the government has initiated a new agricultural program, PROCAMPO, that provides a direct payment of anestablished amount per hectare to each producer of basic crops (wheat, sorghum, maize, rice, barley, soya,cotton, sunflower, safflower and sesame). Although this program was intended to provide some support tothe small-scale peasant producers of central and southern Mexico who were likely to be most averselyaffected by increased competition from imported U.S. grains, many large-scale commercial producers arefinding that the program enables them to continue the production of otherwise unprofitable crops. ThusPROCAMPO may be providing an incentive for large-scale producers in the northern states to continue todevote large areas of land to crops in the PROCAMPO program, rather than convert this land to other uses.The economic crisis has directly affected agricultural producers who have sought private credit. In1993, estimates of farm loans in default ranged from $1.3 billion to 4 billion and banksliberalization/competition, reduced subsidies, and a slow economy.