MEXICO CITY May 15 Mexican officials said on
Wednesday it would exempt 300,000 tonnes of chicken imports from
tariffs in a bid to blunt steep price increases and tame a spike
Economy Minister Ildefonso Guajardo said the exemption on
tariffs on imports would include whole chickens as well as
chicken parts. The government is also dropping tariffs on
tomatillos and limes to zero, he said.
An avian flu outbreak in Mexico has pushed up chicken
prices, while bad weather hit tomatillos - a main ingredient in
local green sauces - and a fruit disease affected lime crops.
A 17.25 percent increase in fresh food prices in April this
year compared to April 2012 drove Mexico's annual inflation rate
to 4.65 percent, above the central bank's 4 percent tolerance
ceiling for the second month in a row.
Political pressure is rising on the government to try to
contain the spike in consumer prices. This is the first price
shock that President Enrique Pena Nieto has faced since taking
office last December, although Mexico last year cut tariffs on
egg imports after a similar price surge.
Mexico has a free-trade deal with the United States and
officials said the measure was meant to spur imports from other
countries, such as Brazil.
"We understand why (the government) would take such action
... although I don't really think it's necessary and I'm not
sure how competitive products from other destinations further
away from the U.S. will be in the Mexican market," said Jim
Sumner, president of the USA Poultry and Egg Export Council, the
main U.S. export organization for chicken.
Mexico's economy ministry last year ruled that U.S. poultry
exporters sold chicken legs and thighs in the Mexican market for
below their cost of production, an unfair trade practice.
However, Mexico refrained from imposing any retaliatory
measures due to an avian flu outbreak that caused a jump in
consumer prices last year.