[3/8/17] Mexico has canceled existing sugar export permits to the United States in a dispute over the pace of shipments, according to a letter seen by Reuters, in a flare-up industry sources said could temporarily disrupt supplies.
The letter sent by Mexico’s sugar chamber to mills on Monday partly blamed the situation on unfilled positions at the U.S. Department of Commerce, which it said has led to a “legalistic” interpretation of rules with no U.S. counterparts in place in Washington for Mexican officials to negotiate with.
The cancellations are the latest dispute of a years-long trade row between Mexico – the United States’ top foreign supplier of sugar – and its neighbor at a time when cane refiners are struggling with prices and tight supplies, U.S. industry sources said.
The development also comes as ties between the United States and Mexico have frayed under U.S. President Donald Trump, who took office in January and wants to recast the North American Free Trade agreement as he sees the trade deal skewed to favor Mexico.
Monday’s letter made no mention of the political tensions between the two neighbors.
The permits were “suspended” to comply with accords with the United States because the export limit for the six months up to March 31 was reached ahead of time, said Juan Diaz Mazadiego, director of foreign trade at Mexico’s Economy Ministry.