CAB - Researchers tetsing new production techniques

- Summer 1995 "Update" Newsletter Article -
SURVEY PROJECT TRACKS FRUIT TRADE WITH MEXICO
From CATI Publication #950701
Copyright © 1995. All rights reserved.

Signing of the North American Free Trade Agreement (NAFTA) in 1993 was supposed to spark a boom in agricultural trade between the U.S. and Mexico. Now the question is - has it?

At least a partial answer to that query should come later this year as a result of research being conducted by an agricultural economist at California state University, Fresno's California Agricultural Technology Institute (CATI).

Professor Juan C. Batista, who conducts research for CATI's Center for Agricultural Business, is nearing completion of a study which included a survey of agricultural trade representatives throughout Mexico. One of the goals of the survey was to determine if deciduous fruit trade has increased, and by how much, since NAFTA took effect in January 1994. The landmark agreement called for reductions in tariffs and relaxation of restrictions on both sides of the U.S.-Mexico border. It would bring increased trade and prosperity to a majority of growers and traders in California, supporters claimed.

But a fundamental question about trade lingers beyond the signing of NAFTA, Batista explains. That is - is Mexico's transportation industry capable of handling a trade increase?

"The barrier to trade may not be the price of products, or tariffs," Batista said. "It may be the distribution infrastructure designed to support the movement of fruit between Mexico and the U.S. The infrastructure to accommodate increased trade may not be there."

In previous Mexico transportation studies Batista learned that transportation infrastructure, or the lack of it, is a key factor in limiting the movement of agricultural products in Mexico. Poor road conditions in certain areas, limited train or truck service, shortages in cold storage warehouse space, and a lack of trained customs personnel could all be factors limiting the freer flow of goods.

Batista's study is focusing on the trade of deciduous fruits, which require careful handling and are subject to specific protocols in order to assure quality standards. Deciduous fruits commonly exported from California to Mexico are peaches, plums, nectarines, grapes, apples and pears.

Batista is seeking information from two major sources. One is the handlers themselves. Through an agreement with the University of Guanajuato in central Mexico, a team of researchers surveyed brokers, importers, exporters, truckers, wholesalers, retailers, government agencies and banks in Mexico to determine changes, if any, in levels of trade in Mexico.

Additional information is being gleaned from secondary sources such as trade reports by U.S. , California and Mexican government trade offices.

"These documents will serve as a data base from which we can gather additional information on what's moving," Batista said.

Study results should reveal how trade has changed since NAFTA took effect. Batista said early indications are that the flow of goods from the U.S. to Mexico has not increased that much, especially since the sudden drop in value of the peso last December.

Publication information will be provided in future issues of Update. For more information, Batista may be contacted through the Department of Agricultural Economics at (559) 278-2464.

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