The Union of Dairy Producers of the Mexican Republic and the Mexican Dairy Federation asked the government to refrain from presenting offers in the negotiations for the Trans Pacific Partnership (TPP), which are being carried out in Atlanta, Georgia, United States, that have not been agreed to by the national sector.
The National Front of Dairy Producers and Consumers demanded that the product be removed from the negotiations. Alvaro Gonzalez Muñoz, the group’s president, explained that the risks are very high, since the nations that make up the commercial bloc will offer very low prices for dairy products, which will lead to the bankruptcy of the majority of the 250,000 producers.
Vicente Gomez Cobo, president of the Mexican Dairy Federation, indicated that the national negotiators “should not use milk producers as a bargaining chip. We are not like textiles or patented medicines.”
Salvador Alvarez Moran, president of the Union of Dairy Producers of the Mexican Republic, explained that the sector is going through a profound crisis, created by the oversupply of milk on world markets, which has led to a 70 percent drop in prices in the last year and a half. “The situation could get worse if we include dairy in the TPP, since New Zealand is the main exporter of milk and cheeses in the world. Its competitive advantages allow it to produce milk at half of what it costs in Mexico.”
He referred to the Mexican dairy supply chain, which is made up of 250,000 farms, of which 96 percent have fewer than 100 heads of cattle, and which generate 635,000 direct and indirect jobs.
Both reported that the 240,000 dairy producers continue to confront a complicated situation due to the low prices they receive, which are below the costs of production. “Hundreds of small and medium producers are at risk of disappearing,” they indicated in separate interviews.
Gomez Cobo said that production costs have risen 30 percent due to the effects of the devaluation of the peso against the dollar, since 85 percent of inputs are priced in that currency.