Mexican farmers replace tequila plant with corn

Ethanol demand has doubled corn prices, making it more profitable than agave.

from the June 21, 2007 edition

Page 2 of 2

Page 1 | 2

Salazar says plans for about 10 ethanol plants have surfaced, particularly in the north, but that his group is waiting to see if they are actually built. That's only a fraction of the 110 ethanol refineries in the US, but it has given new hope to Mexico's corn farmers, many of whom had abandoned their fields in recent decades as US subsidies made their yields uncompetitive.

For some it could not come at a better time: under the North American Free Trade Agreement (NAFTA) tariffs for corn and beans will disappear altogether next year. Demand for corn has alleviated some of those concerns.

But it has also pushed up prices for a Mexican food staple. Earlier this year corn tortilla prices doubled in some parts of the country, fueling protests and concerns for the 50 million poor Mexicans who depend on tortillas for the majority of their daily caloric intake.

And what if a national symbol, the agave, were to disappear?

"That is not going to happen," says Ramon Gonzalez Figueroa, director general of the Tequila Regulatory Council in Jalisco. If anything, he says, an overabundance of agave has pulled prices down.

On a recent day Jose Luis Cervante, a local farmer from the Tequila region, cuts the spikes off the agave. There is so much of it, Mr. Cervante says, that a local owner told him he could dig up a plant that was growing beyond his fenced in property, to plant on his own land.

Says Mr. Gonzalez: "Today, we have anything but a scarcity."

So his group is moving forward with plans for the Tequila Trail, a project funded by a multi-million dollar grant from the Inter-American Development Bank.

"This is Mexico," says Venegas Trujillo, picking up a spiky-blue plant from the side of the road. "It's beautiful. It's time we take advantage of this."

1 | Page 2