Don’t blame Mexican tortilla crisis on biofuels, blame subsidized corn instead

We have received some sharp questions from readers on why we do not report on Mexico’s widely covered ‘tortilla crisis’. Don’t these protests prove that there is a growing conflict between food and fuel? We don’t think so. The questions stem from the unnuanced way in which mainstream media report on biofuels. The price increases of tortillas in Mexico are not due to biofuels as such, they are entirely due to the fact that corn and corn ethanol are extremely heavily subsidised in the U.S. and protected against foreign competition by high tariffs. Biofuels and U.S. corn ethanol are two entirely different things.


Thousands of Mexican farmers used to grow corn, but in 1994 the North American Free Trade Agreement (NAFTA) signed their death warrant. From then on, Mexico started importing cheap, subsidized corn from the U.S., where farmers receive billions each year under hundreds of support schemes. Mexico became entirely dependent on these imports, and disinvested its domestic corn production. When today, heavily subsidized U.S. farmers sell their crop as a feedstock for ethanol – which in turn is once again subsidized – then the consequences are obvious: shortages lead to price increases, and consumers in countries forced into dependence suffer. Many Mexican farmers have meanwhile quickly taken up growing corn to profit from the increased prices, but this will not solve the problem.

So let us stress this again: don’t blame biofuels for the tortilla crisis, be more nuanced and explicitly blame subsidized corn, subsidized corn ethanol (which does not deserve the ‘biofuel’ label), the US$0.54 tariff on ethanol imported from the South, and a free trade agreement detrimental to Mexico.

Biopact