Mexico threatens to activate T-MEC against the US “Product of USA” label.

The Mexican government rejects the U.S. Department of Agriculture (USDA) declaration of “Product of America” labeling.

The Ministry of Economy analyzes activating the T-MEC and WTO dispute resolution processes so that “the United States adheres to its obligations regarding technical barriers to trade.”

According to the Mexican government, restrictions on the use of the “Product of the United States” label on derivatives of animals that are born, raised, slaughtered and processed exclusively in the United States are against the law. Discrimination against Mexican producers.

It is said that the decision may create barriers in bilateral production chains, in particular, to Mexican exports of live cattle, beef and their derivatives, which in 2023 amounted to $3 billion.

This measure threatens to generate devastating impacts on food chains, as well as logistical complexities and additional costs, which will ultimately be borne by Mexican producers, but primarily by American consumers.

The Mexican government claims that the labeling conflicts with the principles of economic integration between Mexico, the United States and Canada.

According to the Economy Statement, there are already precedents against this type of action:

In fact, designations of origin have been recurring topics in our business relationship. Suffice it to remember that as early as 2002, the World Trade Organization declared that a measure of this kind promoted by the United States was unacceptable. At the time, the final decision estimated the impact on Mexico at $227 million. Years later, the United States decided to withdraw the measure in order to comply with the ruling and avoid imposing costly retaliations.

On Monday, March 11, the USDA announced the completion of a rule to implement the “Product of the USA” label.

According to the Biden administration, this measure is “a vital step towards consumer protection” and means strengthening small producers.

“This final rule will ensure that when consumers see the words 'Product of USA,' they can trust the authenticity of that label and know that every step involved, from birth to processing, is… Made right here in the USA“.

This measure is part of President Biden's executive order on enhancing competition in the US economy.

The final rule allows the label to be used on meat, poultry, and egg products only when they come from animals Born, raised, slaughtered and prepared in the United States.