Quantcast

How a US-Mexico border closure could impact your next meal

An employee slices avocados to be made into fresh guacamole at Chipotle Mexican Grill's Sunset and Vine store in Hollywood, California, on July 16, 2013.

PATRICK T. FALLON/BLOOMBERG

By MICHAEL HIRTZER AND MARIO PARKER | Bloomberg | Published: April 4, 2019

An actual shutdown for the U.S.-Mexico border would have far-reaching consequences on economies and people, but one unexpected victim could also be the average American's breakfast plate.

Favorites such as avocado toast and healthy berries would be at stake if agriculture trade stops between the nations, since U.S. consumers enjoy a lot of Mexican fruit and other produce. On the flip side, American farmers, already reeling from the U.S.-China trade war, could see demand shrink from another major export market.

So far, there hasn't been much market reaction, save for avocados, where a 34 percent jump in prices this week could be a harbinger of the chaos to come if Donald Trump follows through on his threat.

Here are some of the markets that could see disruptions:

1. Guacamole + Margaritas-  Just as the weather is starting to warm north of the border - prime time for poolside guacamole and margaritas - a border shutdown would threaten key ingredients since the U.S. relies on Mexico for avocados, limes and tomatoes.

Chipotle Mexican Grill alone uses more than 200,000 avocados a day to make guacamole at its 2,500 stores. Border disruptions would severely tighten supplies, and potentially see Hass avocado prices skyrocket. That's why Chipotle is looking into alternative avocado supply options. Meanwhile, asparagus is also in the firing line, and shippers are trying to cross as much as possible in preparation for a shutdown, according to U.S. fresh produce distributor Pro*Act.

2. Berries - Mexico is also a major mixed berry supplier to the U.S. With the U.S. harvest still weeks away, a border shutdown would create an immediate supply gap in raspberries, blackberries and blueberries, Pro*Act said in a letter dated Tuesday. Strawberries would be safe amid rising domestic supply.

3. Grains - Consumers south of the border would also feel the pain of disruptions to food supplies. Mexico is the top export market for U.S. corn, accounting for about $2.8 billion worth of grain shipments last season. Removing that level of sales would be another hammer blow for U.S. growers already grappling with flooding, a trade war with China and years of low prices. Supply woes could also push up prices of Mexican staples such as tortillas.

4. Meat and Milk - Mexico is also the top importer of U.S. pork and non-fat dry milk, two other key items in the country's kitchens. As concerns over a shutdown do the rounds, the U.S. Meat Export Federation has staff in Mexico keeping vigil for any disruptions. For now, though, it's been business as usual, Joe Schuele, vice president of communications at the U.S. Meat Export Federation, said by telephone.

In total, the U.S. exports about $19 billion in farm goods to Mexico, much of which are perishable. "A day could ruin a large percentage of a farm's harvest," said Will Rodger, a spokesman for the American Farm Bureau Federation.

With assistance from Lydia Mulvany, Shruti Date Singh, Leslie Patton, Kevin Varley and Maggie Otte.
 

from around the web