The effect of PROCAMPO on the production and imports of forage grain in Mexico
DOI:
https://doi.org/10.29312/remexca.v3i5.1409Keywords:
Zea mays L., Sorghum bicolor L. Moench., simultaneous evaluation models, NAFTA, importacionesAbstract
To measure the effects of PROCAMPO on the production and importation of maizemaíz (Zea mays L.) and sorghum (Sorghum bicolor L. Moench.), two supply functions were estimated using the series 1980 to 2009, and constructing a system of equations from 2007 to 2009. The results indicated that maize and sorghum have an inelastic response when faced with the PROCAMPO payment and with elasticity of 0.24 and 0.22 for maize and sorghum. If PROCAMPO would not have existed, the production of maize and sorghum would have been less in 17 and 9.1%, when considering the observed level in 2007-2009. An increase of 50% in the PROCAMPO payment would increase the production of maize and sorghum to 1 924 and 286 thousand tons, and lessen the imports of those crops. The evolution of the international maize and sorghum prices and of the fertilizer prices from the period of 1993-1995 and from 2007-2009, allows us to conclude that the North American Free Trade Agreement (NAFTA) has not benefited producers, as the supply of maize and sorghum observed from 2007-2009 was less than 1 656 and 27 thousand tons because of the decline of international prices for both grains. Similarly, the maize and sorghum production that was observed from 2007-2009 was less than 455 and 254 thousand tons because of the effect of the increase in fertilizer price. Given the positive effects of PROCAMPO, and the negative effects that NAFTA has had on the grain market, it is recommended that the PROCAMPO not only continue but increases its bestowment of support.
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