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Mexico Deal Offers Market Access Gains for EU Dairy

The EU and Mexico reached an agreement on updated trading relations, within its modernised Global Agreement on 21st April, with substantial gains for EU dairy exports.

Mexico has a population of 128 million and is Ireland’s largest trading partner in Latin America (with trade worth €1.7bn last year). The agreement has established tariff free access for 99% of products traded between the EU and Mexico. Dairy products however will fall under new quotas with customs duties to be eliminated over a five-year period.

The newly established TRQs are as follows:

  • 20,000 tonnes for mature cheeses (including cheddar) and 5,000 tonnes for fresh chesses
  • 2,500 tonnes for butter (to be phased-in over 7 years)
  • 50,000 tonnes for Skimmed Milk Powder (beginning at 30,000 tonnes from entry into force). SMP is currently taxed at 50% and this liberalisation is certainly a very welcome development in the context of the current levels of stock in intervention
  • 13,000 tonnes for dairy preparations
  • Tariff reduction on Infant milk formula from 10% – 5% and going down to 0% after 7 years

The new agreement also commits to increased co-operation on health matters and product standards through the establishment of a SPS committee. Further technical details must still be finalised, with a full legal text expected at the end of 2018.

By Alison Graham 

European Affairs Executive