Import Permit Auctions Signal Pinto Demand March 15, 2002
Mexico Holds First Import Auction
The Mexican government held the first of two 2002 import auctions for dry beans. The auction price established for the import permit for dry beans was $2.30 peso per kilo. The approximate U.S. price per cwt is $11-$12.
Mexicos import permit auctions are an important piece of the pinto market puzzle, says Bill Thoreson, sales manager with North Central Commodities, Johnstown, N.D.
The auctions signal how many U.S. and Canadian dry beans the Mexican government will allow the private sector to import.
Though the North American Free Trade Agreement spells out how Mexico is supposed to remove its tariffs and eventually allow the free flow of U.S. beans into the country, the Mexican government still regulates imports by auctioning the right to import dry beans.
This year, the Mexican government announced the dates of two import auctions. The first auction was scheduled March 1 for 21,112.96 metric tons (MT) of dry beans. Permits will be valid through May 30.
The second auction will be held May 31. It covers 42,225.93 MT, with import permits valid until the end of September 2002.
Thoreson says key things to watch for in the auctions, include:
" If they are held on schedule. If the auction is held on the scheduled date, it means Mexico is going ahead with plans to buy beans. That may bolster, or at least help maintain prices, if the trade has already figured the sales into the market.
" Prices Mexican companies pay for the permit auction. The cost of the permits amounts to a defacto tariff on dry beans. The bids reflect what buyers may think Mexican consumer demand may be.