Category Archives: Politics

Changes to ethanol NOM prompt fuel market debate

Corn squeezins
Corn squeezins

Mexico’s Energy Regulatory Commission (CRE) published modifications to the country’s fuel quality standard, NOM-016-CRE-2016, on June 26, 2017, stoking an ongoing kerfuffle among parties on either side of the ethanol-as-fuel debate.  Beyond the philosophical grandstanding, the changes to the reg have potential to impact the evolution of the fuel industry in Mexico and as is often the case, they are generating no small amount of confusion.

Over the past 10 years, national oil company Petróleos Mexicanos (Pemex) has repeatedly announced its intention to introduce gasoline containing ethanol into the Mexican market, only to suspend the effort for one reason or another each time, most recently in 2015.  The standard permitting up to 5.8% ethanol as an oxygenate in gasoline has been on the books since August 2016, yet as best we can determine, gasoline currently sold in Mexico is oxygenated with MTBE rather than ethanol.  The recent modifications to the fuel standard include an increase in the maximum allowable percentage of ethanol in gasoline from 5.8% to 10%, clearing the way for the introduction of so-called E10 fuel.  The move comes within the context of Mexico’s energy industry reform, which allows for private production, importation and sale of fuels as well as the elimination of government establishment of fuel prices.  The elimination of gas price controls at the pump is currently being implemented by region, to culminate in nationwide free market pricing as of January 1, 2018. Continue reading Changes to ethanol NOM prompt fuel market debate

U.S. triggers 90-day waiting period for NAFTA negotiations

Frenemies
Frenemies

On May 18, the Trump administration sent formal notice to the U.S. Congress that it intends to renegotiate the terms of the North American Free Trade Agreement (NAFTA) between the United States, Mexico and Canada.  The move initiates a 90-day waiting period before actual negotiations may begin, during which business groups can provide their input on the pact and the U.S. negotiating team may draw up its objectives and strategy for the talks with Mexico and Canada.  U.S. President Donald Trump has called NAFTA “the worst deal in history” and “a disaster” and threatened to unilaterally withdraw the United States from the accord, however in recent weeks he has toned down his statements and backed renegotiation rather than withdrawal.  Mexico is strongly in favor of maintaining the NAFTA agreement, and facing the prospect of cancellation of the pact, has embraced the negotiations. Continue reading U.S. triggers 90-day waiting period for NAFTA negotiations

Cross-border families facing acute uncertainty

No me llames frijolero
No me llames frijolero

Since the election of Donald Trump as President of the United States, concern over how this will affect Mexico has vaulted to the forefront of public debate on this side of the border.  We worry about all the new problems we (probably? maybe?) will have from topics on the table such as NAFTA repeal, mass deportations, the border wall, etc. We wring our hands publicly about the plight of Mexican migrants in the USA, but mostly we’re thinking about what will become of us here at home.  For this reason, we asked a colleague based in the United States to provide us some perspective from north of the border, particularly with regard to the impact on binational families such as his.  Journalist Steve Cannon lived in Mexico City for many years before moving to the United States with his family in 2016.  As a family including both U.S. and Mexico passport holders – of which there are many in both countries – the Cannons now face challenges and uncertainty that may not have seemed apparent before last November’s presidential election.  Mexico Business Blog greatly appreciates the thoughts that Steve has shared with us, which follow below. Continue reading Cross-border families facing acute uncertainty