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    How West Africa Can Reap More Profit From the Global Chocolate Market

    Resource-rich countries like Ghana are often cut out of lucrative parts of the business like manufacturing. The “fairchain movement” wants to change that.The first leg of the 35-mile journey from Ghana’s capital city, Accra, to the Fairafric chocolate factory in Amanase on the N6 highway is a quick ride. But after about 30 minutes, the smoothly paved road devolves into a dirt expanse without lanes. Lumbering trucks, packed commuter minivans, cars and motorcycles crawl along craggy, rutted stretches bordered by concrete dividers, muddy patches and heaps of rock.The stopgap roadway infrastructure is one of the challenges Fairafric has had to navigate to build a factory in this West African country. The area had no fiber-optic connection to Ghana’s telecommunications network. No local banks were interested in lending the company money. And it required the personal intervention of Ghana’s president before construction could even begin in 2020.The global chocolate industry is a multibillion-dollar confection, and Africa grows 70 percent of the world’s raw cocoa beans. But it produces only 1 percent of the chocolate — missing out on a part of the business that generates the biggest returns and is dominated by American and European multinationals.The Fairafric chocolate factory powered by solar energy in Amanase, Ghana. The company aims to create stable, well-paying jobs.Francis Kokoroko for The New York TimesCapturing a bigger share of the profits generated by chocolate sales and keeping them in Ghana — the second-largest cocoa exporter behind Ivory Coast — is the animating vision behind Fairafric. The aim is to manufacture the chocolate and create stable, well-paying jobs in the place where farmers grow the cocoa.Many developing countries are lucky to have large reserves of natural resources. In Ghana, it’s cocoa. In Botswana, it’s diamonds. In Nigeria and Azerbaijan, it’s oil. But the commodity blessing can become a curse when the sector sucks up an outsize share of labor and capital, which in turn hampers the economy from diversifying and stunts long-term growth.“Look at the structure of the economy,” Aurelien Kruse, the lead country economist in the Accra office of the World Bank, said of Ghana. “It’s not an economy that has diversified fully.”The dependency on commodities can lead to boom-and-bust cycles because their prices swing with changes in supply and demand. And without other sectors to rely on during a downturn — like manufacturing or tech services — these economies can crash.“Prices are very volatile,” said Joseph E. Stiglitz, a former chief economist at the World Bank. In developing nations dependent on commodities, economic instability is built into the system.Workers making the chocolate products. By keeping manufacturing in Ghana, Fairafric supports other local businesses.Francis Kokoroko for The New York TimesA batch of chocolate bars being inspected . . .Francis Kokoroko for The New York Times. . . and packaged at the Fairafric chocolate factory.Francis Kokoroko for The New York TimesBut creating industrial capacity is exceedingly difficult in a place like Ghana. Outside large cities, reliable electricity, water and sanitation systems may need to be set up. The suppliers, skilled workers, and necessary technology and equipment may not be readily available. And start-ups may not initially produce enough volume for export to pay for expensive shipping costs.Fairafric might not have succeeded if its founder and chief executive — a German social-minded entrepreneur named Hendrik Reimers — had not upended the status quo.The pattern of exporting cheap raw materials to richer countries that use them to manufacture valuable finished goods is a hangover from colonial days. Growing and harvesting cocoa is the lowest-paid link in the chocolate value chain. The result is that farmers receive a mere 5 or 6 percent of what a chocolate bar sells for in Paris, Chicago or Tokyo.Mr. Reimers’s goal is aligned with the “fairchain movement,” which argues that the entire production process should be in the country that produces the raw materials.The idea is to create a profitable company and distribute the gains more equitably — among farmers, factory workers and small investors in Ghana. By keeping manufacturing at home, Fairafric supports other local businesses, like the paper company that supplies the chocolate wrappers. It also helps to build infrastructure. Now that Fairafric has installed the fiber optic connections in this rural area, other start-up businesses can plug in.Cocoa pods harvested in a cocoa farm in Ghana.Francis Kokoroko/ReutersA worker from Fairafric chocolate factory visiting a cocoa farm in the Budu community.Francis Kokoroko for The New York TimesThe last few years have severely tested the strategy. Ghana’s economy was punched by the coronavirus pandemic. Russia’s invasion of Ukraine fueled a rapid increase in food, energy and fertilizer prices. Rising inflation prompted the Federal Reserve and other central banks to raise interest rates.In Ghana, the global headwinds exacerbated problems that stemmed from years of excessive government spending and borrowing.As inflation climbed, reaching a peak of 54 percent, Ghana’s central bank raised interest rates. They are now at 30 percent. Meanwhile, the value of the currency, the cedi, tumbled against the dollar, more than halving the purchasing power of consumers and businesses.At the end of last year, Ghana defaulted on its foreign loans and turned to the International Monetary Fund for emergency relief.“The economic situation of the country has not made it easy,” said Frederick Affum, Fairafric’s accounting manager. “Every kind of funding that we have had has been outside the country.”Even before the national default, Ghana’s local banks were drawn to the high interest rates the government was offering to attract investors wary of its outsize debt. As a result, the banks were reluctant to invest in local businesses. They “didn’t take the risk of investing in the real economy,” said Mavis Owusu-Gyamfi, the executive vice president of the African Center for Economic Transformation in Accra.“The economic situation of the country has not made it easy,” said Frederick Affum, accounting manager at Fairafric.Francis Kokoroko for The New York TimesFairafric started with a crowdsourced fund-raising campaign in 2015. A family-owned chocolate company in Germany bought a stake in 2019 and turned Fairafric into a subsidiary.In 2020, a low-interest loan of 2 million euros from a German development bank that supports investments in Africa by European companies was crucial to getting the venture off the ground.Then the pandemic hit, and President Nana Akufo-Addo closed Ghana’s borders and suspended international commercial flights. The shutdown meant that a team of German and Swiss engineers who had been overseeing construction of a solar-powered Fairafric factory in Amanase could not enter the country.So Michael Marmon-Halm, Fairafric’s managing director, wrote a letter to the president appealing for help.“He opened the airport,” Mr. Marmon-Halm said. “This company received the most critical assistance at the most critical moment.”Both Ghana and Ivory Coast, which account for 60 percent of the world cocoa market, have moved to raise the minimum price of cocoa and expand processing inside their borders.In Ghana, the government created a free zone that gives factories a tax break if they export most of their product. And this month, Mr. Akufo-Addo announced an increase in the minimum price that buyers must pay farmers next season.Cocoa pods at a cocoa farm in the Budu community . . .Francis Kokoroko for The New York Times. . . which reveal a pulpy white bean when cracked open.Francis Kokoroko for The New York TimesFairafric, which buys beans from roughly 70 small farmers in the eastern region of Ghana, goes further, paying a premium for its organically grown beans — an additional $600 per ton above the global market price.Farmers harvest the ripe yellow pods by hand, and then crack them open with a cutlass, or thick stick. The pulpy white beans are stacked under plantain leaves to ferment for a week before they are dried in the sun.On the edge of a cocoa farm in Budu, a few minutes from the factory, a bare-bones, open-sided concrete shed with wooden benches and rectangular blackboards houses the school. Attendance is down, the principal said, because the school has not been included in the government’s free school feeding program.The factory employs 95 people. They have health insurance and are paid above the minimum wage. Salaries are pegged to the dollar to protect against currency fluctuations. Because of spotty transportation networks, the company set up a free commuter van for workers. Fairafric also installed a free canteen so all the factory shifts can eat breakfast, lunch or dinner on site.Mr. Marmon-Halm said the company was looking to raise an additional $1 million to expand. He noted that the chocolate industry generated an enormous amount of wealth.But “if you want to get the full benefit,” he said, “you have to go beyond just selling beans.”Students by a stream in the Budu community, a cocoa farming village.Francis Kokoroko for The New York Times More

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    Pork Industry Grapples With Whiplash of Shifting Regulations

    Retailers in California, and pig farmers and processors thousands of miles away, are bracing for the impact of a state ban on some sources of the meat.These were supposed to be boom times for Pederson’s Natural Farms.In the days this spring after the Supreme Court upheld a California law banning the sale of certain pork products made from pigs raised in small gestation pens, the phones were ringing off the hook at Pederson’s headquarters in Hamilton, Texas.California grocery stores and restaurants were desperate to line up supplies of bacon and pork chops that met the new state standards by a July 1 deadline. Pederson’s products filled the bill, and the company was happy to help send them to California, which consumes about 15 percent of the nation’s pork.“We were going to have a good year,” said Neil Dudley, the vice president at Pederson’s. “We were putting it in the budget. We were going to put pressure on us to grow, but the extra income would help fund that growth.”But a couple of weeks later, some of those new orders were canceled as California regulators pushed back the full force of the law, known as Proposition 12, to early next year, allowing grocery stores and restaurants to use up pork they had already boughtBrined pork bellies ready for removal from a vacuum tumbler and then hanging in a smoker at Pederson’s.Tamir Kalifa for The New York Times“We were going to have a good year,” said Neil Dudley, a Pederson’s executive. Then California pushed back its timeline, and some orders were canceled.Tamir Kalifa for The New York TimesThe normally orderly pork industry has been thrown into upheaval as pig farmers in the Midwest, major pork processors and California businesses have reacted to the changing legal and regulatory landscape in recent months. Further confusion could come if Congress passes pending legislation that would effectively nullify the California act.“There is so much murky water here,” said Todd Davis, the meat and seafood coordinator for Oliver’s Markets, which operates four grocery stores in Sonoma County, Calif., and has lined up pork products that meet the new state requirements.“You are supposed to be compliant as of July 1, but I don’t think the state has any teeth on the enforcement side of things,” Mr. Davis continued. “Companies aren’t taking it as seriously as they should, and at some point the state will make an example out of one of them,” which he said could include costly fines.Already, farmers are facing hog prices that have been depressed since fall while feed costs have remained high, leading to average losses of $30 to $50 a hog for much of this year in Iowa, according to estimated livestock returns from Iowa State University. A pound of bacon costs an average of $6.20 at grocery stores across the country, down from $7.60 last fall, according to data from the Federal Reserve Bank at St. Louis.Nationally, pork prices are influenced by everything from feed cost to demand from China to the shifting mood in commodities markets, but some retailers are already raising prices in California, to pass on the higher cost to hog farmers of meeting the state’s more stringent standards. With other farmers opting not sell in the state, short supply could also push the prices of bacon and pork chops higher.Piglets are kept with their sows at A-Frame Acres in Elliott, Iowa, which is part of the Niman Ranch network.Rachel Mummey for The New York TimesFeeding time at A-Frame Acres, which is run by Ron Mardesen, above.Rachel Mummey for The New York TimesPig farmers say making changes for California is costly. Along with his partners, Dwight Mogler, a fourth-generation farmer in Iowa who sells about 200,000 hogs each year, spent $8.7 million in 2022 building a new facility and modifying an existing one to meet the new standards. A packing company pays him a small premium over market price for his pigs — he declined to provide details of the deal — but Mr. Mogler estimates that it will take 10 years to recoup his outlay.Other farmers say they’re simply not going to modify how they raise pigs.“We’re losing money in the pig industry,” said Trish Cook, the president of the Iowa Pork Producers Association, who, along with her family, raises pigs near Winthrop in eastern Iowa. “The idea of having a large capital expenditure with no clear payback on it doesn’t make business sense to us. We don’t know what sort of premium those pigs will get.”For California, questions about whether consumers will have enough bacon and pork chops and how much they will cost also remain unclear.Ronald Fong, the chief executive of the California Grocers Association, which pushed for an extension of the deadline, said stores were able to make it through Labor Day with the product that they had already bought. However, Mr. Fong said that soon “we’ll be faced with some shortages and price hikes.”Mr. Davis of Oliver’s Markets said he already bought pork from Niman Ranch, a producer that exceeds the California criteria, but had also always offered customers less-expensive pork options. Now, the cheaper pork that meets the new state criteria, from Open Prairie Natural Meats, a brand owned by Tyson, costs Oliver’s $1 to $1.50 a pound more, which Mr. Davis is passing along to customers, he said.“Chicken and pork are still very affordable options, especially when compared to beef prices,” Mr. Davis said. “So we’ve seen very little pushback from consumers.”Loading brined pork bellies into the smokehouse at Pederson’s.Tamir Kalifa for The New York TimesWhen voters passed Proposition 12 five years ago, it was a blow to the industrial meat producers, requiring that any veal calves, breeding pigs and egg-laying hens sold in California be housed in systems that allow freedom of movement. Under the rule, pigs must be born to sows housed in spaces that provide at least 24 square feet per sow. California produces very few of its own pigs, but the new rule also applies to pigs raised in other states.The law was supposed to go into effect in 2022, but the new pork standards were put on pause after the National Pork Producers Council and American Farm Bureau Federation filed a lawsuit challenging California’s ability to dictate pig operations in other states. They argued that if other states adopted different restrictions, the result would be a patchwork of rules and regulations. Massachusetts, for instance, passed its own gestation pen rule, called Question 3, in 2016, but it has been on hold, awaiting various court proceedings.In May, the Supreme Court ruled 5 to 4 that Proposition 12 was legal. It said the pork industry had not proved that the law imposed a substantial burden on interstate commerce. California officials began working through how to regulate and enforce the rule, but a state court delayed enforcement until the end of the year.And the pork industry isn’t done fighting. In June, senators from largely agricultural Midwestern states introduced the Ending Agricultural Trade Suppression Act, which would limit the ability of states to regulate agriculture in other states.In early August, attorneys general from several states, including Texas, New Hampshire and Utah, signed a letter urging Congress to pass the EATS Act.“The industry lost in the court of public opinion in terms of California voters adopting this law, they lost in the courts, and now they’re trying to get something through with this legislative act,” said Chris Oliviero, the general manager of Niman Ranch, which pays its network of 600 farmers in 20 states premium prices to raise the beef, pork and lamb used in its products in conditions that exceed the California standards.“The ultimate goal is to prevent Prop. 12 from going into effect,” Mr. Oliviero added.Bacon slabs cooling after being smoked at Pederson’s.Tamir Kalifa for The New York TimesAs for Pederson’s, much of the pork it produces is already committed to a handful of longtime customers, including Whole Foods. The company did, however, have excess bacon that met the new standards.That is, until one of the farmers who supplied half of the pigs used by Pederson’s received a better offer from a larger company. Suddenly, Pederson’s pig supply was at risk.“Farmers, who are struggling to make money, are getting calls from the big guys, saying they want to contract with them,” Mr. Dudley said. “The big players can’t lose market share, not in a market as big as California. Instead of a boom year, we’re now looking at diminishing sales.” More

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    Russian Attack Threatens Even Alternative Routes for Ukrainian Grain

    The attack on a grain hangar on the Danube River, an alternative export route that has become an economic lifeline, complicates Ukraine’s efforts to export its grain.For shipping companies looking for a way to bring Ukrainian grain to global markets, the options keep dwindling, escalating a trade crisis that is expected to add pressure on global food prices.Russia last week pulled out of an agreement that had allowed for the safe passage of vessels through the Black Sea. On Monday it threatened an alternative route for grain, attacking a grain hangar at a Ukrainian port on the Danube River that has served as a key artery for transporting goods while the Black Sea remains blockaded. “It’s opening a new front in the targeting of Ukrainian grain exports,” said Alexis Ellender, an analyst at Kpler, a commodities analytics firm, adding that the route had been considered safe because of its proximity to Romania, a NATO member.“This will potentially close off that route,” he said. It could also raise rates for shipping insurance and further cripple Ukraine’s ability to export grain.Hours after the predawn attack on the hangar at the Ukrainian port of Reni, dozens of vessels that had been bound to collect grain from Ukraine were clustered at the mouth of the Danube. More

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    Wheat Prices Remain High as Concern Grows About Black Sea Instability

    As Black Sea-bound vessels clustered in the waters near Istanbul, wheat prices remained elevated on Thursday, up 13 percent since Monday, when Russia pulled out of a wartime agreement that had been considered critical to stabilizing global food prices.The termination of the deal, which had permitted Ukraine to safely export its grain through the Black Sea, could have significant long-term consequences for grain supplies, said Alexis Ellender, a global analyst at Kpler, a commodities analytics firm. Despite robust grain harvests from exporters including Brazil and Australia, prices could become volatile.“By not having Ukraine there as a supplier, we’re increasing the vulnerability of the global grain market to these shocks,” Mr. Ellender said. “In the short term, supplies are good, but longer term, if we get any more supply shocks, we’re more vulnerable in terms of the global market.”Another drought in Brazil, like in 2021, or a disruption to Australia’s barley and wheat crop caused by El Niño, could cause prices to soar, he said.Russian threats to attack commercial vessels heading to Ukrainian ports have stalled traffic in the area. Marine tracking data shows that ships that had been en route to the Black Sea are sitting in ports in Istanbul as they wait to see if an agreement could be hammered out.“They’re still deciding what they’re going to do,” he said. Some vessels could look to pick up shipments of grain from other parts of Europe.At the moment, a quick resolution looks unlikely. Russia bombarded the port city of Odesa with missiles and drones on Tuesday and Wednesday, after an apparent Ukrainian drone strike on a Russian bridge linking the occupied Crimean Peninsula to mainland Russia.The suspension of the deal between Russia and Ukraine also has implications for maritime insurers and shipowners, who will no longer have insurance coverage to travel to Ukrainian ports, said James Whitlam, a product director at Concirrus, a marine data and analytics platform. While the deal between Russia and Ukraine was in effect, ships were able to secure insurance coverage under a temporary agreement.“Insurance markets are now scrambling around trying to understand what exposure they have,” Mr. Whitlam said.Despite recent increases, grain prices are still lower than they were on the eve of Russia’s invasion of Ukraine in February 2022, partly because the end of the deal was expected, Mr. Ellender said. In addition, Ukrainian grain exports have recently been at reduced levels because of limited labor, with workers fighting the war, and limited fuel supplies and lost territory to Russia.Ukraine has also increased exports by truck, train and river barge.Ukraine is still likely to be able to export most of its wheat, corn, barley and sunflower seeds via alternative routes, said Rabobank, a Dutch bank, on Thursday. But this will put additional pressure on ports on the Danube River, which flows from the Black Forest in Germany to the Black Sea, and the cost of transport will become more expensive, and rail infrastructure will be at a higher risk of Russian attack, the note said.“The higher transport cost means that Ukrainian farmers may, quite possibly, reduce planted area in the future,” the note said.Ukraine is one of the leading exporters of grain and the leading global exporter of sunflower oil, and the deal had allowed Ukraine to restart the export of millions of tons of grain that dropped after the invasion.Ukraine has exported 32.9 million metric tons of grain and other agricultural products to 45 countries since the initiative began, according to United Nations data. Under the agreement, ships had been permitted to pass by Russian naval vessels that had blockaded Ukraine’s ports in the aftermath of Russia’s full-scale invasion.Soaring prices are expected to hit the poorest people in the world the hardest. Ukraine last year had supplied more than half of the World Food Program’s wheat grain sent to people in Afghanistan, Ethiopia, Kenya, Somalia, Sudan, and Yemen, according to the U.N. More

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    Ukraine Grain Deal Raises Tensions for European Farmers

    When Russia’s war blocked vitally needed grains at Ukrainian ports, officials succeeded in finding other routes out. But the solution brought its own problems.In Britain, food prices were up 19 percent last month from the previous year. In Spain, farmers are worried that a lack of rainfall will irreversibly damage wheat and barley production. And in West and Central Africa, record numbers of people are facing potentially dire food shortages.Nonetheless, a handful of European nations including Poland and Hungary have blocked the entry of farm products from Ukraine — one of the world’s biggest grain exporters — arguing that the flood of cheap imports is ruining local farmers. Now, to quell the rising discord, the European Union is considering a temporary ban on grain imports to five nations.The combination of spiraling prices for consumers in one part of the world and plummeting incomes for farmers in another illustrates the maddening complexities of the global food market.Long before Russia’s invasion of Ukraine last year, climate change, violent conflicts, supply-chain bottlenecks related to the pandemic and burdensome debts were contributing to food shortages and hunger around the world. But the war in Ukraine threatened to seriously worsen the crisis by reducing the country’s grain exports and driving up food and fertilizer prices.With sea shipments from Ukrainian ports blocked or restricted by Russian forces, the European Union suspended tariffs and quotas on food from Ukraine and rushed to transport as much as possible by rail and truck through neighboring countries. The idea was to create an alternate pathway that would funnel grain from Ukraine’s breadbasket to the Middle East, Africa and parts of Asia, where it was most needed.The plan worked, at least to some degree, easing anxieties over shortages. Food prices have dropped by more than 20 percent from a peak in March 2022, according to a food price index calculated by the United Nations Food and Agriculture Organization.Much of the Ukrainian grain was getting to far-off markets by traveling through Poland, Romania, Slovakia and Hungary, as well as Bulgaria — but not all of it. And that is what has set off the tensions.“Enough makes its way to local markets, and makes it more difficult for European farmers to get the price they want,” said Monika Tothova, an economist with the United Nations Food and Agriculture Organization.Trucks were lined up for more than 10 kilometers at the Ukrainian-Polish border on Tuesday.Yuriy Dyachyshyn/Agence France-Presse — Getty ImagesThe uproar in rural areas has created political headaches for government leaders.With a national election coming up in Poland, which has been one of Ukraine’s staunchest allies, Prime Minister Mateusz Morawiecki last week imposed a unilateral ban on Ukrainian grain and certain other farm imports, a violation of European Union rules.As early as last summer, some farmers in Romania were complaining about the glut of Ukrainian grain, saying it had pushed down prices for their own products at a time when the costs of fuel, pesticides and fertilizer were rising.Hoping to dampen the growing internal discord, the European Union promised on Wednesday to offer “comprehensive proposals” to address the concerns of the five Eastern and Central European countries and provide 100 million euros ($110 million) to compensate farmers.On Thursday, an E.U. official confirmed that one of the measures under consideration was a temporary ban on certain Ukrainian food exports to Bulgaria, Hungary, Poland, Romania and Slovakia, if those five countries canceled any unilateral measures.It was not clear if the countries would all go along with the plan, which some European officials said did not go far enough.“We have to expand this product range,” the Hungarian agriculture minister, Istvan Nagy, wrote on Facebook late Wednesday, adding, “We must also apply restrictions on eggs, poultry and honey” coming in from Ukraine.The prohibitions on Ukrainian grain to neighboring countries come at the same time that Russia is threatening to back out of a deal brokered by the United Nations and Turkey to allow grain shipments to leave Ukraine’s Black Sea ports. That deal is set to expire on May 18, although talks about an extension are continuing.Even with the deal in place, though, passage through the Bosporus in Turkey is slow, uneven and expensive. Ukraine is already harvesting 40 percent less than it did before the war. High shipping fees add to the costs and may cause farmers to plant even less next year, and in turn further reduce food production.“There is no global food crisis,” Ms. Tothova said. “There are many crises in different countries. The problem last year was a problem of access. Grain was available but many did not have enough resources to buy it.”Even as Europe’s leaders skirmished over Ukrainian grain, Ukraine itself was given encouragement on Thursday that it would eventually be accepted into the European military fold.On a visit to Kyiv — his first since the Russian invasion over a year ago — Jens Stoltenberg, the secretary general of NATO, said Ukraine’s “rightful place” was in the alliance.“I am here today with a simple message: NATO stands with Ukraine,” Mr. Stoltenberg said at a news conference with the Ukrainian president, Volodymyr Zelensky. Mr. Stoltenberg said the issue of Ukraine’s NATO membership would be “high on the agenda” at a NATO summit in Lithuania in July.Though Ukraine is not a member of NATO, the alliance has helped coordinate its requests for nonlethal assistance and supports deliveries of humanitarian aid. And some NATO members have provided major military assistance to help Ukraine fend off Russian forces.Even those NATO members who are open to the entry of Ukraine have made it clear that it is a long-term goal.But Mr. Zelensky, who has been invited to attend the NATO summit, said it was important that Ukraine be invited to join the alliance.“There is no objective barrier to the political decision to invite Ukraine into the alliance,” he said.On Thursday, Mr. Zelensky also tried to win over lawmakers from Mexico, which has said little publicly about the Russian invasion.“Ukrainians and Mexicans hurt equally when we see innocent lives taken by cruel violence, where true peace could reign,” he said, addressing them remotely.The Ukrainian president has spoken to dozens of legislatures over the past year, often using the occasions to ask for military aid. But speaking to the Mexican lawmakers, Mr. Zelensky seemed content just to ask for their support.Victoria Kim More

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    Biden Warns That Climate Change Could Upend Federal Spending Programs

    A chapter in the new Economic Report of the President focuses on the growing risks to people and businesses from rising temperatures, and the government’s role in adapting to them.WASHINGTON — The Biden administration warned on Monday that a warming planet posed severe economic challenges for the United States, which would require the federal government to reassess its spending priorities and how it influenced behavior.Administration economists, in an annual report, said that reassessment should include a new look at the climate-adaptation implications of aid to farmers, wildland firefighting and wide swaths of safety-net programs like Medicaid and Medicare, as the government seeks to shield the poorest Americans from suffering the worst effects of climate change.The White House Council of Economic Advisers also warned that, left unchanged, federal policies like fighting forest fires and subsidizing crop insurance for farmers could continue to encourage Americans to live and work in areas at high risk of damage from warming temperatures and extreme weather — effectively forcing taxpayers across the country to pay for increasingly costly choices by people and businesses.The findings were contained in a chapter of the annual Economic Report of the President, which was released on Monday afternoon and this year focused on long-run challenges to the U.S. economy. They came on a day when the Intergovernmental Panel on Climate Change, a body of experts convened by the United Nations, reported that Earth was barreling quickly toward a level of warming that would make it significantly more difficult for humans to manage drought, heat waves and other climate-related disasters.The White House report details evidence showing the United States is more vulnerable to the costs of extreme weather events than previously thought, while suggesting a series of policy shifts to ensure the poorest Americans do not foot the bill.“Climate change is here,” Cecilia Rouse, the departing chair of the Council of Economic Advisers, said in an interview. “And as we move forward, we’re going to have to be adapting to it and ensuring that we minimize the cost to families and businesses and others.”The report broadly suggests that climate change has upended the concept of risk in all corners of the American economy, distorting markets in ways that companies, people and policymakers have not fully kept up with. It also suggests that the federal government will be left with significantly higher costs in the future if it does not better identify those risks and correct those market distortions — like paying more to provide health care for victims of heat stroke or to rebuild coastal homes flooded in hurricanes.State and local officials, not the federal government, have authority where development happens, so people keep building in high-risk areas, a classic example of what economists call a moral hazard.Johnny Milano for The New York TimesFor example, the report cites evidence that private mortgage lenders are already offloading loans with a high exposure of climate risk to federally backed Fannie Mae and Freddie Mac. It highlights how the federal flood insurance program, which essentially underwrites all home flooding insurance policies in the country, is at risk of insolvency.At a time when administration officials and the Federal Reserve are struggling to stabilize the nation’s financial system, the report warns that home buyers and corporate investors appear to be underestimating climate-related risks in their markets, which could lead to a financial crisis.“Rapid changes in asset prices or reassessments of the risks in response to a shifting climate could produce volatility and cascading instability in financial markets if not anticipated by regulators,” the report says..css-1v2n82w{max-width:600px;width:calc(100% – 40px);margin-top:20px;margin-bottom:25px;height:auto;margin-left:auto;margin-right:auto;font-family:nyt-franklin;color:var(–color-content-secondary,#363636);}@media only screen and (max-width:480px){.css-1v2n82w{margin-left:20px;margin-right:20px;}}@media only screen and (min-width:1024px){.css-1v2n82w{width:600px;}}.css-161d8zr{width:40px;margin-bottom:18px;text-align:left;margin-left:0;color:var(–color-content-primary,#121212);border:1px solid var(–color-content-primary,#121212);}@media only screen and (max-width:480px){.css-161d8zr{width:30px;margin-bottom:15px;}}.css-tjtq43{line-height:25px;}@media only screen and (max-width:480px){.css-tjtq43{line-height:24px;}}.css-x1k33h{font-family:nyt-cheltenham;font-size:19px;font-weight:700;line-height:25px;}.css-1hvpcve{font-size:17px;font-weight:300;line-height:25px;}.css-1hvpcve em{font-style:italic;}.css-1hvpcve strong{font-weight:bold;}.css-1hvpcve a{font-weight:500;color:var(–color-content-secondary,#363636);}.css-1c013uz{margin-top:18px;margin-bottom:22px;}@media only screen and (max-width:480px){.css-1c013uz{font-size:14px;margin-top:15px;margin-bottom:20px;}}.css-1c013uz a{color:var(–color-signal-editorial,#326891);-webkit-text-decoration:underline;text-decoration:underline;font-weight:500;font-size:16px;}@media only screen and (max-width:480px){.css-1c013uz a{font-size:13px;}}.css-1c013uz a:hover{-webkit-text-decoration:none;text-decoration:none;}How Times reporters cover politics. We rely on our journalists to be independent observers. So while Times staff members may vote, they are not allowed to endorse or campaign for candidates or political causes. This includes participating in marches or rallies in support of a movement or giving money to, or raising money for, any political candidate or election cause.Learn more about our process.To address those dangers, the report offers components for a federal climate adaptation strategy. Its recommendations — some of them already in early stages through existing administration actions — include producing better information about climate risk, helping financial markets accurately price that risk and better protecting the most vulnerable from the effects of climate change.Perhaps the most significant proposal, and probably the most politically sensitive, is a call for Washington to exert more pressure on state and local officials, pushing them to be careful about where and how they let people build homes, businesses and infrastructure projects.That proposal would address a core problem that has hindered America’s efforts to adapt to climate change. When people build in places that are most exposed to the effects of climate change — along coastlines, near riverbanks, at the edge of forests prone to wildfires — state and local governments get most of the benefits, in the form of higher tax revenues and economic growth. But when flooding, fires or other major disasters happen, the federal government typically pays the bulk of the cost for responding and rebuilding.Yet for the most part, state and local officials, not the federal government, have authority over where and how development happens — so people keep building in high-risk areas, a classic example of what economists, including the authors of the report, call a moral hazard.In response, the document proposes using federal funds to change the behavior of state and local officials, by tying that money to state and local decisions. That approach has been tried before, with little success. In 2016, the Obama administration suggested adjusting the level of disaster aid provided to states, based on what steps they took to reduce their exposure to disasters. States objected, and the change never happened.Subsidizing crop insurance for farmers could continue to encourage Americans to work in areas at high risk of damage from warming temperatures and extreme weather, the Biden administration will warn.Mark Abramson for The New York TimesAdministration officials said they were already trying to leverage some spending from the infrastructure law President Biden signed in 2021 to influence state and local behavior. The report suggests much more aggressive action could be necessary.It also proposes a rethinking of the nation’s system of insuring against disasters — moving away from separate localized policies that cover fire, flooding and other events, and more toward a nationally mandated “multiperil catastrophe insurance” system that is backstopped by the federal government.Perhaps most sobering for Washington’s current fiscal moment — when Mr. Biden is battling with House Republicans who are seeking sharp cuts to federal spending and raising anew concerns over the growing national debt — is the report’s suggestion that climate effects could subject growing numbers of Americans to heat stroke, respiratory illnesses and other ailments in the years to come. That could further drive up government costs for health programs like Medicare and Medicaid.The Council of Economic Advisers has begun a yearslong effort to project those climate-related effects on future federal budgets, which it detailed in a highly technical paper released this month.The report released on Monday also included chapters on the economics of child care, higher education, digital assets and more.In reviewing Mr. Biden’s economic record, White House economists dived deep into the issue that has bedeviled the recovery on his watch: persistently high inflation. The report lists several explanations for why price growth has surprised administration and outside economists over the last two years but never settles on a primary driver. It does concede that pandemic relief spending under Mr. Biden and President Donald J. Trump may have played a role, by helping Americans save more than usual — and then begin to spend that extra savings.“If the drawdown of excess savings, with current income, boosted aggregate demand, it could have contributed to high inflation in 2021 and 2022,” the report says. More

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    Can the United Farm Workers of California Rise Again?

    Veronica Mota marched under the sweltering sun, hoisting a cloth banner of Our Lady of Guadalupe above her head for miles.“Sí, se puede,” she chanted in unison with dozens of other farmworkers, who waved U.S. and Mexican flags as they walked along two-lane roads lined by dense orange groves in the Central Valley of California.The banner, flags and rallying cry — “Yes, we can” — echoed back more than half a century to when Cesar Chavez, a co-founder of the United Farm Workers union, led agricultural workers on a pilgrimage along a similar route to meet lawmakers in Sacramento.“We are a legacy of Cesar Chavez,” said Ms. Mota, 47, who, when blisters began to form on her feet during the 24-day trek in August, gathered strength by thinking of how the march in the 1960s led to groundbreaking farmworker reforms and propelled the U.F.W. to national prominence.“We can achieve what we want,” Ms. Mota said.What the farmworkers wanted last summer was for Gov. Gavin Newsom to sign into law a bill that they argued would make it easier and less intimidating for workers to vote in union elections — a key step, they believed, in rebuilding the size and influence of a now far less prolific U.F.W. But changing a rule is not the same as changing the game. The question now is whether the U.F.W. can show it has not irretrievably lost its organizing touch and can regain the ability to mobilize public opinion on its behalf as it did under Mr. Chavez.The union is a shadow of what it was decades ago. Membership hovers around 5,500 farmworkers, less than 2 percent of the state’s agricultural work force, compared with 60,000 in the 1970s. In the same period, the number of growers covered by U.F.W. contracts has fallen to 22 from about 150. The march last summer stood as a reckoning of sorts for a union desperate to regain its relevance.California’s fields provide about half of the produce grown in the United States for domestic consumption.Mark Abramson for The New York TimesFarmworkers at an orange grove outside Fresno.Mark Abramson for The New York TimesU.F.W. officials say they have secured contracts focusing on health coverage.Mark Abramson for The New York TimesLabor organizing has rebounded nationwide in the last few years, with unions winning elections at an Amazon warehouse on Staten Island and at least 275 Starbucks stores, and among white-collar workers in the tech and media industries. But in California’s fields, which supply about half of the produce grown in the United States for the domestic market, such efforts have found little traction.It has been more than five years since the U.F.W. mounted an organizing drive and election petition in the state — at Premiere Raspberries in Watsonville. The U.F.W. unionization vote succeeded, but the company refused to negotiate a contract and in 2020 announced plans to shut down and lay off more than 300 workers.Ms. Mota, who has worked seasonal jobs around the state for two decades, has seen her wages drop by about $6,000 over the last several years. She is now earning around $15,000 a year. She said that on farms without union contracts, bosses sometimes make veiled threats about cutting hours, refuse to give workers breaks in 100-plus degree weather and turn a blind eye to dangerous conditions.“Where we do not have a union contract, there is no respect,” she said in Spanish on a recent morning from her ranch-style home in the farming town of Madera.But the bill backed by Ms. Mota, which Mr. Newsom signed into law after the marchers arrived in Sacramento, has fueled a cautious optimism. Backers say the ability to more freely organize will help them gain more influence.“There is new energy, new legislation and attention from the public in terms of workers’ rights,” said Christian Paiz, a professor of ethnic studies at the University of California, Berkeley, who has researched farm labor in the state. “We could be on the front lines of a renaissance.”The Shadow of Cesar ChavezFarmworkers have, for generations and by design, existed on the fringes of the American work force.The National Labor Relations Act of 1935 excluded farm and domestic workers from federal protections — a decision, rooted in racism, that ensured that the Black, Latino and Asian people whose work opportunities were largely limited to those two industries were not covered.But by the 1960s, momentum for change was building.Farm workers on their march from Delano to Sacramento in 1966.Jon Lewis/Beinecke Rare Book and Manuscript Library, Yale UniversityMr. Chavez, who was a farm laborer picking avocados and peas before becoming a grass-roots organizer, teamed up with Dolores Huerta, a young workers’ rights activist from the Central Valley, and in 1962 they founded the National Farm Workers Association. It became the U.F.W.Labor Organizing and Union DrivesA New Inquiry?: A committee led by Senator Bernie Sanders will hold a vote to open an investigation into federal labor law violations by major corporations and subpoena Howard Schultz, the chief executive of Starbucks, as the first witness.Whitney Museum: After more than a year of bargaining, the cultural institution and its employees are moving forward with a deal that will significantly raise pay and improve job security.Mining Strike: Hundreds of coal miners in Alabama have been told by their union that they can start returning to work before a contract deal has been reached, bringing an end to one of the longest mining strikes in U.S. history.Gag Rules: The National Labor Relations Board has ruled that it is generally illegal for companies to offer severance agreements that require confidentiality and nondisparagement.Three years later, it was a key force behind the Delano grape workers’ strike, in which thousands of Mexican and Filipino farmworkers walked off their jobs, demanding raises from $1.25 to $1.40 an hour, as well as elections that could pave the way for unionization.As the striking farmworkers made their way along the 335-mile trek in 1966, which started in Delano, the group grew steadily, and other unions began to pledge their support.In the Bay Area, longshoremen had refused to load shipments of grapes that hadn’t been picked by unionized workers and, before long, a statewide pressure campaign had become a national one.Weeks after the march began, a lawyer for Schenley Industries, a large Central Valley grape grower that was a target of the boycott, contacted Mr. Chavez, and the company soon agreed to negotiate a contract. It officially recognized the U.F.W., making it the first major corporation to acknowledge a farm union.The grape workers’ strike stretched into the summer of 1970, when widespread consumer boycotts forced major growers to sign on to collective bargaining agreements between the union and several thousand workers.In the years that followed, Mr. Chavez forged a relationship with Gov. Jerry Brown, a Democrat, and helped champion the California Agricultural Labor Relations Act of 1975, which established the right to collective bargaining for farmworkers and created a board to enforce the act and arbitrate labor fights between workers and growers. It was the first law in the country guaranteeing protections to farm workers.Cesar Chavez, center, leader of the National Farm Workers Association, outside a farm in 1966, with supporters bearing signs proclaiming “Strike.” The association was a predecessor of the United Farm Workers.Paul Fusco/Magnum PhotosBut the union’s gains soon began to erode. Mr. Brown’s Republican successor, George Deukmejian, and his appointees made changes to the farm labor board in the 1980s and cut funding, arguing that the adjustments were necessary to correct an “easily perceived bias” in favor of farm workers and the U.F.W. and against growers. And even when the union has won elections, it has often faced legal challenges from growers that can drag on for years.The law that Mr. Newsom signed last year, Assembly Bill 2183, was the union’s biggest legislative victory in years. It paved the way for farmworkers to vote in union elections without in-person election sites. For years, U.F.W. officials argued that dwindling membership numbers stemmed from fears about voting in person at sites often held on properties owned by the growers.The bill faced opposition from growers, who contended that the measure would allow union organizers to unfairly influence the process. Mr. Newsom initially voiced reticence, but signed the measure into law after then-House Speaker Nancy Pelosi and President Biden publicly pushed him to do so.“In the state with the largest population of farmworkers, the least we owe them is an easier path to make a free and fair choice to organize a union,” Mr. Biden said at the time.Supporters of the measure highlight how the demographics of farmworkers have changed over the years. In the 1970s, under Mr. Chavez, many farmworkers were U.S. citizens, but migration from Mexico and Central America in the decades that followed created a work force composed primarily of undocumented workers. Because they lack immigration papers, supporters say, they are especially vulnerable. (Undocumented workers can be covered by labor agreements.)In signing the measure, Mr. Newsom and the U.F.W. agreed to support follow-up compromise legislation that would guard farmworker confidentiality during elections and place limits on card-check voting, a method in which employees sign cards in favor of unionizing.‘We Are Ignored’Last summer, as she marched past vineyards and groves of mandarin oranges, Ms. Mota thought of the harvest cycle that has defined much of her life.She reflected on the dormant season, in December and January, when she prunes pistachio and almond trees, and the rainy months, when it’s sometimes hard to find work. But then comes the prosperous citrus and grape harvests, through the spring and the fall, which always make her think of the families who will eventually toast with wine squeezed from the fruit she plucked from the vine.“I love for my hands to harvest a fruit and then seeing those fruits and vegetables in the restaurant,” Ms. Mota said.U.F.W. supporters marched last year to urge Gov. Gavin Newsom to sign a bill that would make it easier for workers to vote in union elections.Jessica Christian/San Francisco Chronicle, via Associated PressShe thought, too, about the invisibility and dangers of her work — the tiny teeth marks etched into her leather boot by a snake bite, the molehill where she badly sprained her ankle, the co-worker airlifted to San Francisco with injuries.“We are ignored,” she said.Still, she didn’t feel that way during the march, where in many towns people greeted them with snacks, Gatorade and full meals. While the group was in Stockton, an inland port city, Ms. Huerta, now 92, stood before the crowd wearing a baseball cap emblazoned with the words, “Sí se puede.”“You all have made me so proud,” she told them.Ms. Huerta, who helped negotiate the first farmworker contract with Schenley, left U.F.W. leadership more than two decades ago to pursue other causes. But in an interview, she said the need for unionization remained as high as it was when she helped start the union.“Farmworkers wanted the support and still want the support,” said Ms. Huerta, who attributed the dearth of contracts to a refusal by growers to bargain in good faith.Despite setbacks in recent decades, U.F.W. officials say they have continued to secure contracts that focus on health care benefits, wage increases and cultivating a respectful culture between farmworkers and employees. At Monterey Mushrooms, which has operated under a contract since the 1980s, U.F.W. officials say the average annual income for a mushroom picker is $45,000 and includes vacation time and a pension. (The statewide average for farmworkers is between $20,000 and $25,000 a year, according to the U.S. Labor Department.)“With a union contract, workers are educated about their rights and empowered to defend them,” said Teresa Romero, the union’s president.Issues might vary from farm to farm, Ms. Romero said. “In one workplace it may be low wages, in another it may be unsafe conditions, in still another it may be the workplace culture — having to pay bribes or endure sexual harassment to get work or having a particular supervisor who is racist or cruel,” she said. “We understand the immense risks that workers are taking when speaking up on the job; it takes courage for workers to form their union.”Dolores Huerta, a founder of the U.F.W., at a rally in the 1970s.Cathy Murphy/Getty ImagesMs. Romero said she was confident that the new state law — along with a streamlined federal process to protect workers involved in labor disputes surrounding immigration threats from employers — would translate into more bargaining power and more contracts.A Question of StrategySome labor watchers are skeptical of the union’s ability to reinvigorate itself.Miriam Pawel, an author who has written extensively about the union and Mr. Chavez, said the U.F.W.’s decline reflected a shortfall in organizing efforts in the communities where farmworkers live.“It’s evolved more into an advocacy organization and walked away from the more difficult work of organizing,” Ms. Pawel said. Referring to the 1975 labor relations act, she added, “They have the most favorable labor law in the country and have barely taken advantage.”Ms. Pawel cited a 2016 state law mandating that agricultural employers pay overtime if people worked more than eight hours in a day. The union lobbied for the measure, but growers warned that they couldn’t afford to pay overtime and would adjust schedules to avoid doing so. The new overtime rule has been phased in over the years, and some farmworkers have voiced anger about losing hours.“If the union were stronger in the fields, and at organizing, it could have won elections and demanded better overtime provisions in contracts,” Ms. Pawel said.Ms. Romero pushed back against such criticism, arguing that, until Mr. Newsom signed A.B. 2183 in September, many farmworkers had justified fears that, if they sought unionization, their bosses would fire them or even try to get them deported.Indeed, a report by the University of California, Merced, Community and Labor Center found that 36 percent of farmworkers said they would not file a report against their employer for failing to comply with workplace safety rules and that 64 percent cited fear of employer retaliation or job loss.And since the bill’s passage, the Farm Employers Labor Service, a trade group that staunchly opposed the law, has placed advertisements on Spanish-language radio stations, warning about what it means to be in a union. In one ad, a man shouts: “Signing a union petition can lead to the union stealing 3 percent of your salary! Do not let them!”Those messages deeply concern Ms. Romero.“Filing for an election when workers are not protected from genuine risks of retaliation will only lead already poor people into further hardship,” she said. “This is the implicit threat that the growers’ power depends on.”‘They Just Want to Work’Joe Del Bosque at his melon farm in Firebaugh, Calif. He has never had a union contract and plans to keep it that way.Mark Abramson for The New York TimesMany California growers say they can be better bosses without unions.On a recent afternoon off Interstate 5 in the small city of Firebaugh, Joe Del Bosque stared out at bare fields on the melon farm he has owned since 1985. A thick fog hung over the area, and the ground was puddled from rain water. It was the quiet season on the farm, where he employs more than 100 farmworkers annually.Mr. Del Bosque said that when he was a boy, his parents, legal U.S. residents, traveled from a town near the California-Mexico border to the Central Valley to pick melons every summer. As a farm owner, he has never had a union contract, and aims to keep it that way.He provides his employees with good conditions and fair wages, he said, without their having to pay union dues. “From my experience, workers who are moving around from season to season do not want the extra hands involved,” he said of the union. “They just want to work.”He said he had little trouble finding field hands, including migrants who move from farm to farm with each season. And he noted that in the Salinas Valley — closer to the coast, where housing is more expensive — many growers rely on H-2A visas, which let them bring workers, often from Mexico, for just a few months of the year.That impermanence, he said, works against the U.F.W. “If the workers are here only a few months a year and then leave the state, how are you going to organize?” he said.Mr. Del Bosque said that he respected the U.F.W.’s history and the groundwork of Mr. Chavez and Ms. Huerta, but that he opposed A.B. 2183. The law, he contends, will allow the U.F.W. to unfairly sway farmworkers at their kitchen tables and behind closed doors.“That’s the intimidation factor,” Mr. Del Bosque said.A New Spirit of ActivismAsuncion Ponce began harvesting grapes in the late 1980s. He says bosses on unionized farms “don’t mess with you.”Mark Abramson for The New York TimesWhile the impact of the law remains unclear, it has buoyed the spirits of some farmworkers.Asuncion Ponce started harvesting grapes along the rolling green hills of the Central Valley in the late 1980s. Through the decades, Mr. Ponce has worked on several farms with U.F.W. contracts. Bosses on those farms, he said, seemed aware that if they harassed or mistreated workers, the union would step in.“They don’t mess with you any more,” he said, “because they think there could be problems.”Even so, he has seen his financial security decline. He averaged $20,000 a year in the 1990s and 2000s, he said, but these days he brings in around $10,000 a year picking grapes and pruning pistachio trees. His eight-hour shifts are no longer supplemented by overtime, as growers have cut hours — partly as a result of the overtime bill U.F.W. leaders supported.Occasionally, Mr. Ponce said, he relied on third-party contractors, who growers sometimes employ, to find him available work. But he said he was optimistic that with the new legislation he would land a full-time job on a union farm.On a recent evening, the 66-year-old sipped coffee and decompressed after a shift at a farm outside of Fresno. His feet ached and his flannel shirt was stained with fertilizer, but he is happy that his job lets him spend all day outdoors — a passion born in his hometown in the Mexican state of Puebla, where he harvested corn and anise.He smiled softly under his white mustache as he spoke about the legacy of Mr. Chavez, which inspired him to join for several legs of the pilgrimage last summer.“I marched for many reasons,” he said in Spanish. “So we are not as harassed and mistreated as we are now in the fields, so benefits and better treatment come our way.”For Ms. Mota, joining the march helped awaken a new spirit of activism.Over the years, she said, she felt afraid to talk about unionizing at work, but now she tells any colleagues who will listen about the advantages she sees: the ability to negotiate a better salary, benefits and a respect for seniority.Her viewpoint was shaped in her early years as a farmworker. “Throughout the years I have realized that we are marginalized,” she said. “They don’t value us.”Once, she said, she watched as a farmer grabbed a knife used to harvest cantaloupe and put it to the cheek of another worker. He glared into the farmworker’s eyes, she said, and called the workers his slaves.“You feel humiliated,” she said, fighting back tears.She is convinced that having a strong union is the only answer. “We deserve a dignified life in this country,” she said.“Throughout the years I have realized that we are marginalized,” Veronica Mota said.Mark Abramson for The New York Times More

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    U.S. to Challenge Mexican Ban on Genetically Modified Corn

    The Biden administration said it would request talks with Mexico over a brewing trade fight.WASHINGTON — The Biden administration said on Monday that it would take initial steps toward challenging a ban that Mexico has placed on shipments of genetically modified corn from the United States, restrictions that have rankled farmers and threatened a profitable export.Mexico has planned to phase out the use of genetically modified corn, as well as an herbicide called glyphosate, by 2024. About 90 percent of corn grown in the United States is genetically modified.Senior administration officials have expressed concerns to the Mexican government about the measures for more than a year in virtual and in-person meetings, saying they could disrupt millions of dollars of agricultural trade and cause serious harm to U.S. producers. Mexico is the second-largest market for U.S. corn, after China.On Monday, U.S. officials said that they were requesting consultations over the issue with their Mexican counterparts under the terms of the United States-Mexico-Canada Agreement, which governs the terms of trade in North America. Biden officials said that parties to that agreement, which was signed in 2020, had committed to basing their regulation on scientific research, and that Mexico’s ban on genetically modified corn did not conform to those promises.The consultations are the first step in a process that could lead to the United States bringing a formal dispute against Mexico. The parties must meet to discuss the issue within 30 days, and, if the talks are not successful, the United States could turn to a separate dispute settlement procedure under the trade agreement. That process could result in the United States placing tariffs on Mexican products, if no other resolution can be reached.Senior officials with the Office of the United States Trade Representative said they were focused on finding a resolution through the talks at hand. But in a statement, the office said that it would “consider all options, including taking formal steps to enforce U.S. rights under the U.S.M.C.A.” if the issue was not resolved.Mexico bought more than 20 million metric tons of corn from the United States in the 2021-22 marketing year, which runs from September to August, according to the U.S. Department of Agriculture.The National Corn Growers Association has said that the impending ban would be “catastrophic” for American corn producers and Mexican consumers alike and undermine the principles of the trade agreement. The industry has maintained that bioengineered corn is safe for human consumption, contrary to health concerns cited by Mexican officials.Scientists, too, widely believe that genetically modified foods are safe, but consumers and Mexican officials remain wary of genetically modified crops.In a statement on Monday, the Mexican Ministry of Economy said its decree was aimed at ensuring that tortillas are made with native Mexican corn varieties, in an effort to ensure the biodiversity of the corn that is grown in the country. It said it would draw on data and evidence to demonstrate that the ban had not had an impact on commerce, and was consistent with the trade agreement.In the United States, the vast majority of corn planted has been bioengineered to be resistant to herbicides and insects. Bt corn, for example, contains a gene from a soil bacterium that kills the European corn borer, an insect that feeds on maize and other grasses.Corn can also be modified to be resistant to glyphosate, the most widely used herbicide in agriculture and lawn maintenance in the United States. Glyphosate-based products like Roundup are sprayed on fields, killing weeds and leaving the resistant crops intact.While the Environmental Protection Agency has said the herbicides pose no risk to human health, overuse can wreak ecological havoc in areas where natural plant species are not resistant to the chemical compound. Environmental groups have warned that glyphosate can be particularly deadly for pollinators like bees and butterflies.It is illegal to grow genetically modified corn in Mexico, where maize was first domesticated 8,700 years ago and where white corn is a staple crop. Supporters of Mexico’s ban worry that any imports of bioengineered corn would threaten native species, as the varieties can cross-pollinate.The Mexican government in February moved to soften its restrictions, saying it would allow genetically modified corn to be brought into the country for animal feed and industrial use, though not for human consumption. Tom Vilsack, the U.S. agriculture secretary, said he was “disappointed” in the decision.It also remains to be seen whether domestic corn production in Mexico is sufficient to replace imports, the eventual goal of the Mexican government. Last year, farmers in Mexico grew 27.3 million metric tons, about 38 percent below domestic demand. One analysis projected that, should the ban remain in place, corn costs could rise by 20 percent in Mexico and increase rates of food insecurity. More