Trade talks in the sugar industry have taken divergent turns in recent days. Mexico and the U.S. have reached a detente in their putative sugar wars. The U.S. Commerce Secretary Wilbur Ross allowed a 24 hour extension of talks to complete technical issues. An imposition of tariffs had been a potential consequence if an agreement on quotas couldn’t be reached. That in turn may have led to Mexico restricting U.S. high fructose corn syrup imports. The move is also an encouraging sign that practicalities rather than dogma may be a driver of U.S.-Mexico trade talks.

Mexican sugar exports jumped 57.7% on a year earlier in April, reflecting a 48.3% jump in shipments to the U.S. as well larger increases elsewhere. That followed shipments to the U.S. falling close to zero in March. Exporters including San Cristobal and Santa Rosalia clearly anticipated the position solution of talks.

Chart compares year-over-year move in Mexican sugar exports against U.S. share of the total on a trailing 12 months (solid line) and monthly (dotted) basis. Source: Panjiva

On the other side of the Pacific, discussions between China and Brazil to ensure the latter’s continued access to the market have broken down, Bloomberg (paywall) reports. That may lead Brazil to take the case to the WTO. China had restricted Brazilian access with higher tariffs on out-of-quota volumes as outlined in Panjiva research of May 25. Panjiva data shows that China has had no problems replacing Brazilian production, with sugar imports rising 22.0% on a year earlier in April as the result of a 168% increase in shipments from Cuba.

Chart segments Chinese imports of sugar (HS 1701) by country of origin Source: Panjiva