Brazil is the world’s largest beef exporter, with China as its main trading partner. In August, Mexico overtook the U.S. to become its second-largest export destination for the commodity.

“It is very likely that countries that can triangulate Brazilian beef will increase their purchases following Mexico’s example,” Mauricio Nogueira, director of livestock consultancy Athenagro, said in an interview. “If Mexico starts sending beef to the U.S., it will have to buy from someone, it will have to buy from here.”

Argentina would be another candidate to import and eventually re-export Brazil’s beef to the U.S., he added.

Nogueira’s Athenagro did not change its year-end projection for Brazil’s beef exports after Trump’s 50 per cent tariffs on the country’s products took effect on August 6. His consultancy is projecting a 7.5 per cent increase this year in Brazilian beef exports, to 3.08 million metric tons. Through July, such exports rose more than 13 per cent.

Luis Rua, secretary of trade at Brazil’s agriculture ministry, said Brazilian beef helps keep Mexican inflation in check. Whether Mexico will re-export supplies from Brazil is unclear.

“We send it to Mexico, but we don’t know exactly what Mexico will do with the meat,” he told Reuters.

Economist Thiago de Carvalho confirmed expectations of a shift in global beef flows, with Brazil potentially selling to markets previously served by Australian exporters, for example.

Factors such as tight global beef supplies, which the U.S. is facing after its cattle herd hit historical lows, may also direct demand to Brazil, Carvalho added.

Japan, which traditionally buys meat from the U.S., may soon open up for Brazilian products, he said.

— Reporting by Roberto Samora in São Paulo and Kylie Madry in Mexico City.

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Mexico, which ships nearly 80 per cent of its exports to the United States, was not included on Trump’s list of global, across-the-board tariffs announced on nations last week, which Sheinbaum hailed as a major success.

Still, Mexico is subject to Trump’s previously imposed tariffs of 25 per cent on steel, aluminum and automobiles, as well as on goods that do not comply with the CUSMA trade pact.

“As much as possible, we would like to avoid imposing reciprocal tariffs,” Sheinbaum said in a morning press conference.

She added that Economy Minister Marcelo Ebrard would travel to Washington to meet with U.S. officials, as he has done in recent weeks.

Sheinbaum said slapping a retaliatory tariff of 25 per cent on U.S. steel and aluminum shipments “would represent price increases in Mexico.”

“We aren’t ruling it out, but we prefer to continue with dialogue,” she added.

Mexican officials have said U.S. steel and aluminum tariffs are unjustified as Mexico imports more in the sector from the U.S. than it exports to the U.S.

The nation’s peso and main stock index weakened more than one per cent by mid-morning on Monday, part of a market plunge worldwide as Trump threatened to further increase tariffs on China.

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The three neighboring nations, and major partners in commerce, have entered a trade tussle after U.S. President-elect Donald Trump threatened to slap tariffs on the countries to the north and the south if they did not clamp down on drugs and migrants coming into the U.S.

Mexico is working on both issues in order to “come to the table” to negotiate without obstacles, Luis Rosendo Gutierrez told outlet Inside U.S. Trade.

Since Trump’s tariff threat, Mexico has launched an offense on contraband goods from Asia coming into the country, and officials seized a record amount of fentanyl. They have also detained thousands of migrants, vowing to prevent them from making it north.

Mexican officials have been in touch with Trump allies, Gutierrez added, though they have not met with incoming administration officials. The exception is Jamieson Greer, Trump’s tapped trade representative, with whom Gutierrez met before his nomination.

Trump, as well as some U.S. industry leaders, have accused Mexico of being a “backdoor” to Chinese goods and investment, which Mexico has denied.

Screening investments

Mexico is looking to take a cue from the U.S., however, in screening investments coming into the country, Gutierrez said. Mexico is looking to develop a process similar to the U.S.’ Committee on Foreign Investment, he explained.

When asked if that would affect Chinese automaker BYD’s plans to build a factory in the Latin American country, Gutierrez responded that Mexico wants “to play with the same rules” as its trade allies.

Trump had threatened to put a 100 per cent tariff “on every single car coming across the Mexican border” in response to BYD’s plans, though the carmaker has repeatedly said its plant would serve the local market and not the United States.

Mexico is considering doling out incentives to draw manufacturing investments, Gutierrez said, suggesting Mexico could produce batteries that the U.S. wants to be made regionally.

Corn complications

Mexico is also awaiting the result of a dispute panel under the USMCA trade deal regarding Mexico’s restrictions on imports of genetically-modified corn.

Mexico will comply with the panel’s ruling even if unfavorable toward the nation, Gutierrez said. And depending on the outcome, Mexico will weigh whether it must make changes to a proposed constitutional reform that would bar the use of GM corn for human consumption, the official added.

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The company told Reuters late on Thursday the number of employees impacted by the move from the Iowa plant would depend on several factors, but that around 80 worked on the mower-conditioner production line with support from 10 salaried employees.

The plant in the northern Mexican city of Monterrey already makes “hay and forage” attachments, according to a John Deere spokesman, and the move was motivated by the desire to make all of the equipment in that category in the same place.

Deere & Co is also “forming a team to develop and propose plans to revitalize the Ottumwa Works operations for the future,” spokesman Dan Bernick said in a statement.

In June, the agriculture equipment maker said it would move cab production from Waterloo, Iowa, to another Mexican plant.

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