Friday, March 7, 2008

"Sour times for sugar sector"

(Published March 8, 2008 in The Guadalajara Reporter)

January 1, 2008 was a distempering milestone for the Mexican sugar industry. After years of restricted trade between the U.S. and Mexico per NAFTA laws negotiated 14 years ago, tariffs and other regulations were finally phased out and the sugar market, as well as other agricultural sectors, was left open to the caprice of the global market.

The bouleversement in the agricultural markets has not sat well with groups on many ends of the business spectrum; Mexican farmers spent the end of January marching the same trajectory Pancho Villa took during his 1914 march into Mexico City, ending in the Zocalo of Mexico City where they burned tractors in protest.

The farmers insisted they would not be able to compete with highly subsidized U.S. growers and that th
e Mexican government has not done enough to protect them. Despite efforts on both sides of the border to maintain the previous restrictions, a bid to renegotiate trade laws was dropped in early February.

The tariff eliminations catch sugar producers between a rock and hard place. Take the case
of Grupo Azucarero Mexico (GAM). Located here in Jalisco, it’s the second largest sugar producer in the country, turning out eight percent of the nation’s sugar from their four mills, but fast losing ground to international sugar producers.

Hilda Alvarez, a head accountant working in GAM’s administrative offices in Zapopan, explained that NAFTA’s recent opening of agricultural trade is one impetus edging GAM downward; Mexican sugar simply can’t compete with cheap U.S. imports. In fact, Mexico will boast a 500,000-ton surplus this year and produces more than enough to cover domestic demand, but still imports cheaper sugar so as not to sell below production costs.

But GAM knew long ago tha
t NAFTA would have a deep effect, said Alvarez, and planned ahead for this day. “To prepare us, our CEO made trade with sugar companies in Brazil in order to share information about costs of production.”

It is not NAFTA that is most affecting GAM’s production costs, Alvarez believes, but the unions that represent sugar mill workers.
Alvarez said the sugar unions’ power and demands have become too strong. Because the growing and production period divide the year in half, a union’s refusal to work during the essential processing time will cost the company a great deal of time and energy.

In November 2006, union workers at Jalisco’s largest mill in Tala went on strike: over 1,000 union members in the milltown and thousands more nationwide petitioned for the consistent payment of their workers’ pension plans after retirement. The group demanded 3,000 retired workers be caught up for stopped payments as far back as 1998. They claimed industrialists were ignoring agreements that provide for fair pay.

The strike ended within a week, but another threatened in January of 2007 when the union claimed the issues unresolved. The strikes put 1,500 tons of sugar produced per day at risk. To an estimated 2.5 million people employed in the sugar industry, guarantee of payment has become increasingly important in the weakening market.

Sugarcane farmers also stopped deliveries to mills last December to protest their falling payment, which is based on the 50-kilo load’s selling price in the Mexico City market. Alvarez said that last year in January and February, a 50-kilo load of sugarcane, the raw product the company buys to process, cost 350 pesos. Today it costs around 270 pesos and the price is dropping.

The government created a plan last year to bolster sugarcane prices to maintain fair wages for farmers. But the plan came into effect at the beginning of this year, the same time as trade restrictions were lifted by NAFTA.

Consequently, the dawning of 2008 was a double blow for GAM. The price for raw materials suddenly rose at the same time they were forced to sell at lower prices to compete with international markets.

The only players that appear to benefit from the sugar market’s surplus are industrial consumers, soft drink or baked goods companies who can buy the sugar at its domestic crisis price or buy on the international market, often from Brazil, a country that faces little union pressure and whose climate is conducive to a longer, more productive growing period than Mexico.

“Those companies can buy sugar at lower prices than before, but the consumer doesn’t know,” Alvarez said. “The last consumer has not noticed any changes in the price of products they buy, although the sugar has lower prices than ever.”

Presented with a multilateral industrial nightmare, GAM is working to recover its losses.
“We’re looking for opportunities to lower costs. One option is in energy,” said Alvarez. The mills are able to generate ethanol from reprocessed bagazo, the leftover chaff from sugarcane; producers are currently investigating the costs.

Alvarez does not project company layoffs, at least for the time being, and said it would most likely affect the administrative area of the company, not production workers.
It is not clear if the sugar market will in fact fall into the chaos many analysts have projected this year, but Alvarez expressed fear that it would continue along its descending path if not more strictly regulated.

“The government needs to do something,” she said. “If prices keep getting lower, no one will be able to support this.”

Sunday, March 2, 2008

"Dogging the developers: neighborhood group presses on"

(Published March 1, 2008 in The Guadalajara Reporter)

In the center of the Zapopan’s Colonia Jardines del Sol, not far from several elementary schools and across from rows of multi-car houses on modern, palm-shaded Wisteria Lanes, is the site of the old Motorola plant and the current epicenter of a legal and environmental nightmare.

The SSC Inmobilaria group plans to build La Ciudadela, a commercial center with five luxury apartment towers, on the former factory site. The mega-project would boost the population density of the neighborhood by 20 percent. Jardines del Sol's neighborhood association, headed by German-born musician Ludger Kellner, is vehemently opposed to the project and is fighting tooth and nail to put a stop to the construction.

The battle has been going on for some time; The Guadalajara Reporter covered the story last August when Kellner’s legal status in Mexico was threatened by an anonymous complaint to the regional Immigration office, believed to be filed by someone whose interests were aligned with La Ciudadela project.

“That was scary for other foreigners who could see that even if you are legally living in the country, some financial or political interests might try to harm you with the pretense that you’re doing something illegal,” Kellner commented in a recent interview.

The complaint didn’t prosper and Kellner has continued his battle with SSC. According to Kellner, the current owners of the landsite are guilty of serious environmental violations, punishable by jail time. In a press conference last week, Kellner and other neighborhood advocates renewed their promise to prove the owners are constructing on contaminated land.

For a time, legal procedures ruled in favor of Jardines del Sol’s residents. In November of last year, Zapopan’s municipal government resolved an initial complaint the neighborhood association had filed in May; on November 23, 2007, the Ayuntamiento de Zapopan shut down the building site pending environmental evaluation.

The neighborhood’s own survey of the site’s surrounding area showed nearby residents suffered from a ten percent higher propensity of symptoms associated with industrial toxins, such as respiratory and nervous system damage.

Subsequently, the building company lost every appeal through to the Mexican Supreme Court. SSC Inmobilaria had nowhere else to go, and the site stayed closed until January 25, 2008.

On that date something happened that Kellner calls “outside any legal process.” By an inexplicable retro-appeal to the Jalisco state courts, the building company was granted legal permission to continue construction by a state magistrate.

“The legal course is the other way around,” Kellner said. “You first of all complain to the lowest jurisdiction, and then you end up in federal court, and if you lose there you have nowhere else to go. But they went exactly in reverse.

“They have continued from the 28th of January, and of course they’re going as fast as they can now because they feel we might stop them again – and we are going to stop them again.”

On February 21, in a rare public response to the neighborhood association’s accusations, the landowners said they complied with the law and found the ground within safe limits of pollutants.

Manuel de Asis Orta, vice president of SSC Inmobilaria, said that their tests found thallium (a bioaccumable heavy metal) in amounts permissible under Mexican law and that it “is false that contaminating materials exist.”

Responded Kellner: “The fact is that the authorities are not asking them to do what the law requires ... Their analysis was done in a completely incorrect way because by that time they had already taken out tons and tons of earth and thrown it into other places. That was polluted earth. They were polluting the whole city.”

Furthermore, explained Kellner, the Federal Prosecutor for Environmental Protection (Profepa) reported that samples were extracted from a depth of about one meter, while the law requires samples to be taken at zero to five centimeters as heavy metals are found on the ground’s surface.

“They took the samples at the wrong depth, and even so, they found thallium,” said Kellner. “Thallium is a very toxic heavy metal, it’s soluble in water, and even in the air; it gets though your skin and into your body, and it’s not eliminated by anything. It’s what they call a silent death.”

Since Motorola vacated the site in 1999 after a 31-year residency, the land has changed hands a number of times. When the Universidad del Valle de Mexico bought the land in 2003, they required that the previous owner, Alejandro Sanchez Garza, have the land surveyed for pollutants. The study found the land to be contaminated, the results of which were included in every subsequent deed.

“Nobody who was involved in this deal here is able to say he didn’t know about this document, because it’s cited in the deed in which the lot was sold to the German bank as a fiduciary,” Kellner said. “The funny part about this is that the two partners who have the option to purchase the land say that they never knew about this document.”

There is more that does not add up: the federal government does not have a single paper filed by Motorola or ON Semiconductors (a subsidiary of the Texas Pacific Group, which bought up the semi-conductor division of Motorola worldwide) registering their industrial waste – how much, what type, if transported by government authorized hazmat freight companies – for all activity during the 1980s and 90s. Toxic waste registration is obligatory under federal law.

Recently the Jardines del Sol neighborhood association went to federal criminal courts to file a complaint requesting the builders be held responsible for their crimes. They are also at the point of petitioning federal courts once again that the construction be stopped.

SSC Inmobilaria insists that La Ciudadela will benefit the community. They announced they will donate 1,200 square meters of land so the Federal Electricity Commission can build a substation that could provide 1,200 area homes with energy.

Kellner will continue to combat the project. “We know that this is a lengthy process that might take several years, because you cannot remedy a polluted site within weeks.”

Not included in the Reporter's edition but worth mentioning:

Kellner noted that two water bottling plants, Bonafont and Arco Iris, are not far from the contaminated landsite, as well as the Sabritas factory.

“The government favors investment. Investment goes first, because it generates employment, it generates prosperity. But this is not prosperity if you have people die on account of investment.” - Ludger Kellner

"Gabacha reporter grills Orange County's most informed Mexican"

(Published March 1, 2008 in The Guadalajara Reporter)

Gustavo Arellano isn’t just Mexican, he is “The Mexican” – the voice of the United States’ newest and largest minority who answers every question gabachos and latinos have “wanted to know about Mexicans but [were] too pendejo to ask.” Arellano smashes stereotypes one at a time in his nationally syndicated OC Weekly column called “Ask a Mexican,” and released a book last May by the same name. A Spanish version of the book will soon be released in Mexico.

Last week
The Guadalajara Reporter’s MEREDITH VETO spoke to Arellano via telephone from his Orange County, California office.

MV: The questions you receive are strongly worded, often with racist undertones. You obviously take this in stride. But do you ever get discouraged by this gabacho mentality?

GA: Oh, no, I love the racist questions. They’re the best ones. I get all kinds of different questions, not just racist white people who write in to me, but from Mexicans who are racist against whites or blacks or other Mexicans. I get questions from Mexicans in Mexico wanting to know about some aspect of Mexican history or culture. No matter how much I write the column, no matter how much I try to debunk stereotypes, racism’s going to exist. So the best thing I can do is tackle it and ridicule it.

MV: I understand you received a Masters degree from UCLA in Latin American studies. How much does your historical foundation come into play when you answer questions? What is your research process like?

GA: My college education was great for a number of reasons but really the main reason was that it taught me how to do research, get a lot of information and then boil it down to the particulars you need. For instance if there’s a question about etymology, I’m going to consult etymological dictionaries, I’m going to talk to language professors, I’m going to consult history books. If somebody has a stupid question like “Why do Mexicans sell oranges on the side of freeways?” that’s not going to take a lot of research. That’s just going to be a joke off the top of my head. [The answer: “What do you want them to sell, Steinway pianos?”]

MV: You are also, and firstly, a food critic for the OC Weekly. You write a column called “This hole-in-the-wall life.” I liked what you said a few weeks ago about small Mexican restaurants in the United States, when browsing a menu: “Figure out which Spanish words have yet to become part of the Southern Californian Spanish. Order them – none will disappoint.” Would that sum up your attitude as a food critic? Is that what you look for in a good hole-in-the-wall restaurant?

GA: I used to do higher-end restaurants, but they never particularly interested me because I don’t want to spend 100 dollars on a good meal when I could have a better meal for about three bucks. When it comes to Mexican restaurants, I try to review restaurants that will feature food from a particular region nobody has ever really had. For instance, here in Orange County there are a lot of people from Jalisco. What’s a great meal from Guadalajara? Tortas ahogadas. Growing up, I never had a torta ahogada until I went to a taco truck and said, what is this? So to me, it’s foreign food as well. More importantly though, it’s great food. By doing restaurant reviews like that I’m also able to talk about the phenomenon of migration to the U.S.

MV: Would you mind answering a few of my own gabacha inquires?
GA: Sure, yeah.

MV: First, when I came to Mexico as a study abroad student, my program advisor warned female students that Mexican men are far more likely to cheat on their partners than American men. I believe she even had numbers to back it up. Does that have any truth, or was she just trying to protect us?

GA: Protect you from what? Oh please. Number one, if we’re going to play the stats game, the most comprehensive study of male cheating patterns was done by the University of Chicago, they interviewed God knows how many people, and they came to the conclusion that the fidelity stats for latinos and whites weren’t really that far apart to say this is endemic in the culture. Cheaters are cheaters all across the world. Your teacher absorbed all these stereotypes of the Latin lover, the unfaithful man, those stereotypes. I’m Mexican and I haven’t cheated on anyone in my life.

MV: Here’s another: Clowns are everywhere in Mexico. They perform on the streets, they’re featured on television and in advertisements. It strikes me as odd only because Americans tend to be fairly hostile towards clowns, even fearful of them. Any explanation?

GA: [Laughs] You know it’s funny, that’s true. I laugh because I agree with you. I personally don’t care much for clowns, but what I mean is that they neither draw fear nor happiness from me. I never understood why a lot of white people are mortified by clowns. You know, what do clowns supposedly represent? Gaiety, happiness, hilarity. Who wouldn’t want that in their lives? If Mexicans are hanging out with clowns, that just means they like happiness more than other people. They like fun stuff. Especially with the television shows, there’s a lot of goofiness, it’s really outlandish. Kind of like the Japanese. We like our humor to be as outlandish as possible.

MV: If Americans could stand to learn one thing from their Mexican neighbors, what would that be?

GA: What Americans could learn from Mexicans is that we’re not trying to take over the U.S. Up here, I think that’s always lurking in the minds of white Americans. Oh my God, these Mexicans are moving into our neighborhood, they’re trying to take over our culture, they’re trying to impregnate our women ... Aaaah! No, they’re not. It’s so nationalistic, it’s so assuming that every action [Mexicans] take against them has to be because they’re Americans. Just so you know, we don’t want to take over the United States.

Curious about Mexican culture? Write to with your own inquiries.