Mexico backs Canada in WTO complaint on U.S. corn

MEXICO CITY (Reuters) - Mexico said on Tuesday it would likely join Canada in a complaint to the World Trade Organization about U.S. corn subsidies.

More than half a dozen countries have come out to back Canada, which is expected to launch a formal WTO challenge to U.S. corn subsidies on the grounds they violate world trade rules.

"If a panel is convened, Mexico will join as an interested third party," Eduardo Sojo, Mexico's economy minister, told reporters in a news conference.

Sojo spoke after talks in Mexico City with U.S. Agriculture Secretary Mike Johanns, who is trying to revise the way the United States pays out farm subsidies to ensure they are in line with WTO rules and avoid legal battles.

U.S. farm support has become a crucible in the Doha round of world trade talks, which broke down in July in an impasse over agriculture. Critics say the subsidies drive down prices and lock out poor farmers in developing countries.

Canada in January requested formal talks over what it sees as trade-distorting support to U.S. corn farmers and is expected to go ahead with a formal filing on the case.

Following a 2005 complaint by Canadian corn producers, Canada's own International Trade Tribunal ruled last May that U.S. corn imports did not hurt the domestic industry, but farmers have appealed the decision.

One study concluded that U.S. corn subsidies depress the price of corn in Canada by about 14 percent.