16. Monopolisation of the Food Market in Mexico: The Case of Potatoes

This study was sponsored by the Centre for Advanced Research at the National Institute of Anthropology and History (CISINAH, now CIESAS) in Mexico and was first published as ‘La monopolización del Mercado interno en México. El caso de la papa’ in Comercio Exterior [Foreign Trade], vol. 28, no. 11, November 1978, pp. 1349–1358.

The study on the potato crop was conducted in eight months of fieldwork in the southern state of Mexico and was supplemented by another six months of field research in the central market La Merced and in the most important areas of production of potatoes in Mexico. The fieldwork was undertaken with the support of Juan Carlos Álvarez, Cristina Domenech, Laurentino Luna and Enriqueta Silva, and was coordinated by the author. I thank them all for their cooperation and personal involvement in the project.

Merchants buying and selling potatoes are located in La Merced. They are not a homogeneous group. On the contrary, among them exists a clear geographic division, in turn, also a social stratification. In the warehouse of La Merced operate small merchants who sell potatoes for retail. On one side of this building, on the platform, there are several stores (from 9 m² to 14 m²), which are leased by the Government to merchants who buy and sell wholesale. Families are prohibited from having more than one store. Both this and the restricted space considerably limit the handling of commodities and therefore constrict the ability of such merchants to accumulate capital. There is a third group, the potato wholesalers located in the streets of Misioneros, passage Cruz Blanca, square Juan Bas, passage Saint Vincent and Ramon Corona. They belong to the Old Merced. They have no limits of space or number of stores and therefore are economically a powerful group. Their income comes not only from the trade process but also from the production cycle and the credit system. They harvest potatoes during the rainy season and sell these potatoes as seeds to the farmer in their native states (Puebla, Tlaxcala and Veracruz). They also work “by half” with potato farmers in other states during the dry season. Since they cannot attend the business in La Merced and simultaneously produce, they have relatives who grow potatoes and employ salaried workers. The latter, already specialised in potato cultivation, support crops in states where these merchants operate “by half”. The merchant of the Old Merced is not only a trader, but also a producer of seed potato, of potatoes and a sharecropper (on half). The same is true, albeit to a lesser extent, for merchants of the Platform, who are limited in their additional business due to lack of available capital.

Not only are they not paid but, in reality, the farmer must deduct from his liquidation the amortisation of farming implements and the payment of his own workforce and that of his family, who participated in the production process, not to mention the income from the rent of the land.

This means an unjust and wrong distribution of profits, regardless if the participation of the peasant is personal, since it represents the only source of income. The trader, meanwhile, limits himself to investing capital in very safe conditions and gets much higher interest than from his own activity in trade.

The Regional strongly attacks the Cooperative. The Cooperative was partially supported by the federal government, as this authority opposed the total monopolisation of perishable goods in La Merced. The Regional becomes stronger during the months of January to July, when crops are harvested in the states that are directly controlled by them.

The presidents of both unions were brothers and one had to leave the presidency due to ‘overwork’ (pressure from the authorities of Mexico City, which apparently cannot accept brothers in opposition positions). Nevertheless, the agreement remained in force.

To get minimal salary and cover its essential expenses, a merchant must sell every day 100 kg of potatoes from quality 7th, the lowest quality.

Letter from the 26 April 1977, number 032. – exp. 1. 2/977 – to the Ministry of Agriculture and Hydraulic Resources (Secretaría de Agricultura y Recursos Hidráulicos: SARH).

But this was not the only foreign intervention. Earlier, a group of Chinese had experienced new imported seeds and acclimatised them in Saltillo and Chihuahua. For twenty years they supplied the market until the seeds were sponsored by the Rockefeller Foundation. They replaced first the ones in the Bajío (central part of the country) and later the ones in the State of Mexico.