Policy Reforms and Mexican Agriculture: Views from the Yaqui Valley

The overall effects of policy reforms enacted during the 1990s in Mexico on financial and economic profitability of Yaqui Valley agriculture are assessed in this study, which describes the reforms,examines how exogenous shocks affected the reform process,and documents how rural people and institutions adjusted to the changed circumstances. Virtually all of the reforms affected Yaqui Valley farmers because of the commercial character of their agriculture (relatively large, irrigated wheat farms), their close proximity to the US,and the new "openness" of Mexico's economy. By almost any standard,the reforms were both wide-ranging and successful, at least as measured in efficiency terms, yet the Yaqui Valley's rural communities face significant challenges at the start of the 21st century. The ejido communities have lost cohesiveness and even larger-scale farmers in the private sector face serious income problems. More generally, farmers have yet to find profitable new production systems, including the associated marketing institutions, which are consistent with greater reliance on world agricultural prices and diminished dependence on explicit and implicit subsidies from the government.