The United States has escalated its objections to Mexico’s curbs on genetically modified corn imports, requesting a dispute settlement panel under the North American trade pact.

The request to send the dispute to arbitrators was announced after formal consultations failed to resolve deep divisions between the two close trading partners over use of genetically modified corn, widely produced by U.S. farmers.

Mexico’s economy ministry said it would defend its GM corn policies before the dispute panel, saying on the social media platform X that they “are consistent with trade obligations.”

Washington alleges that Mexico’s decree banning imports of GM corn used in dough and tortillas for human consumption is not based on science and violates its commitments under the Canada-U.S.-Mexico Agreement on trade launched in 2020.

If the panel rules in favour of the U.S. and Mexico fails to comply with its directives, the US could ultimately win the right to impose punitive tariffs on Mexican goods, which could spark a rare North American trade war.