KUALA LUMPUR (April 9): Food and beverage manufacturer Able Global Bhd (KL:ABLEGLOB), which has operations in Mexico, is looking to avail of the zero-tariff perk accorded under the United States-Mexico-Canada Agreement (USMCA) to mitigate rising trade barriers on exports to the United States.

Able Group’s operations in Mexico are housed under Able Dairies Mexico SAPI de CV, a joint venture in which Able Dairies Sdn Bhd, a wholly-owned subsidiary of the company, holds a 43.13% stake, alongside three Mexican shareholders. The facility began exporting to the US in early 2024.

While spared from US president Donald Trump’s sweeping reciprocal tariffs, Mexico is subject to Trump's previously imposed tariffs of 25% on steel, aluminum and automobiles, as well as on goods that do not comply with the regional USMCA trade pact.

Under the USMCA trade pact, qualifying goods that meet rules of origin and other criteria can enjoy zero tariff within North America.

“Our current sales from Mexico to the US represent about 10–15% of our exports [from the Mexico facility]. That would be the immediate extent of exposure," group chief executive officer Edward Goh Swee Wang told The Edge.

"We are exploring the United States-Mexico-Canada Agreement (USMCA) agreement which may allow agriculture products trade without tariff," Goh said.

The USMCA, which came into force in July 2020, is a trilateral trade agreement that replaced the North American Free Trade Agreement (Nafta).

It streamlines trade among the US, Mexico and Canada by eliminating tariffs on most goods — provided those goods meet strict content and labour standards, including sourcing thresholds and wage criteria for manufacturing sectors.

Goh said the group is currently reviewing whether its dairy exports — processed and packaged in Mexico, including sweetened condensed milk and milk powder — are eligible for preferential treatment under the USMCA.

“It is still early days. We [expect better clarity] in a few days. It's not 100% clear [yet] what the [compliance] requirement of USMCA [will entail], but we’re seeking clarity [with partners and authorities in Mexico],” he said.

According to Invest Penang, the state’s agency for investment promotion, the USMCA positions Mexico as a key beneficiary in the current trade landscape.

Goods that comply with USMCA rules face 0% tariff, while non-compliant goods may be subject to 25% tariffs under the International Emergency Economic Powers Act (IEEPA). If emergency orders related to fentanyl control and border enforcement are lifted, the tariff could fall to 12%.

Able Dairies Mexico’s financial contribution to the group is minimal for now, according to the company’s 2023 annual report. Revenue from Mexico was RM6.09 million, making up 0.94% of the group's total revenue of RM648.09 million last year.

The company exports extensively to Africa, Asia and Central America, with the bulk coming from its food and beverage division, which contributed RM530.91 million or 82% of group revenue in 2023.

Back home, Able Global's share price has fallen more than 33% year-to-date, dragged down by a corruption probe involving its top leadership.

In February 2025, both Swee Wang and executive chairman Ng Keng Hoe were remanded by the Malaysian Anti-Corruption Commission (MACC). The group later clarified that the investigation was related to Ng’s private business dealings and not linked to Able Global. Nonetheless, Ng was formally charged on March 28 for abetment of dishonest misappropriation.

Both Ng and Swee Wang are major shareholders of Able Global. As per the latest filings, Swee Wang and his father, Goh Mia Kwong, collectively own a 19.39% stake, while Ng holds 12.46%.

At market close on Wednesday, Able Global’s share price closed four sen or 2.94% lower at RM1.32, valuing the company at RM394.30 million.