U.S. Grain Exports to Mexico Rise in Value to $7.3 Billion

U.S. exports of grain, oilseed and related products to Mexico averaged 22.2 million metric tons per year from 2008-2012 with an average annual value of $7.3 billion, according to a report by the Center for North American Studies at Texas A&M University.

The result is a 22 percent volume increase over the average of the early 2000s and two and a half times the value, according to the research findings.

“Higher grain and oilseed prices on the world market were certainly one major factor,” said Dr. Parr Rosson, professor and head of the department of agricultural economics, Texas A&M University. “The other factor was increased demand in Mexico for grain-fed beef, which has risen, especially in major cities across that country. Increased number of cattle in feedlots resulted in not only more tonnage being fed, but higher prices as well. The third factor was a lower valued U.S. dollar during much of this time period, especially compared to historically high values over the past 20 years.”

Other economists on the study team included Flynn Adcock, international program coordinator with the Center for North American Studies, College Station; Dr. Mark Welch, AgriLife Extension grains marketing economist, College Station; and Juan Villa and Joe Antonio Perez-Vidales, researchers with the Texas A&M Transportation Institute, College Station.

Yellow corn,most commonly used for animal feed and corn starch, was found to be the largest volume export of the product categories, accounting for 35 percent in 2011. Soybeans, crushed for meal and oil, accounted for 13 percent, while hard wheat used for human consumption and grain sorghum used for animal feeding accounted for 10 percent.

U.S. exports of grain, oilseed and related products to Mexico averaged 22.2 million metric tons per year from 2008-2012 with an average annual value of $7.3 billion

“Together, these top four products accounted for 68 percent of the volume of U.S. grain and oilseeds exports to Mexico,” Rosson said. “Yellow corn also dominated export values to Mexico with 29 percent during 2011, followed by soybeans at 20 percent, hard wheat at 10 percent and sorghum at 8 percent.“

Dried distillers grains, high fructose corn syrup and soybean meal were all relatively recent introductions to the Mexico market, according to the report.

“Exports of these products, which include soft wheat and rice, grew more than 500 percent since 2000. In total, 14 product categories are covered in this report in various degrees of detail based upon the availability of data,” Rosson said.

The report stated rail was the main mode of transport for U.S. grains, oilseeds and products entering Mexico, accounting for 14.8 metric tons. The border town of Nuevo Progresoin Tamaulipas was noted as the only major port of entry without rail access.

Seaports are the second most dominant mode of entry for U.S. agricultural exports to Mexico and account for 8.11 million metric tons, according to the report. Approximately 42 percent of these imports leave the seaport area via rail, while at least 17 percent leave via truck.

Source:agrilife.org