Mexico’s corn imports surge amid production challenges

Fastmarkets sat down with Esteban Jaramillo Reyes, managing director of Mexico’s National Chamber of Industrialized Corn (CANAMI), at the Export Exchange conference in Fort Worth, Texas, last week to discuss current challenges facing corn producers and the new administration’s plans regarding genetically modified corn restrictions and imports.

CANAMI serves as a key consulting body in Mexico City, advising both the public and private sectors; with a membership of 31 partners, CANAMI represents Mexico’s human and industrial corn consumption interests.

“This year is going to be a record in imports,” Jaramillo explained, highlighting Mexico’s reliance on imported corn to meet growing demand.

“In 2013, Mexico’s corn production was 23 million tonnes, and consumption was 30 million, resulting in a self-sufficiency rate of 77%,” Jaramillo said. “Today, in 2024, imports are expected to reach about 23.5 million tonnes, while consumption has grown to 47.5 million tonnes, reducing our self-sufficiency to 50%.”

He attributed this decline to lower production levels coupled with rising consumption, underscoring the need for solutions.

“We need to work together with the government to increase corn production and improve the quality of life of the producer,” Jaramillo said.

Jaramillo projects that Mexico will produce 23 million tonnes of corn this year, amid drought issues.

Production in Sinaloa, a major corn-producing state, has suffered from drought, cutting expected output nearly in half compared with the previous year.

Fastmarkets senior analyst, Anthony Speight, explores critical factors affecting corn supply chain efficiency and market volatility, to answer some of the most pressing questions amongst corn market traders today. Read the report here.

Sinaloa’s corn production could also dip next year

For the upcoming autumn-winter planting cycle, which begins in November and is harvested by July, Sinaloa’s corn production is expected to once again reach only 3.7 million tonnes, down from 6.4 million tonnes the prior year. Jaramillo warned that without an increase in water levels in the dams for the autumn-winter cycle, known as the “irrigation one,” next year’s harvest will likely mirror this year’s reduced yield.

Jaramillo also described two starkly different scenarios within Mexico.

In the central region and northward, corn yields are comparable to the US, averaging 12 tonnes per hectare. But in southern regions yields drop significantly, averaging just 2.15 tonnes per ha, bringing the national average down to 4 tonnes per ha.

In a recent meeting with Mexico’s new administration, Jaramillo discussed government plans to support local producers.

“The issue of financing for the countryside is going to return, and the issue of bringing the producer closer to the buyer is going to return,” he said, pointing to initiatives aimed at boosting Mexico’s marketing efficiency.

Additionally, President Claudia Sheinbaum Pardo’s office will maintain the ban on genetically modified corn for direct human consumption, such as in tortillas and flour.

The cultivation of genetically modified corn in Mexico will also be prohibited, though imports of yellow corn for animal feed, livestock, and industrial purposes will remain unrestricted.

“We need government authorities, the private sector and producers to work together to improve yields and, in turn, enhance the quality of life for producers,” Jaramillo concluded.