Diversification, Research Boost Mexican Horticulture: AMHPAC

Q: How does AMHPAC contribute to Mexico’s agriculture exports? 

A: AMHPAC was founded in 2008 and is a relatively young, national organization with around 370 affiliated companies. While its headquarters are in Culiacan, the organization operates in over 24 states, where members grow vegetables in protected agriculture structures. Of these 370 companies, approximately 280 are producers. 

We have been growing at a very rapid pace, with an increase in protected agriculture structures of over 1,500ha annually. This is significant because greenhouses can produce nearly seven times more than open-field farming while improving efficiency. As demand for vegetables in the US market grows, we have seized opportunities and expanded accordingly. Currently, we produce over 2Mt of vegetables on nearly 10,000ha of protected structures, with about 81 to 82% destined for export. Of these, 96% go to the United States and 4% to Canada, making the United States AMHPAC's primary market.

The Western and Bajio regions have experienced the fastest growth in recent years. States such as Jalisco, Queretaro, Michoacan, Guanajuato, and San Luis Potosi have seen remarkable growth rates and have become outstanding vegetable producers.

We aim to rally members to create a united front against threats and strengthen advocacy efforts, while enhancing management capacity, ensuring benefits for all members. Culiacan was selected as AMHPAC's headquarters due to Sinaloa's century-long tradition of producing and exporting tomatoes, Mexico's top export crop in the horticulture sector. The country is also the world's leading tomato exporter.

AMHPAC members produce other crops including bell peppers, cucumbers, and eggplants, which dominate the organization’s production. For years, AMHPAC has worked on strategic objectives, including market diversification in Asia. This has been a consistent goal, and in 2024, AMHPAC continued efforts to diversify markets and crops, as our production is heavily concentrated on tomatoes, which account for 66% of our total output. 

Q: What efforts has AMHPAC implemented to grow in the Asian market? 

A: We began conducting market intelligence a few years ago, mapping out regions like Europe and Asia. Japan stood out as an interesting market, not for its high demand volumes, like those of the United States, but because of its attractive prices. Additionally, Japan offers a strategic gateway into Asia. 

In the past, the Japanese market for Mexican bell peppers was closed due to concerns that the produce was susceptible to the tobacco blue mold. To address this, we collaborated with the Northwest Center for Food and Development Research (CIAD), a prestigious research institution, for three and a half years. The goal was to demonstrate to Japanese authorities that Mexican bell peppers were not at risk. This effort included extensive testing conducted by CIAD, in partnership with CIDH-CAADES, SENASICA, SADER, and the Mexican Embassy in Japan.

By April 2024, Japanese Ministry of Agriculture officials visited Sinaloa for 10 days to verify our findings. They reviewed the research and observed our production systems, yielding positive outcomes. The Ministry is expected to announce its decision in February 2025, and we are optimistic about reopening the Japanese market.

In parallel, we have been addressing logistical challenges. Although Japan traditionally supports air freight for produce, shipping by sea would significantly improve profitability. Advances in logistics technology that extend shelf life have opened the door for this possibility. A group of Mexican producers and Japanese importers is working to refine these solutions.

We also plan to attend Foodex, one of Asia's largest food trade shows to be held in Tokyo in March 2025. This aligns with our broader strategy to establish a presence in Asian markets. While exporting to China is not yet viable due to the lack of phytosanitary protocols, other markets like Japan, Singapore, and South Korea offer promising opportunities. These regions, though smaller in demand compared to the United States, are willing to pay premium prices for high-quality products like Mexican ones.

We are confident in the global quality of Mexican produce. Expanding into Japan and other Asian markets will mark a significant milestone in positioning Mexican horticulture on the world stage.

Q: What is the reason behind the exponential growth in the Western and Bajio regions? 

A: Following the COVID-19 pandemic, there has been a global push for healthier eating, which has benefited agricultural producers. Sinaloa’s growing season is short and intense, running from late October to May. During peak production in February, high output significantly lowers tomato prices in the United States, sometimes leading producers to discard surplus crops. Due to Sinaloa’s extreme summer temperatures, however, which make production harder, some local producers have moved to other states with milder climates to maintain year-round production. This shift has driven the growth of protected horticulture in the Bajio and Western regions, where climate conditions allow continuous cultivation.

Q: How is the association preparing for Donald Trump’s potential trade barriers on Mexican products? 

A: Since 1996, we have been combating the persistent threat of tariffs, primarily driven by tomato producers in Florida and Georgia. These producers have consistently lobbied for tariffs on Mexican tomatoes, which currently stand at nearly 21%. We have managed to prevent this tariff through a document signed with the United States government, known as the Tomato Suspension Agreement. This agreement outlines a series of commitments that Mexican tomato producers must strictly adhere to.

Every five years, we renegotiate the terms to renew the agreement. These negotiations have become increasingly challenging, however. During Donald Trump’s first term as president, the process was particularly difficult. This ongoing threat remains a significant concern, and the situation has become more complicated over time. Adding to this is the looming possibility of a 25% tariff being imposed on all Mexican exports.

Q: How does AMHPAC support its members in addressing water scarcity and reducing water consumption?

A: We are depleting the only planet we have. That is why we focus on Corporate Social Responsibility and sustainability strategies. Compared to open-field agriculture, where water is lost to evaporation and seepage, our controlled systems, especially in hydroponics and greenhouses, are more efficient. However, we still believe there is room for improvement.

In 2024, we initiated a project to measure the water footprint in protected horticulture, collaborating with UNAM and the Netherlands Embassy. The project involves collecting data from 10 companies in Queretaro and Culiacan using different technological methods.

The goal is to assess how much water is being used and identify areas for improvement. Protected horticulture prioritizes efficient water management, with systems in place in greenhouses. This project will provide us with a diagnosis of our water footprint and recommendations for efficient water consumption. Once the project is complete, we will share the findings with our members and offer training to improve water management. 

We expect the project to be completed by August 2025. After that, we will begin measuring the carbon footprint, tracking CO2 emissions and other environmental impacts. Protecting the planet is a moral responsibility, and it also offers practical benefits. Demonstrating progress in sustainability helps us secure better negotiation terms in the market.

Financial institutions now consider sustainability initiatives as part of their lending criteria. Those not addressing these issues may struggle to secure credit, while those making progress could receive more favorable terms, such as lower interest rates and better payment conditions.

Q: What initiatives has AMHPAC implemented to promote the development of added-value products among its members?

A: February is the peak production month in Sinaloa, and the volume of crops often overwhelms the market, leading many producers to throw away their products. However, what they do not realize is that they are throwing away thousands of dollars as tomatoes contain an enzyme called lycopene, which can be used as a colorant, commonly used by Chinese markets, and as a component in the production of dietary supplements. With the growing trend toward healthier eating and increased demand for dietary supplements, lycopene's value is rising.

We have been working to identify major buyers, such as those in the United Kingdom, and establish connections to generate interest in purchasing lycopene. According to CIAD experts, extracting lycopene from tomatoes is a viable process. The raw material is available; now we just need to attract buyers to transform it into a profitable product instead of discarding it. This approach can be applied to many other areas but we need market intelligence, which is lacking across all sectors in Mexico.

Selling this idea is not easy because producers are dealing with everyday challenges. However, we continue to work on it. If complications arise, such as tariffs, we are prepared with alternatives. If not, we can still pursue new business opportunities, thanks to these findings.

Q: What are AMHPAC’s goals for 2025 and what initiatives do you plan to launch this year? 

A: Market diversification, crop diversification, and enhancing commercial and market intelligence to identify value-added opportunities will remain our top priorities. We continue working on sustainability, particularly with water management projects and are now exploring bioeconomy, which aims to optimize resource use, like reusing materials from greenhouse production. For example, the vegetative mass generated in greenhouses can be turned into compost or other products we can sell.

Additionally, we have two major events: our annual congress in August and the Agricultural Social Responsibility Symposium in April in Guadalajara, Jalisco. These events focus on improving social responsibility, enhancing the quality of life for agricultural workers. This issue has two aspects: a moral obligation to help those in need and a business need, as labor in the field is becoming scarce.

In Sinaloa, our member companies provide housing, schools, and clinics for agricultural workers, creating mini-cities. Many children of agricultural workers have started their education thanks to these efforts and even graduated from university. We are working on 15 different social responsibility programs, such as adult literacy, in partnership with the National Institute for Adult Education (INEA). We have agreements with the national food bank, and we are dedicated to improving the business environment and the lives of people in our sector.

The Mexican Association of Protected Horticulture (AMHPAC) focuses on promoting protected horticulture. It represents approximately 300 producer members, managing 9,351ha of protected horticulture across 24 states in Mexico. AMHPAC’s members produce over 1.2Mt of vegetables annually, primarily tomatoes (66%), peppers (18%), and cucumbers (15%), with the remaining 1% consisting of chilies, eggplants, and other crops.