Investment, Inflation and Supply Chain Transformation

The Coca-Cola Company announced a US$6 billion investment in Mexico as the country implements higher excise taxes on sweetened beverages. Meanwhile, FAO reported that hunger in Latin America fell for the fourth consecutive year. 

This is the Week in Agribusiness and Food!

Coca-Cola to Invest US$6 Billion in Mexico Amid IEPS Hike

Mexico secured a US$6 billion investment commitment from The Coca-Cola Company, announced by President Claudia Sheinbaum after a meeting with COO Henrique Braun, marking one of the largest beverage-sector pledges under the current administration. The announcement comes as Mexico raises excise taxes on sweetened beverages, doubling the IEPS quota to MX$3.08 per liter and introducing a new tax on noncaloric sweeteners, prompting Coca-Cola and FEMSA to deploy pricing, packaging and affordability strategies to offset the impact. Executives also pointed to the 2026 FIFA World Cup in Mexico as a key consumption catalyst, alongside product reformulations aimed at reducing calorie content by 30% across formats.

Hunger Declines, Food Costs and Malnutrition Persist

Undernourishment in Latin America and the Caribbean fell to 5.1% in 2024 from 6.1% in 2020, lifting 6.2 million people out of hunger, according to a joint FAO-led report, with Mexico’s prevalence estimated at 2.7%. However, 25.2% of the region still faces moderate or severe food insecurity, 181.9 million people cannot afford a healthy diet and obesity affects 141 million adults, as the region remains the most expensive globally for healthy eating at US$5.1/d per person. In Mexico, where a balanced weekly diet can cost MX$1,000 to MX$1,300 per person, high food costs are shaping consumer behavior, public health outcomes and agribusiness competitiveness, even as an IICA-IMF study finds hunger could be eradicated at a fiscal cost below 0.25% of GDP for most countries.

Mexico’s Craft Beer Industry Gears Up for World Cup Surge

Mexico’s craft beer industry expects production to grow 12% annually ahead of the FIFA World Cup 2026, with sales projected to spike by up to 300% in host cities such as Mexico City and Guadalajara, offering a short-term boost to a segment that currently represents less than 1% of the national beer market. Industry leaders warn that structural constraints, including IEPS taxation, aluminum tariffs, bottling capacity risks and more than 90% dependence on imported hops, continue to limit competitiveness for small and medium-sized brewers. Despite these challenges and higher price points compared to industrial beer, the sector sees the tournament as a strategic opportunity to expand market share, professionalize operations and strengthen craft beer culture, leveraging idle installed capacity to meet anticipated demand surges.

Restaurants Hit by Violence Foresee Recovery Ahead

Widespread violence across the country forced mass restaurant closures and operational suspensions, with National Chamber of the Restaurant and Seasoned Food Industry (CANIRAC) reporting that up to 95% of establishments shut down in some areas, disrupting supply chains, employment and revenue amid ongoing food inflation. Industry leaders cited logistics breakdowns, suspended delivery platforms and reduced foot traffic of up to 60%, underscoring how security risks have become a structural vulnerability for Mexico’s restaurant and hospitality sector. While Lent, Easter and the FIFA World Cup 2026 are expected to drive short-term and structural recovery, with projected sales growth of up to 15% on match days and near 5% sector expansion in 2026, persistent insecurity continues to threaten stability and investor confidence.

Seasonality Is Dead: The Rise of On-Demand Global Food Trade 

Global food trade is shifting from a season-driven model to an on-demand, digitally enabled ecosystem powered by platformization, real-time analytics, agile logistics and embedded finance. Digital marketplaces now allow buyers to source perishable goods instantly across borders, while advances in cold chain infrastructure, route optimization and integrated financing tools reduce risk, unlock working capital and weaken the traditional constraints of harvest cycles. As procurement becomes demand-led rather than calendar-based, the industry is evolving into a more resilient, flexible and opportunity-driven marketplace capable of responding dynamically to price signals, climate disruptions and shifting consumer demand.