Mexico Moves to Support Sugarcane Producers

The Ministry of Agriculture and Rural Development (SADER) will begin the process of integrating sugarcane producers into Well-Being programs. The move comes after a year of heightened tensions driven by low-priced sugar imports, which industry leaders say have displaced domestic sugar, and strained producer incomes.

These actions are part of the sugarcane sector modernization strategy outlined in Plan México, which focuses on increased mechanization, more efficient water use, and higher productivity. As part of this mandate, SADER is promoting the incorporation of sugarcane producers into welfare programs with the aim of improving their living conditions and strengthening their productive capacity.

According to the operating rules of these strategic programs, the registration period for the beneficiaries’ roster, scheduled for February and March, will also facilitate access to financing at preferential interest rates of 8.5% through the Harvesting Sovereignty program. The goal is to strengthen liquidity, productive capacity, and economic stability among Mexico’s sugarcane producers.

This benefit would significantly reduce financing costs, particularly when compared with loans provided by sugar mills, which currently carry interest rates of up to 30%. Through these initiatives, the government aims to generate a positive impact on the sugarcane sector by easing financial pressure, expanding access to strategic inputs and timely financing, and reinforcing productive sovereignty and rural well-being.

These initiatives come after a year of intense tension for the sugarcane sector. In November, producers from several states staged a blockade outside SADER’s headquarters in Mexico City. Protesters from Veracruz, Morelos, San Luis Potosi, Puebla, and other states accused the federal government of being responsible for losses during the 2023–2024 and 2024–2025 harvest seasons, which they attributed to high levels of sugar imports.

According to producers, losses during those periods reached MX$300/t (US$17.39), as authorities authorized the importation of large volumes of foreign sugar. This has generated strong discontent within the sector, whose members argue that Mexico has historically been self-sufficient in sugar production, making imports unnecessary and harmful to the domestic market.

Claudia Fernández, Executive President, National Chamber of the Sugar and Alcohol Industry (CNIAA), highlighted that between January and October 2025, more than 350,000t of sugar entered the country through so-called technical smuggling, triggering a sharp decline in prices.

Fernández noted that sugar smuggling has resulted in losses of MX$25 billion for the sector, while sugarcane producers alone have seen their income reduced by MX$15 billion. She emphasized that the sugarcane agroindustry generates 500,000 jobs, benefits more than 2.4 million people across Mexico, and includes over 46 sugar mills operating in 15 states.

“Each year, more than 5Mt of sugar are produced, but unfortunately, in recent years there has been a significant increase in both outright and technical smuggling. Technical smuggling takes advantage of legal loopholes, as the law is not clear and importers abuse these mechanisms,” Fernández explained.

In this context, Fernández expressed support for the amendments to the Customs Law enacted by the federal government in November 2025, which updated the import tax framework for sugar. Under the new regulation, the previous specific tariffs, ranging from US$0.338/kg to US$0.39586/kg, were replaced by ad valorem tariffs of 156% for raw sugar, beet sugar, or syrup, and 210.44% for liquid, refined, and inverted sugar imports. The measure is expected to help curb illegal imports from Brazil, Guatemala, and India.

The Agricultural Markets Consulting Group (GCMA) acknowledged that the measure is appropriate but insufficient to fully rebalance the market. The group argued that additional protections are needed for domestic producers, including an expansion of the US import quota for Mexican sugar and negotiations by the Ministry of Economy to establish a mechanism equivalent to the volume of imported high-fructose corn syrup (HFCS)

Concerns have also grown within the industry over the sharp rise in HFCS consumption, which producers say poses health risks. René González, Representative of the Plan de San Luis sugar mill, noted that while imports initially stood at around 200,000t per year, they now exceed 1.2Mt annually.

González underscored that this sweetener, used in products such as soft drinks, jams, cookies, and sauces, has significantly displaced domestic sugar, affecting both producer incomes and consumer health. “Sugar consumption has been demonized, when in reality what people are no longer consuming is cane sugar. Per capita sugar consumption has fallen, but diseases such as Type 2 diabetes and childhood diabetes have increased. This should set off alarm bells,” he warned.

According to González, Mexico produces approximately 6Mt of sugar per year, while domestic consumption stands at around 5.5Mt. However, with the influx of corn syrup, nearly 1.2Mt of Mexican sugar have been displaced from the market, creating a serious imbalance. At the same time, US trade restrictions have limited Mexican sugar exports, further exacerbating the situation.

“If we multiply the excess 1 million mt by the current price of MX$15,000/t, we are talking about more than MX$15 billion in losses for the national sugar sector,” González warned.

Against this backdrop, the sugarcane sector, with support from national organizations, is seeking to launch a consumer information campaign aimed at clearly distinguishing products made with cane sugar from those containing corn syrup. The initiative involves producers from at least 15 sugar-producing states, including Veracruz, Jalisco, Sinaloa, Tamaulipas, and Yucatan.

González underscored that rather than prioritizing new international markets, the main objective should be to reorganize and strengthen domestic consumption. This approach would help prevent overproduction, stabilize prices, and ensure fair incomes for sugarcane producers. “There is no need to export if we can get the Mexican market to consume what we produce. It is a matter of economic justice and public health,” he said.