Mexico to Remain Top Agri-Food Trading Partner of the US in 2024

Mexico will remain the top agri-food trading partner of the United States for the 2024 marketing season, concluding on September 30, as reported by the US Department of Agriculture (USDA).

According to the USDA’s Outlook for Agricultural Trade for Fiscal Year (FY) 2024, imports from the Western Hemisphere rose to US$121.4 billion, reflecting a 5% increase from FY23. Growth largely comes from Mexico, Canada, and South America, reported the US agency. Mexico occupied first position in the 2023 season among foreign suppliers of agricultural and agro-industrial products to the US market, reaching US$47.8 billion, a 7% increase over the past year.

A significant share of that growth comes from horticultural products, especially processed food, beverages, and fresh fruits. In 2023, the category of beverages, spirits, and vinegar grew 1.1% to US$11.5 billion, with malt beer leading exports to the United States, with record sales of nearly US$5.7 billion, followed by tequila, with US$4.3 billion. Meanwhile, the value of fruits and edible nuts grew 3.5% to US$10.5 billion. Avocado dominates this category, with shipments worth US$2.7 billion, while berries (strawberries, raspberries, blueberries, etc.) accounted for US$1.9 billion.

Similarly, vegetable imports grew 7% to US$9.2 billion, with tomatoes leading sales at US$2.7 billion, followed by peppers in all their varieties, with revenue of over US$1.5 billion. Regarding tomato trade, the US Department of Commerce announced that it is examining the possibility of imposing tariffs on Mexican tomato imports under dumping allegations, as reported by MBN. If imposed, Mexican producers would face a 21% export tariff, affecting their economy as well as that of US consumers, considering Mexico accounts for over 90% of US tomato imports. In 2022, Mexico exported 1.8Mt of tomatoes to the United States, with a wholesale market value of US$2.4 billion.

The USDA report underscored that higher unit values of fruits have driven increases in import value, which can be partially explained by supply constraints associated with drought in some growing regions. Moreover, sugar imports from Mexico, the United States’ largest supplier, are forecasted to decrease in FY24 due to historically low production.

On the flip side, USDA projections indicate that Mexico will remain the top destination for US agri-food exports, with an estimated year-on-year growth of 1.6% in the 2024 cycle, reaching US$28.2 billion. In Mexico, the primary US products consumed are corn, soybeans, pork, milk, wheat, poultry, fructose, beef, and cheese. Between January and November 2023, Mexico imported 18.2Mt of corn, with 88.3% of total purchases sourced from the United States, 9.6% from Brazil, and the remaining 2.1% from South Africa, Canada, and Argentina, as reported by the Agricultural Markets Consulting Group (GCMA).

During the first two months of 2024, Mexico's commercial activities with the United States reached a record high, displacing China as the top exporter to the northern country. Among the most sold products to the United States are cars and auto parts, electronics, oil, and agricultural products. In the agricultural sector, Mexico has a significant advantage over China, as for every dollar the Asian country sells to the US, Mexico sells US$45, according to data from Expansión.