Mexico's Agri-Food Outlook for 2024: GCMA

In 2024, Mexico is projected to become the ninth-largest global producer of agri-food, while securing the seventh position as a food exporter, as revealed in the Agri-Food Outlook 2024 annual report. In 2023, various factors, including drought, influenced the agri-food landscape.

The report, issued by the Agricultural Markets Consulting Group (GCMA), estimates that Mexico will produce a total of 113.5Mt of agri-food products in 2024, marking a 1.7% annual growth. This achievement would propel the country to the ninth position in the global food production ranking, surpassing Canada, which holds the tenth spot with 109.5Mt. 

China is expected to maintain its top position with 1,449 Mt, followed by India with 829.9Mt, the United States with 817Mt, the European Union with 664Mt, Brazil with 463.3Mt, Russia with 248.6Mt, Argentina with 168.1Mt, and Ukraine with 125.3Mt. This category encompasses grains, oilseeds, agro-industrials (including beer, tequila, chocolate, etc.), fruits, vegetables, forages, and animal protein.

Regarding exports, Mexico advanced two places in the ranking, reaching the seventh position. In 2023, agri-food exports surpassed US$51 billion, reaching the highest nominal figure to date. For 2024, sales are estimated to reach US$55.2 billion, an 8% increase from 2023. Mexican food exports reach over 190 countries, yet more than 80% of the exported value remains in North America due to agreements established through USMCA, according to data from the Agricultural and Fisheries Information Service (SIAP).

Conversely, imports amounted to US$42.4 billion by the end of the year, showing an increase in both value and volume compared to 2022. This uptick in imports is linked to factors such as drought, which reduced domestic production, and a favorable exchange rate that facilitated lower-cost imports. However, a reduction in purchases is anticipated in 2024, yielding favorable results in trade balance, with the trade surplus expected to reach approximately US$9.3 billion.

During the presentation of the study, Carlos Anaya, General Director, GCMA, highlighted challenges ahead. In the case of drought, he detailed its impact on sugar production, leading to a significant drop and an increase in sugar imports. Moreover, the rise in fertilizer costs also contributed to a 9% decrease in sugar production last year. 

In 2023, drought conditions and water scarcity in the northern region of the country affected the production of grains and oilseeds, such as corn, wheat, beans, and soybeans. For 2024, a 6.6% decline in corn production is anticipated, with sorghum expected to decrease by 4.2%, wheat by 19.2%, and only beans projecting an increase of 61%, stressed Anaya.

The horticultural sector emerges as the strongest in the Mexican market, displaying relative stability in terms of increased cultivated area, production, exports, and consumption. The report highlights Mexico's prominence as one of the primary global producers and exporters of a diverse array of products, including tomatoes, avocados, berries, melons, asparagus, cucumbers, mangoes, chili peppers, and bell peppers. In 2024, a 2% increase in fruit production is expected, compared to the end of 2023, while vegetables will grow by 1%.

According to GCMA, Mexico boasts a food self-sufficiency index of 91%, achieving remarkable margins of 246% and 223% for avocados and tomatoes, respectively. However, the situation is concerning for grains in the country, with production falling below 50% (47%) for the first time. The livestock sector reports a self-sufficiency level of 81%, encompassing the production of milk, chicken, eggs, beef, and pork. 

The report underscores the ineffectiveness of agricultural policies implemented by the current administration, emphasizing the need for measures to enhance production and ensure an adequate food supply for the growing population. “These findings show that the agricultural policies enforced by the current administration have proven ineffective. There is a pressing need to adopt measures aimed at enhancing production and ensuring a sufficient food supply for the expanding population,” highlights the report.