Mexico’s Economic and Agricultural Outlook

Mexico is a major international economy and member of the G20, which brings together the twenty largest economies in the world. With a gross domestic product (GDP) of more than US$2 trillion, Mexico’s national economy is divided into 4% agriculture, 33% manufacturing industry, and 63% services. Given Mexico’s large population of over 120 million citizens and its growing urban middle class, the country stands as the second largest consumer market in Latin America, after Brazil. In terms of agriculture, Mexico’s main agricultural products are corn, wheat, soybeans, rice, beans, cotton, coffee, fruit, tomatoes, beef, poultry, dairy products, and wood products. Furthermore, as a member of both the North American Free Trade Agreement (NAFTA) and the Pacific Alliance, Mexico has preferential access to almost all of the national markets within the western hemisphere. This article explores the status of the economy as well as the agriculture industry in Mexico.

Mexico’s Economic and Agricultural Outlook

Overall, Mexico’s economy during the last several years has reported either a trade balance or a slight trade deficit at about US$360 billion worth of imports and exports respectively. Within the agriculture sector, as with the Mexican economy in general, the United States represents the most important trade partner. In 2015, Mexico imported almost US$860 million worth of fruits and nuts from the US. The second largest supplier of fruits and nuts to the Mexican market during 2015 was Chile with a total of approximately US$110 million. Other import into Mexico categories within which the US represents the largest supplier are dairy, bovine meat, and poultry products. Meanwhile, Spain and France dominate the grape and wine import categories, with a combined total of more than US$100 million in imports to Mexico during 2015.

Similarly, the US is seeking to export pulses to Mexico, having led an intensive campaign during 2016, which was the international year of pulses. Between 2007 and 2015, Mexico represented the largest international market for US-produced pulses, accounting for more than US$1 billion in trade throughout the eight-year period. During 2015, Mexico imported approximately 100.000 metric tons worth of pulses from the US; however, this amount increased to more 150.000 metric tons in 2016. The reason why the United Nations Food and Agriculture Organization (FAO) highlighted pulses during 2016 and why they have economic potential within the Mexican market is their nutritional value.

Corn products as well as beans and rice dominate the traditional Mexican diet. However, given the numerous advantages that pulses present, both as a crop and as a food item, the FAO highlights its benefits particularly within developing and middle-income nations. Firstly, the cultivation of one-pound worth of pulses only requires 44 gallons of water, compared to the more than 200 gallons of water required to grow one-pound of soybeans. Likewise, pulses do not render the land upon which they are cultivated sterile; on the contrary, pulses contribute to the soil’s fertility. Finally, pulses have low fat and caloric contents, have no cholesterol, and are a good source of zinc, protein, iron, and fiber. In short, pulses represent an agricultural product with great potential to combat global malnutrition.

(Read more about Citrus Production and Markets in Costa Rica)