Mexico Archives - U.S. Wheat Associates

Image shows grain rail cars by a country elevator to illustrate USW comments to the Surface Transportation Board.

ATP Program Brings Mexican Buyer to U.S. for Rail Shipping Observation

U.S. Wheat Associates (USW) recognizes that direct rail shipments of U.S. wheat to millers in Mexico provides a significant advantage over competing wheat exporting countries. USW has been increasing its efforts to facilitate these types of sales by educating Mexican buyers about the rail shipping process and efficiencies.

In June 2022, USW’s Mexico City Office used Agricultural Trade Promotion Program (ATP) funds to organize and lead a trade team from a Mexican company that is a major buyer of U.S. wheat to meet with U.S. farmers, grain cooperatives and grain elevators in Ohio and Kansas that have direct rail shipment capabilities. The trade team included the company’s wheat purchasing manager and production manager.

Improved Infrastructure

Expansion of U.S. exports to the market via rail has been made possible by significant investments and dramatic improvements in the Mexican rail infrastructure over the last 15 years. Today, there are 46 shuttle train facilities, including 9 new facilities that were inaugurated in 2020-2022, and 12 milling companies have the capacity to receive shuttle trains.

Along with demonstrating the capabilities of shipping U.S. wheat directly to mills in Mexico, the trade team led by USW was educated on the quality and supply of U.S. soft red winter (SRW) wheat and hard red winter wheat (HRW).

As a result of discussions with the trade team – both during and after the visits to Ohio and Kansas – the company bought SRW for the first time in more than three years. The estimated total for the 44,160 metric tons (MT) of SRW purchases that resulted from the trade team was $15.7 million.

June 29, 2023/by Steve Mercer

Canimolt, Foreign Agricultural Service, Mexico, U.S. wheat, U.S. Wheat Associates, U.S. wheat exports, U.S.-Mexico-Canada Agreement, USMCA, Vince Peterson Hard Red Spring, Hard Red Winter, Hard White, Soft Red Winter

Renewing a Partnership of Affection and Action with Mexican Flour Millers

USDA Foreign Agricultural Service cooperator U.S. Wheat Associates (USW) held its 2019 Mexico Wheat Trade Conference June 2 to 4, 2019, which was perfectly timed to address trade policy concerns face to face with Mexican customers.

USW President Vince Peterson noted that the conference showed USW and its Mexican customers that shared challenges could bring them closer together to help navigate the policy issues and increase the efficiency and value of Mexico’s U.S. wheat purchases.

In marketing year 2017/18, U.S. wheat share of Mexico’s record total wheat imports declined. Representatives of Mexico’s milling association stated that new political rhetoric and trade policies prompted them to increased Russian and Canadian wheat imports and for the first time some wheat from Argentina. USW shared several public statements about the U.S. trade policies that helped reassure the buyers of the on-going commitment to service supported by the Market Access Program (MAP) and Foreign Market Development (FMD) program. In fact, USW has reason to believe this effort helped keep U.S. wheat off Mexico’s retaliatory tariff list related to U.S. steel and aluminum tariffs.

However, USW remained concerned that the relationship with Mexico’s millers remained precarious. In addition, approval of the new United States-Mexico-Canada Agreement (USMCA) on Trade was also uncertain. To help overcome these potential constraints, USW planned the Mexico Wheat Trade Conference that included many farmers and administrators representing state wheat commissions. The conference speakers covered a wide range of wheat quality, purchasing and logistical topics over two full days.

With so many logistical options for delivering wheat to Mexico, USW Regional Vice President Mitch Skalicky and his colleagues based in Mexico City who planned the conference emphasized commercial rail issues and opportunities in the program.

The flour millers that attended the conference in Cancún represented about 80% of the total 2018/19 U.S. wheat commercial sales to Mexico reported by USDA. José Luis Fuente is president of the millers’ national association and offered an inspired appeal to work together to tell officials in both countries that export opportunities must be improved, not restricted. He said his members know that U.S. wheat farmers, USW and USDA have done many things to tell that story. He added that this is a partnership based on affection that is backed by actions, but actions are more needed now in this unusual trade environment.

In marketing year 2018/19, Mexican flour millers did import 3.3 million metric tons (MMT) of U.S. wheat, more than any other country. Mexican millers continue purchasing U.S. hard red winter (HRW), soft red winter (SRW), hard red spring (HRS) and hard white (HW) at a fast pace in 2019/20.

Video reports from the USW Mexico Wheat Trade Conference are posted on YouTube at https://www.youtube.com/user/USWheatAssociates.

June 20, 2019/by Erica Oakley

A Latin American and Caribbean Buyers Conference June 2016 in Portland, OR, sponsored by USDA Foreign Agricultural Service cooperator U.S. Wheat Associates (USW) with Market Access Program (MAP) funding and support from 9 state wheat commissions, set the stage for incremental wheat exports by 75 flour millers and buyers from 16 countries.

The increasingly competitive global wheat market puts a premium on in-person trade service and technical support to differentiate wheat supplies. The 2016 Buyers Conference created a collegial opportunity for wheat buyers to meet with farmers, U.S. based grain traders and technical experts on local supply chain visits, in seminar sessions and social activities. USW arranged for speakers on a range of relevant topics including U.S. wheat quality trends, logistics management, plant breeding methods and other key wheat price drivers that address specific constraints on U.S. wheat sales to these growing markets.

By increasing the basic knowledge of how to purchase U.S. wheat, for example, a flour miller in Haiti bought their first two shipments ever of U.S. hard red winter (HRW) after the conference, with plans to import more HRW. The miller noted that meeting with traders and millers at the conference opened talks about possible joint purchases. Two participants from a new flour mill in Honduras said they now have better information to consider additional U.S. wheat purchases from Pacific Northwest ports. An experienced Colombian buyer said seeing the whole process from varietal development to the farm and supply system was “amazing” and definitely increased his confidence in U.S. wheat quality and reliability.

To help overcome regional preferences for Canadian wheat, master baker Didier Rosada presented (in Spanish) evidence that blending two or more U.S. wheat classes can be less expensive and improve end-product quality. With this information and discussions at the conference, a large Costa Rican miller and food processor indicated it would likely increase U.S. soft white (SW) wheat imports for blending.

While it is not possible to quantify all additional U.S. wheat exports directly related to the 2016 conference, 2016/17 sales to Mexico, Central America and the Caribbean of 6.3 million metric tons (MMT) are up 23 percent over 2015/16. Sales of 3.5 MMT of U.S. wheat to South American markets represent a 70 percent increase in 2016/17 over the prior year.

Overall, the effort to identify how world market dynamics made U.S. wheat an attractive choice was a timely message for Latin American buyers. To help meet the growing demand for new and better wheat food products in the region they increasingly buy based on the kind of quality characteristics U.S. wheat classes offer. A survey of buyers at the 2016 conference showed that 64 percent believed the experience will help them compare U.S. wheat quality, while 70 percent said it would help them compare U.S wheat value, to competing origins. These are key objectives for USW in its trade service and technical support activities funded by the MAP and Foreign Market Development (FMD) program.

December 31, 2017/by Amanda Spoo

U.S. Wheat Associates (USW) represents the interests of U.S. wheat farmers in international markets. As it does with all U.S. wheat importing customers, USW focuses on helping Mexico’s buyers, millers and food processors solve problems or increase their business opportunities with U.S. wheat classes. This effort, supported by wheat farmers and the partnership with the Market Access Program (MAP) and Foreign Market Development (FMD) program, has fostered a productive relationship that has endured for decades through many challenges. More than 22 years of duty free access to the Mexican market under the North American Free Trade Agreement (NAFTA) certainly helped build the relationship.

Mexico is one of the largest U.S. wheat buyers in the world, importing just under 3.0 million metric tons (MMT) on average going back many years. Not in marketing year 2016/17, however. As of May 18, 2017, Mexico’s flour millers had imported more than 3.3 MMT of U.S. wheat, which is more than any other country. That volume is up 39 percent over last year at the same time.

Breaking down their purchases by class, flour millers in Mexico generate strong demand for U.S. hard red winter (HRW) wheat. In 2015/16, they were the leading HRW importers and are taking advantage of the favorable prices and high quality of the 2016/17 HRW crop. At a current volume of about 2.0 MMT, they have imported 79 percent more HRW this year and again lead buyers of that class. The association representing Mexican flour millers says a rising number of industrial bakeries, along with traditional artisanal bakeries, account for about 70 percent of the country’s wheat consumption. That puts HRW producers in a good position to meet that demand. Being closer to HRW production and having a highly functioning ability to import a large share of HRW directly via rail and duty free from the Plains states is an advantage for Mexico’s buyers.

In addition, Mexico is home to Bimbo, the world’s largest baked goods company, and an increasing number of cookie and cracker companies. The functional properties of U.S. soft red winter wheat (SRW) is well suited to the production of cookies, crackers and pastries, and serves as an excellent blending wheat. Millers supplying this growing market imported an average of 1.2 MMT of SRW between 2011/12 and 2015/16. With imports from the Gulf of more than 1.0 MMT of SRW in 2016/17, Mexico was the top buyer of SRW again. USW and state wheat commissions from the PNW are also helping demonstrate how millers and bakers can reduce input costs by using U.S. soft white (SW) as a blending wheat for specialty flour products.

The successful story of how U.S. wheat farmers and their customers in Mexico have worked together in a mutually beneficial way and, for now, U.S. wheat continues to flow to our customers in Mexico.

December 31, 2017/by Amanda Spoo

ATP Program Brings Mexican Buyer to U.S. for Rail Shipping Observation

Improved Infrastructure

Renewing a Partnership of Affection and Action with Mexican Flour Millers

Latin American Buyers Conference Builds Knowledge Base for Future U.S. Wheat Exports

Mexico is a Loyal and Very Important U.S. Wheat Buyer

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