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BY CRISTINA ADAMS Need-to-know info on Mexico’s top growing regions 4 Blueprints Supplement | Oct/Nov/Dec 2017 Hispanic Hot Commodities LOCAL FORECAST L ike many partners with a long history, Mexico, the United States, and Canada enjoy a relation- ship that’s often fraught with highs and lows. Given the current political climate, this isn’t likely to change anytime soon. One thing is indisputable: the three countries are essential trading partners, espe- cially when it comes to agriculture.

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Page 1: Supp MX Local Forecast Article1 - WordPress.com · 2018. 3. 5. · It’s no surprise Mexico dominated U.S. agricultural imports in 2016, at nearly 20 percent, surpassing Canada as

BY CRISTINA ADAMS

Need-to-know info on Mexico’s top growing regions

4 — Blueprints Supplement | Oct/Nov/Dec 2017 Hispanic Hot Commodities

LOCAL

FORECAST

Like many partners with a long history, Mexico,the United States, and Canada enjoy a relation-ship that’s often fraught with highs and lows.

Given the current political climate, this isn’t likely tochange anytime soon. One thing is indisputable: thethree countries are essential trading partners, espe-cially when it comes to agriculture.

Page 2: Supp MX Local Forecast Article1 - WordPress.com · 2018. 3. 5. · It’s no surprise Mexico dominated U.S. agricultural imports in 2016, at nearly 20 percent, surpassing Canada as
Page 3: Supp MX Local Forecast Article1 - WordPress.com · 2018. 3. 5. · It’s no surprise Mexico dominated U.S. agricultural imports in 2016, at nearly 20 percent, surpassing Canada as

It’s no surprise Mexico dominated U.S.agricultural imports in 2016, at nearly 20percent, surpassing Canada as the U.S.’stop ag supplier.

Nearly 60 percent of Mexico’s ag ex-ports go to the United States, with freshproduce accounting for $10.5 billion ofthis total in 2016. This steady pipeline ofexports has propelled Mexico to a newranking as the 12th-largest food producerin the world.

Here’s a look at Mexico’s vast and variedgrowing regions and how producers arerising to the challenge of supplying NorthAmerica’s ever-increasing appetite for freshfruits and vegetables on a year-round basis.

A History of Cultivation

Agriculture has played a key role inMexico’s history for thousands of years.Mesoamerican civilizations, includingthe Olmecs, Mayas, and Aztecs, relied

on agriculture as a foundation of theirsocieties. Among their staple crops werethe “three sisters”—winter squash,beans, and corn—which are still culti-vated in abundance today.

But curious palates and a boomingpopulation at home and abroad havepushed other crops ahead of the tradi-tional sisters: chile peppers, bell pep-pers, cucumbers, tomatoes, citrus,berries, avocados, and a wide range oftropical fruits have exploded in popu-larity in recent years.

In response, Mexican growers acrossthe country—along with theirCanadian and U.S. partners—haveconsiderably stepped up production tomeet demand.

Many Regions, More Produce

Mexico encompasses about 742,000square miles, and more than half of this

6 — Blueprints Supplement | Oct/Nov/Dec 2017 Hispanic Hot Commodities

LOCAL FORECAST

“Nowhere is the proliferationof produce more evident than

at La Central de Abastowholesale center in MexicoCity. It opened on the east

side of the capital city in1982 to help ease the over-flowing consumer and busi-ness traffic at downtown’sMerced Market, the city’s

main market.”-----------------------

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land is used for agricultural produc-tion, which includes ranching as well as farming operations.

Generally speaking, the country can be divided into six principal growing regions—the Baja Peninsula,the Gulf of Mexico and South, El Bajío and central Mexico, northernMexico, the Pacific Coast, and the Yucatán Peninsula—each of which features a different climate and geography.

Top producers

While many of the country’s farmingregions produce an abundance of crops,a few top the competition.

Among them are Baja California andBaja Sur in the Baja Peninsula, which isknown for its berry and tomato pro-duction; the Pacific Coast, home to the‘breadbasket’ states of Sonora and to itssouth Sinaloa; and El Bajío, in the low-lands of central Mexico.

Geography and climate

When it comes to climate and geogra-phy, every growing region boasts some-thing different. Such variations guaranteeyear-round cultivation and a steady sup-ply of exportable crops from somewherein Mexico (for a more in-depth look atclimates and microclimates, see our side-bar on the next page).

The Baja Peninsula, for example, is sunny, arid, and occasionally rain-starved with an ideal climate and terrainfor certain crops like grapes, berries, and peppers.

Then there’s the Yucatán Peninsula, withthe states of Yucatán, Campeche, andQuintana Roo. With thinner soil and semi-tropical weather, these states are better suit-ed to growing squash, beans, and variousroot vegetables. This particular region is farbetter known for its resorts and beachesthan fruit and vegetable production.

Growers in the northern and north-western states of Chihuahua, Coahuila,

Oct/Nov/Dec 2017 | Blueprints Supplement — 7www.producebluebook.com

LOCAL FORECAST

“The market is so sprawling it has its own

police force and postal code, as well as numerous restaurants,

gas stations, bank branches,

government offices, and even its own soccer league.”

-----------------------

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Sonora, and Sinaloa all employ irrigationsystems, as the area is dry despite regularrain during the winter.

Along the Pacific coast are the states ofNayarit, Michoacán, Guerrero, and part ofJalisco, which count many popular touristdestinations like Puerto Vallarta andAcapulco among their better known cities.

South and Central

Further south, the states of Oaxaca andChiapas, both home to large indigenouspopulations, range from semi-arid plateauand rainforest to mountainous highlands(at press time, this region had experienceda deadly earthquake near Chiapas andOaxaca, the worse to hit the country innearly a century).

Located on the Gulf of Mexico are the produce-growing states of Veracruzand Tamaulipas, and in the central part ofthe country is El Bajío, which includes thestates of Querétaro, Guanajuato,Aguascalientes, and parts of Jalisco.

The Mother ofAll Markets

Nowhere is the proliferation of pro-duce more evident than at La Central deAbasto wholesale center in Mexico City,the country’s capital most populous met-ropolitan area.

La Central de Abasto opened on the east side of the capital city in

Hispanic Hot Commodities8 — Blueprints Supplement | Oct/Nov/Dec 2017

Mexico has seven distinct climate regions which can be divided intothree groups: tropical, dry, and tem-perate, and each of these has its own microclimates.

Tropical regions have two micro-climates: tropical wet and tropicalwet-and-dry. The former is foundalong the Gulf Coast in the states ofVeracruz and Tabasco, as well as inOaxaca and the highlands ofChiapas.

Tropical wet-and-dry differs in that itfeatures an actual dry season; thiscategory covers most of the country’sPacific coastal area and the Yuca-tán Peninsula.

The two dry climates are arid, adesert climate that can experiencefreezing winters; and semi-arid, whichreceives more rain, mostly during thesummer months.

Mexico’s arid regions include most ofBaja California, parts of Sonora, andthe northern reaches of the CentralPlateau (Coahuila and Chihuahua). A semi-arid climate covers the southern section of the Central

LOCAL FORECAST

A Kaleidoscope of Climates

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www.producebluebook.com

1982 to help ease the overflowing con-sumer and business traffic at down-town’s Merced Market, the city’s main market.

Since then, La Central has grown tobecome one of the largest food marketsin the world. More than 30,000 tons offood—about 30 percent of all the foodconsumed around Mexico—passesthrough the market every day.

Spread out over 778 acres, La Central ishome to more than 2,000 small and largebusinesses, many of which still operate on acash-only basis.

The market is so sprawling and busy thatit has its own police force and postal code, aswell as numerous restaurants, gas stations,bank branches, government offices, and evenits own soccer league.

According to some of the 300,000 dailyvisitors, it can take up to 15 minutes tocross the entire market in a taxi.

A Cornucopiaof Crops

Fresh produce is one of the mainstaysof La Central and a key business for grow-ers and companies on both sides of theborder.

And while some observers wonderwhether the growth in volume of Mexicanproduce means that new regions are com-ing into play, others like Art Salinas,

Oct/Nov/Dec 2017 | Blueprints Supplement — 9

LOCAL FORECAST

Plateau, northern Yucatán, and interior regions as far south as Oaxaca.

Like Baby Bear’s porridge, the tem-perate climate is just right: not too hot,not too cold.

What differentiates the three differentmicroclimates in this group is theamount of rainfall. Temperate with drywinters means low humidity and mildtemperatures, much like the weather inmany of Mexico’s mountainous areasand in Nuevo León, and the interior ofTamaulipas, which also has tropicalweather in its coastal areas.

Less prevalent are the humid subtropical and Mediterranean climates. The former features morerainfall throughout the year and existsonly in the eastern Sierra Madre andin a limited area in the southern mountain region.

A Mediterranean climate, similar tothe California coast, is unique to thearea around Tijuana, which is dry dur-ing the summer months and gets all ofits rain in winter.

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sales manager at Pharr, Texas-basedBonanza 2001, believe current growersare simply expanding their reach.

“There aren’t really new regions,” ex-plains Salinas, whose company growsavocados and hydroponic greenhousetomatoes in Jalisco.

“They’ve always been there,” contin-ues Salinas, “but now they’ve increasedtheir acreage. Where someone had onehectare, now they have two and maybeanother greenhouse.”

Mike Righetti, managing member of Nogales, AZ-based Righetti Farms,LLC, has been in the produce businesssince 1992 importing melons, toma-toes, and foodservice mixers from thestates of Sinaloa, Sonora, Jalisco,Michoacán and Guerrero.

As Righetti sees it, there are new re-gions entering the growing arenaspecifically to bridge the period frommid-May through September. And hecredits protected agriculture for thistrend (for more information on

protected agriculture and greenhouses,see page 12).

“With the expansion of greenhousegrowing, we’re seeing people expand intoplaces like Zacatecas and San Luis Potosí,”Righetti notes. “New companies andstartups are getting involved, and productis crossing primarily into Texas.”

Exports:Going, Going, Gone

Among the top exports are tomatoes,chile peppers, citrus, tropical fruits, andof course, avocados.

The latter have enjoyed a tremendousspike in popularity over the past severalyears, and Mexico is home to the world’stop supplier—the state of Michoacán—which also produces limes, strawberries, blackberries, cantaloupe, peaches, and bell peppers.

To put this into numbers, in 2016Americans bought and consumed 2.2billion pounds of avocados, 60 percentof which came from Mexico (around 24million pounds were from domesticgrowers in California).

In recent years, Michoacán has be-come the biggest strawberry-growing re-gion in Mexico as well, ranking higherthan Baja California and Jalisco.

But the Baja Peninsula continues tobe a major player, producing 83,721tons of strawberries and blackberries in2016, largely in open-air fields.

Even so, California still supplies themost significant volume of strawber-ries—nearly 80 percent—consumed inthe United States, with Florida comingin second.

Citrus, Tropical,and Other Fruits

Like its northerly neighbor, Mexico isnot immune to the scourge of the citrusindustry: citrus greening or Huanglong-bing disease.

In Veracruz, home to most of thecountry’s orange groves, production was

Hispanic Hot Commodities10 — Blueprints Supplement | Oct/Nov/Dec 2017

LOCAL FORECAST

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www.producebluebook.com Oct/Nov/Dec 2017 | Blueprints Supplement — 11

down in 2016 even though total orangeproduction was nearly 5 million tons.While the disease still has not caused thetype of destruction found in Florida’s citrus groves, growers are tracking the disease carefully.

Limes come of age

A citrus bright spot is limes, whichhave enjoyed climbing demand in theUnited States. America’s loss—a devas-tating plague of citrus canker back in2007 which decimated the industry—has been a boon for Mexico’s growersand exporters.

Mexico is not only the top producerof limes (and lemons) in the world butthe largest supplier to the United States.Mexico’s limes are grown mostly inMichoacán, Colima, Veracruz, and Oaxaca.

Other favorites

Tropical fruits, including mangos and papaya, are also hot commodities in both domestic and foreign markets,and grow in abundance in southernstates like Chiapas and Oaxaca, as well as in Veracruz and Sonora.

Melons, too, flourish in Mexico’s various growing regions. Watermelon,cantaloupe, and honeydew grow princi-pally in Guerrero, Jalisco, Colima, and Sinaloa.

The Temperate Zone

Occupying the temperate middle ofthe country is El Bajío, an area that sitsat 5,000 to 5,900 feet above sea level.Thanks to its climate and established infrastructure, El Bajío, which means“lowlands,” is quickly expanding to be-come one of Mexico’s most criticalgrowing regions.

“A big advantage of this specific region is that the weather is usuallyperfect for the products and the quality is high,” comments EdgarGaona, whose father founded

Chihuahua-based produce import/export firm Frugasa S.A. de C.V.

“El Bajío, in particular, has the advantage that you can grow productalmost every day of the year,” Gaonasays.

Mark Vestal, president of SantaBarbara, California-based WesternPacific Produce, Inc., grows vegetablesincluding broccoli, snow peas, carrots,and Napa cabbage in both Guanajuatoand Puebla. “Because of the altitude,it’s cool and we have good growingconditions,” he explains.

Labor may be cheaper, but lessmechanization means more labor.Good farmland is about the same price,and fuel costs the same, too.

Weather can be an advantage, butfor some U.S. suppliers growing cropsin Mexico, it’s about simplification. “Itdoes not cost me less to do businessdown in Mexico,” admits Vestal, but hesays it is less complicated than navigat-ing California’s many regulations.

LOCAL FORECAST

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Protected Agriculture

As of late 2016, there were about22,000 acres of protected agriculture in Mexico, consisting of greenhouses and various ‘protected’ structures like high tunnels or shade houses. Most of these structures can be found in thecoastal states of Sinaloa, Jalisco, and Baja California.

According to the Mexican Associationfor Protected Horticulture, the country’sprotected agriculture has been growing atan annual average rate of 3,600 acres forthe past few years.

Tomatoes, cucumbers, and chiles ac-count for the bulk of crops grown underprotection, although lettuce, herbs, andbell peppers aren’t far behind.

Methods and technology

Frugasa’s Gaona says he’s seen a sizableincrease in high tunnels, greenhouses, andshade cloth.

Bonanza 2001’s Salinas concurs, not-ing that while the protection doesn’t guar-antee an issue-free crop, it offers peace ofmind that most field cultivation can’t.

“We do worry about hurricanes, butour main concern is quality control andmarkets,” Salinas shares. “The technologyis better now, and the greenhouses aremore affordable, so more people are will-ing to invest.”

Righetti agrees, noting that he sourcesfield- and greenhouse-grown product,and the trend is booming across Mexicodespite the often substantial upfront capi-tal investment.

Conditions and yields

Not only does greenhouse growingoffer protection from cooler tempera-tures and inclement weather, it also al-lows growers to improve conditions inareas with marginal soil types.

“The ability to grow in better con-ditions means better yields,” Righettiopines. “If you’re buying productdown in Mexico, a big percentage of itwill be greenhouse; there’s no wayaround it.”

But it’s not just Mexico that’s seeinga proliferation of protected agriculture.The number of greenhouses going upin the United States, and Canada—North America’s greenhouse titan—hasalso been increasing, as field growers inthese countries segue to greenhousesand the like.

Though it certainly ups the competi-tion, there’s little doubt consumers will

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LOCAL FORECAST

“We do worry about hurricanes, but our main concern is quality control

and markets.”------------------

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come out as the winners with nearlyperfect produce, time after time, withless interference from Mother Nature.

The Future is Now

Although major growing regions arewell established and expansion tendsto be in protected agriculture ratherthan the open field, Mexico remains aland of opportunity for buyers andsellers alike.

Partnering for profit

With its varying terrain and a tem-perate climate, Mexico offers U.S. andCanadian grower-shippers and distrib-utors plenty of options for year-round access to a broad range of fresh fruit and vegetables.

That said, weather can still be anissue for many growers, even inMexico—as evidenced by the recentspate of hurricanes and tropical stormsin late summer and early fall.

One of Righetti Farms’ specialties,for example, is melons, which preferwarm and dry growing conditions—but not too hot.

In 2016 the stars aligned for idealweather and an excellent crop; unfor-tunately, that also meant there was toomuch product, more than the marketcould support.

This can also happen with climatevariations that either shorten or length-en the season, creating overlaps andcompetion with U.S. or other growingregions.

“Historically, we’ve had fixed startand stop dates,” Righetti explains.“The challenge with global warming isthat areas are getting ready sooner.Now things are off by two weeks, be-hind or early, and it’s because theweather conditions are different.Weather drives the deal.”

Nevertheless, for those at the mercyof seasonal weather or extreme temper-ature swings, partnering with Mexico isa smart business decision.

As Pacific Produce’s Mark Vestal,puts it, “If you’re going to be a buyer,you need to have Mexico as part ofyour program—that’s the future.”

www.producebluebook.com

Image: Richard Laschon/Shutterstock.com

LOCAL FORECAST

“The ability to grow in better conditions

means better yields.”- - - - - - - - - - - - - - - - - -

Cristina Adams is a freelance writer andeditor with more than 20 years of experi-ence. She writes for a number of businesspublications and websites.

Oct/Nov/Dec 2017 | Blueprints Supplement — 13