Report Highlights:

Production for marketing year (MY) 2015/2016 is forecast to be down for wheat, sorghum and rice while the corn production forecast remains unchanged. Mexican sorghum production in particular has been plagued with a serious sugarcane aphid infestation resulting in reduced crop yields. MY 2015/2016 corn imports are projected to be slightly higher.

Wheat

Production

The Post/New MY2015/16 (July/June) wheat harvested area and production forecasts have been revised slightly downward from USDA/Official forecasts based on updated information from Mexico's Secretariat of Agriculture, Livestock, Rural Development, Fisheries and Foodstuffs (SAGARPA) as of December 31, 2015.

Stocks

The Post/New ending stocks estimate for MY2015/16 (555,000 MT) is lower than the USDA/Official estimate as a result of lower-than-expected production.

Mexico, Wheat Production, Supply and Demand for MY2013/14 to MY2015/16

Wheat

2013/2014

2014/2015

2015/2016

Market Begin Year

Jul 2013

Jul 2014

Jul 2015

Mexico

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

638

638

707

707

823

818

Beginning Stocks

275

275

316

316

495

495

Production

3377

3377

3687

3687

3780

3760

MY Imports

4636

4636

4446

4446

4400

4400

TY Imports

4636

4636

4446

4446

4400

4400

TY Imp. from U.S.

3156

3156

3065

3065

0

3250

Total Supply

8288

8288

8449

8449

8675

8655

MY Exports

1322

1322

1104

1104

1100

1100

TY Exports

1322

1322

1104

1104

1100

1100

Feed and Residual

350

350

400

400

400

400

FSI Consumption

6300

6300

6450

6450

6600

6600

Total Consumption

6650

6650

6850

6850

7000

7000

Ending Stocks

316

316

495

495

575

555

Total Distribution

8288

8288

8449

8449

8675

8655

(1000 HA) ,(1000 MT)

Sorghum

Production

FAS/Mexico has lowered the total sorghum production and harvested area estimates for MY 2015/16 due to the severe infestation of the sugarcane aphid (SCA) in Guanajuato, the second most important producer state in the country. According to official sources, Guanajuato's sorghum production was reduced by at least 43 percent from the initial production estimate of the 2015 Spring/Summer crop cycle (1.5 MMT). These sources stated that the SCA infestation produced a reduction in crop yields, harvest efficiency reduction, and in some areas severe crop loses. Guanajuato alone accounts for approximately 36 percent of Mexico's spring/summer crop cycle. Similarly, FAS/Mexico has decreased the estimates for harvested area based on the most recent data from SAGARPA.

Consumption

For MY2015/16, the sorghum total consumption estimate has also been revised downward compared to the USDA/Official figure, based on information from private sources who expect the livestock sector to see sorghum prices as less attractive in this marketing year. These contacts estimate that the lower domestic production than was previously anticipated would increase domestic sorghum prices further and magnify a decrease in demand for animal feed.

Stocks

The Post/New estimated ending stocks for MY 2015/16 have been lowered in response to reduced production.

Mexico, Sorghum Production, Supply and Demand for MY2013/14 to MY2015/16

Sorghum

2013/2014

2014/2015

2015/2016

Market Begin Year

Oct 2013

Oct 2014

Oct 2015

Mexico

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

2073

2073

1715

1715

1800

1700

Beginning Stocks

285

285

647

647

338

338

Production

8500

8500

6270

6270

7150

6600

MY Imports

162

162

29

29

500

500

TY Imports

162

162

29

29

500

500

TY Imp. from U.S.

162

162

29

29

0

500

Total Supply

8947

8947

6946

6946

7988

7438

MY Exports

0

0

8

8

0

0

TY Exports

0

0

8

8

0

0

Feed and Residual

8200

8200

6500

6500

7500

7100

FSI Consumption

100

100

100

100

100

100

Total Consumption

8300

8300

6600

6600

7600

7200

Ending Stocks

647

647

338

338

388

238

Total Distribution

8947

8947

6946

6946

7988

7438

(1000 HA) ,(1000 MT)

Corn

Production

The Post/New corn production and area harvested estimates for MY 2015/16 (October to September) have remained unchanged, based on updated official data from SAGARPA.

Despite media reports that stated Sinaloa's corn production was negatively impacted by cooler weather registered in late December 2015, official sources stated that the damages were not significant. Officials stated that the negatively affected areas represented a very low percentage in relation to the total area planted. For example, the area affected in Sinaloa by the cooler weather was estimated to cover approximately 14,000 hectares in the 2015/16 fall/winter crop production cycle. However, that affected area encompassed partial damages that occurred not only to corn but also to planted areas of dry beans, potatoes, and some vegetables. In addition, it is estimated that Sinaloa corn growers would plant approximately 488,000 hectares in the 2015/16 fall/winter crop cycle. Sinaloa continues to be the main source of commercial white corn production in Mexico for the fall/winter crop cycle, representing approximately 70 percent of total fall/winter crop production.

Trade

The Post/New total corn import estimate for MY 2015/16 has been revised slightly upward from USDA/Official data to 11.3 MMT. Private and official sources stated that Mexican feed grain importers have opted to import higher levels of feed corn instead of sorghum, as the price difference has continued to be more favorable to corn in the last few months. Moreover, it is expected this trend will continue for the rest of the marketing year. Similarly, other key corn importers, such as starch companies, have argued that due to the reduced domestic supply as well as the excess of humidity on much of the domestic yellow corn crop, they would rather import US yellow corn during the rest of this marketing year.

Consumption

The Post/New total corn domestic feed consumption estimate for MY 2015/16 has been revised upward from USDA/Official data, based on current industry information which reflects the substitution from sorghum to corn for the livestock sector during this marketing year. The livestock sector, mainly poultry and hog production, consume corn primarily in the form of mixtures and feed concentrates. Private sources stated that the expectation of continued low corn prices compared to alternative feed stuffs should encourage more corn use in livestock feed rations. Additionally, feed consumption is expected to shift from sorghum to corn due to the lower-than-previously estimated domestic sorghum production.

Stocks

In comparison with the USDA/Official estimate, the Post/New ending stock estimate for MY 2015/16 is slightly lower at 3,309 MMT, due to higher than previously estimate domestic consumption.

Mexico, Corn Production, Supply and Demand for MY2013/14 to MY2015/16

Corn

2013/2014

2014/2015

2015/2016

Market Begin Year

Oct 2013

Oct 2014

Oct 2015

Mexico

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

7052

7052

7325

7325

7000

7000

Beginning Stocks

1061

1061

2694

2694

4209

4209

Production

22880

22880

25480

25480

23500

23500

MY Imports

10954

10954

11269

11269

11000

11300

TY Imports

10954

10954

11269

11269

11000

11300

TY Imp. from U.S.

10912

10912

11168

11168

0

11200

Total Supply

34895

34895

39443

39443

38709

39009

MY Exports

501

501

784

784

1000

1000

TY Exports

501

501

784

784

1000

1000

Feed and Residual

15200

15200

17700

17700

17500

17900

FSI Consumption

16500

16500

16750

16750

16800

16800

Total Consumption

31700

31700

34450

34450

34300

34700

Ending Stocks

2694

2694

4209

4209

3409

3309

Total Distribution

34895

34895

39443

39443

38709

39009

(1000 HA) ,(1000 MT)

Rice

Production

The Post/New total rice production estimate for MY 2015/16 (October to September) has been revised slightly downward from USDA/Official estimates to 195,000 MT (rough production) reflecting the most recent data from SAGARPA as of December 31, 2015. The decrease in rough rice production is equivalent to 134,000 MT of milled rice. Official sources indicated that rice output was mainly decreased due to lower-than-expected harvested area in the state of Tabasco. Reportedly, the adverse weather conditions caused by a cold front in December, 2015 damaged approximately 1,000 hectares of Tabasco's rice planted area for the 2015 spring/summer crop cycle.

Stocks

As a result of new domestic production information, the Post/New MY 2015/16 ending stocks estimate has been decreased to 113,000 MT from the USDA/Official estimate.

Mexico, Rice Production, Supply and Demand for MY2013/14 to MY2015/16

Rice, Milled

2013/2014

2014/2015

2015/2016

Market Begin Year

Oct 2013

Oct 2014

Oct 2015

Mexico

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

35

35

44

44

34

33

Beginning Stocks

189

189

151

151

152

152

Milled Production

131

131

179

179

135

134

Rough Production

191

191

261

261

197

195

Milling Rate (.9999)

6870

6870

6870

6870

6870

6870

MY Imports

693

693

698

698

700

700

TY Imports

658

658

700

700

700

700

TY Imp. from U.S.

535

535

0

619

0

630

Total Supply

1013

1013

1028

1028

987

986

MY Exports

2

2

2

2

3

3

TY Exports

2

2

2

2

5

5

Consumption and Residual

860

860

874

874

870

870

Ending Stocks

151

151

152

152

114

113

Total Distribution

1013

1013

1028

1028

987

986

(1000 HA) ,(1000 MT)