Highlights

Corn production is projected to be higher than previous estimates, as farmers shifted production from sorghum to corn due to pest concerns. Favorable weather conditions this growing season have been beneficial to both corn and rice production.

WHEAT

Production

The Post/New marketing year (MY) 2016/17 wheat harvested area and production estimates have been revised slightly downward from USDA/Official estimate, based on updated data from Mexico’s Secretariat of Agriculture, Livestock, Rural Development, Fisheries and Foodstuffs (SAGARPA) as of October 31, 2016, which includes the preliminary final data for the 2016/17 fall/winter crop cycle.

Wheat

Market Begin Year

Mexico

2014/2015

2015/2016

2016/2017

Jul 2014

Jul 2015

Jul 2016

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

707

705

825

825

720

712

Beginning Stocks

319

319

528

528

516

516

Production

3687

3687

3751

3751

3900

3863

MY Imports

4476

4476

4805

4805

4600

4600

TY Imports

4476

4476

4805

4805

4600

4600

TY Imp. from U.S.

3065

3065

2753

2753

0

3100

Total Supply

8482

8482

9084

9084

9016

8979

MY Exports

1104

1104

1568

1568

1500

1500

TY Exports

1104

1104

1568

1568

1500

1500

Feed and Residual

400

400

400

400

450

450

FSI Consumption

6450

6450

6600

6600

6670

6670

Total Consumption

6850

6850

7000

7000

7120

7120

Ending Stocks

528

528

516

516

396

359

Total Distribution

8482

8482

9084

9084

9016

8979

Stocks

The Post/New ending stocks estimate for MY2016/17 (359,000 MT) is lower than the USDA Official estimate as a result of lower-than-expected production.


Production

CORN

The projected corn production for MY 2016/17 has been raised 6.1 percent from USDA/Official data to 26.0 million metric tons (MMT), based on most recent data issued by SAGARPA. Benign weather conditions during the growing stage favorably impacted yields and reduced the total area damaged for the 2016 spring/summer crop cycle, in comparison to the previous spring/summer crop cycle. Based on preliminary official information, as a result of the relatively favorable weather conditions across much of Mexico’s rain-fed corn production areas, the total area damaged for the 2016 spring/summer corn crop cycle is estimated at less than 90,000 hectares, compared to 493,000 hectares registered during the crop cycle last year. Another factor influencing the production estimate increase was higher-than-expected planted area. In Guanajuato, for example, 88,000 more hectares of corn were planted instead of sorghum (18 percent higher than the same crop cycle of 2016), due to the prevalence of the of the sugarcane aphid (SCA) pest infestation on the sorghum crop. Also, the new corn production estimate includes the planting intentions of the current 2016/17 fall/winter crop cycle, which is estimated to reach production of 8.3 MMT.The Post/New production and harvested area estimates for MY 2015/16 have been revised upward from USDA/Official figures. These changes reflect the preliminary final data from the SAGARPA.

Consumption

For MY2016/17 the Post/New consumption of feed and residual estimate has been revised upward from USDA/Official figures, based on information from private and official sources. These sources consider that feed consumption likely will shift from sorghum to corn, due to lower than previously estimated domestic sorghum production.

Trade

In comparison with the USDA/Official estimate, the Post/New import estimate for MY 2016/17 has been revised downward to 13.4 MT, based on higher domestic production than previously estimated. Despite this adjustment, the estimated import level is substantially higher than the historical import average of the few last years, due to continued growth in demand for feed by the poultry and livestock sectors. Similarly, export estimate for the MY 2016/17 has been revised upward as a result of higher than previously estimated domestic production.

Stocks

Post’s MY2015/16 estimated ending stocks were revised upward from the USDA/Official estimate, due to higher than previously estimated domestic production. The ending stocks estimate was reflected in the carry over for the MY 2016/17 which was also adjusted upward from USDA/Official estimate.

Mexico Corn Production, Supply and Demand for MY2014/15 to MY2016/17

Corn

Market Begin Year

Mexico

2014/2015

2015/2016

2016/2017

Oct 2014

Oct 2015

Oct 2016

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

7325

7325

7205

7207

7100

7500

Beginning Stocks

2603

2603

4090

4118

5242

5599

Production

25480

25480

25800

25971

24500

26000

MY Imports

11341

11269

14011

14010

13800

13400

TY Imports

11341

11269

14011

14010

13800

13400

TY Imp. from U.S.

11240

11168

13603

13645

0

13200

Total Supply

39424

39352

43901

44099

43542

44999

MY Exports

784

784

1559

1600

800

1000

TY Exports

784

784

1559

1600

800

1000

Feed and Residual

17800

17700

20300

20100

20600

21200

FSI Consumption

16750

16750

16800

16800

16900

16900

Total Consumption

34550

34450

37100

36900

37500

38100

Ending Stocks

4090

4118

5242

5599

5242

5899

Total Distribution

39424

39352

43901

44099

43542

44999

SORGHUM

Production

For MY2016/17 the Post/New sorghum production estimate has been adjusted downward due to lower than previously estimated planted area, which reflects updated SAGARPA data. The main reason for this adjustment has been the prevalence of the sugarcane aphid (SCA) pest in the main producing states such as Guanajuato, Michoacan, and Jalisco. Official sources pointed out that the campaigns implemented to control and mitigate the SCA infestation and favorable weather conditions have allowed growers to reverse the yield reduction caused by the pest. However, despite the phytosanitary campaigns implemented, many growers decided to plant corn instead of sorghum in the 2016 spring/summer crop cycle, as in the case of Guanajuato mentioned above. It is estimated that sorghum production will reach 2.1 MMT in this crop cycle, which is 21 percent lower than the same crop cycle of 2015.

The Post/New total sorghum production and area harvested estimates for MY2015/16 have been revised slightly upward from USDA/Official estimates reflecting the preliminary final data from SAGARPA.

Consumption

The Post/New total consumption estimate for MY2016/17 has been revised downward from USDA/Official figures. Feed consumption is expected to shift somewhat from sorghum to corn, due to lower than previously estimated domestic sorghum production. Private sources noted that lower corn prices continue stimulating Mexico’s import demand for yellow corn in the animal feed sector, and the United States continues to be the main supplier to cover that demand. In addition, lower corn prices have also stimulated a surge in the demand for domestic corn production, thus making sorghum less attractive.

Trade

Post’s total sorghum imports estimate for MY 2016/17 has been revised upward from USDA/Official data to 1.0 MMT. The revised data reflects the impact of lower than previously estimated domestic production. However, it should be noted that private sources do not expect a substantially stronger sorghum import demand from feed millers and poultry and hog producers as it is estimated that sorghum prices are high relative to corn. These sources expect relatively lower sorghum feed use and further declines in corn prices, which should encourage expansion in the poultry and hog sectors. The poultry industry continues to be the major consumer of corn and sorghum in Mexico, using the crop primarily in the form of mixtures and feed concentrates.

Stocks

As a result of higher-than-previously estimated domestic production and imports, Post’s MY2015/16 estimated ending stocks were revised upward. The ending stocks estimate was reflected in the carry over for the MY 2016/17 which was also adjusted upward from USDA/Official estimate.

RICE

Production

For MY 2016/17 the Post/New total production estimate has been revised upward to 277,000MT (rough production) due to more complete data from SAGARPA. The increase in rough production is equivalent to 190,000 MT of milled rice. According to official sources, the expectation is that rice production will increase from the 2016 spring/summer crop cycle by approximately 25 percent to 178,000 MT (rough production) compared to the same crop cycle a year earlier. Favorable weather conditions in rain-fed areas, mainly in Campeche and Tabasco, and consequently improved yields, have contributed to increase the production estimate. In addition, in Campeche approximately 33 percent more acreage was planted than the same crop cycle a year earlier.

Reflecting preliminary final figures from SAGARPA, the Post’s total rice production and harvested area estimates for MY 2015/16 have been revised slightly upward from the USDA/Official estimate to 227,000 MT (rough production). This volume of rough rice production is equivalent to 156,000 MT of milled rice.

Stocks

The MY 2015/16 Post/New ending stock estimate was revised upward to 127,000 MT from the USDA/Official estimate due to higher than previously estimated domestic production. This is reflected in the upward adjustment for MY 2016/17 carryover as well. For MY 2016/17 the Post/New stock forecast is 175,000 MT.

Rice Milled

2014/2015

2015/2016

2016/2017

Oct 2014

Oct 2015

Oct 2016

USDA Official

New Post

USDA Official

New Post

USDA Official

New Post

Area Harvested

44

44

39

40

42

41

Beginning Stocks

159

159

165

165

120

127

Milled Production

179

179

149

156

173

190

Rough Production

261

261

217

227

252

277

Milling Rate (.9999)

6870

6870

6870

6870

6870

6870

MY Imports

709

709

693

693

750

750

TY Imports

719

719

700

700

750

750

TY Imp. from U.S.

624

624

0

535

0

600

Total Supply

1047

1047

1007

1014

1043

1067

MY Exports

2

2

2

2

2

2

TY Exports

2

2

2

2

2

2

Consumption and Residual

880

880

885

885

890

890

Ending Stocks

165

165

120

127

151

175

Total Distribution

1047

1047

1007

1014

1043

1067