April 5, 2021
USSEC: US soy sector connects with counterparts from Mexico in March event
On March 11-12, the US Soybean Export Council (USSEC), American Soybean Association, United Soybean Board, Iowa Soybean Association (ISA) and the Iowa Economic Development Authority hosted the Iowa Virtual Trade Mission to Mexico to continue connecting with all members of the soy supply chain.
"The US and Mexico have a long partnership," said USSEC CEO Jim Sutter, as he welcomed more than 50 participants, including attendees from Mexico's crushing industry. "Mexico's crushing industry is a key partner to the US soy family. Working together on quality and market access issues is mutually beneficial."
"Iowa farmers are going to be ready to produce a crop, I'll promise you that," said Jeff Jorgenson, ISA's president. Grower leaders Robb Ewoldt, Randy Miller and Jeff Frank provided spring updates from their farms, including planting intentions and a quick rundown on their operations' sustainability methods.
"It's critical that we continue to connect with our customers," said Carlos Salinas, who serves as USSEC's regional director for the Americas. "This is a market that has not only shown real growth but has demonstrated a preference for US soy products. In 2020, the US had an 85% market share in Mexico's imports of whole soybeans, nearly 100% for soybean meal, and over 92% for soybean oil."
In the current marketing year (2020/21), Mexico's share as a destination for US exports has been 5% for whole beans, 14% for soybean meal and 5% for soybean oil.
"While US soybean meal and oil exports to Mexico are down from the high-water marks of the 15/16 and 16/17 marketing years, that is more a function of Mexico expanding crush capacity and becoming a more dedicated importer of whole soybeans for domestic crush," Salinas explained.
The past decade, according to Mac Marshall, vice-president of market intelligence for USSEC and USB, has seen US soy exports to Mexico rise substantially.
"After China, Mexico has been the number two market for the US soybean complex – beans, meal, oil – year after year for the past decade in both value and volume terms," he said. "There were just two marketing years when it was second to the EU in volume and one marketing year where it was second in value. In fact, over the past decade – I'm comparing completed MY 19/20 vs MY 09/10 – both US whole bean and soybean meal exports have grown by nearly 50%.
"For the current marketing year (MY 20/21, data is through week ending March 18th), the US has exported a combined 3.84 million metric tonnes of whole soybeans and soybean meal (SBM) to Mexico. That's a record for this point in the marketing year, and 7% ahead of MY 18/19, when we had shipped a combined 3.59MMT to Mexico through this stage of the marketing year."
The market continues to show a tremendous opportunity for further growth, Marshall said. He added: "As consumers in this region improve their quality of life through factors such as better salaries and gender equity, they are demanding higher protein diets with a sustainable footprint. With these types of trade missions, we hope to create further demand and preference for US Soy by directly connecting producers and consumers."
"USSEC has always worked to build relationships between all parties in the soy value chain, and we've continued to think creatively this past year about how we can keep doing that," said Salinas. "This virtual trade mission is unique in how it created a direct connection between buyers and sellers. This was much more than a meeting – it truly allowed farmers in Iowa to speak directly to their consumers in Mexico and allowed our buyers in Mexico to talk to our farmers firsthand and learn more about how they grow a reliable supply of sustainable US soybeans. The trade mission helped all parties involved to better understand the others' sector."
Topics covered during the event included information on sustainability, quality and macroeconomics, and perspectives from Mexico's soy, crushing and feed/livestock industries.