MEXICO CITY, MEXICO — Thanks to favorable weather conditions and water supplies, Mexico is expected to produce more wheat in 2019-20 than originally estimated but totals remain unchanged for 2020-21.
Wheat production for 2019-20 is now estimated at 3.27 million tonnes, according to a report from the Foreign Agricultural Service of the US Department of Agriculture (USDA). For the 2020-21 harvest, production totals remain unchanged at 3.05 million tonnes.
Wheat consumption for 2020-21 is revised downward to 7.2 million tonnes. Coronavirus (COVID-19) pandemic restrictions contributed to a 30% decline in sales at traditional bakeries. An increase of 15% in shelf stable products has not made up for the loss of sales to restaurants, hotels and institutions, the USDA said.
“On the financial front, the industry reports that flour mills are having difficulty recovering losses from past-due clients and face ‘brutal’ competition to win the few clients still able to pay,” the USDA said. “Mills have less purchasing power due to the depreciation of the peso, higher costs for financing, and an increase in costs from establishing sanitary and hygiene measures in their facilities.”
Corn production estimates for 2020-21 are unchanged at 28 million tonnes. Estimates for 2018-19 and 2019-20 were revised upward to 27.6 million tonnes and 26.5 million tonnes, respectively.
Despite the upward adjustment in 2019-20, production is still 1.1 million tonnes lower than the previous year.