WASHINGTON, D.C., U.S. — Mexico’s market year 2016-17 oilseed production is forecast to increase to 505,000 tonnes based on favorable weather conditions and a slight increase in harvested area, the U.S. Department of Agriculture’s (USDA) Foreign Agricultural Service (FAS) said in an April 9 report. The Mexican government continues to try and stimulate domestic soybean production through various support programs geared toward growers. Domestic oilseed production represents only 8% of total domestic consumption. Due to proximity, U.S. oilseed suppliers should continue to remain price competitive. 

Soybeans continue to be the primary import that is crushed domestically. For market year 2016-17, soybean imports are forecast at 4 million tonnes. The U.S. should continue to be Mexico’s main soybean supplier.

Total soybean consumption is expected to increase approximately 2.4% to 4.4 million tonnes in market year 2016-17 because of increased feed demand, stronger processor demand, and population growth which is up 1.4%. 

Soybean meal production is forecast to increase 2.38% to 3.44 million tonnes for market year 2016-17, anticipating a higher crushing level, which is mainly the consequence of the expected stronger demand from the poultry and livestock sectors. Soybean meal capacity remains highly concentrated in the hands of few companies. 

Private analysts stated that due to the dynamism of the domestic soybean meal and vegetable oil markets, the leading crushers and vegetable oil refiners in Mexico have expanded their facility capacities. Moreover, these companies have the capability to easily switch over from one oilseed to another (for example, soybeans to rapeseed or vice versa). It is expected some of these companies in 2016 will continue to invest, seeking to expand capacity and modernize their facilities even more.