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Selling to Mexico

Insights, challenges, and opportunities for the third-largest export market
Selling To Mexico

Mexico the supplier is well known; but how about Mexico the buyer? Many are surprised to learn that Mexico is the United States’ third largest agricultural export market, behind China and Canada. Perhaps more surprising are the produce suppliers still hesitant to take advantage ­of this opportunity—some are intimidated by the language barrier, others the well-publicized drug violence—but neither should keep companies from exploring sales to Mexico.

A Major Market
Sharing a 2,000-mile border that has over 45 border crossings, the United States is Mexico’s top trading partner for consumer-oriented agricultural imports. The numbers are too big to ignore: the total bilateral trade value of agricultural and related products between the United States and Mexico was $37.3 billion in 2013, according to a U.S. Department of Agriculture (USDA) Foreign Agricultural Service report.

Mexico is also the number-two export market for U.S. fresh fruit and vegetables, trailing Canada. Through the North American Free Trade Agreement (NAFTA), which has been in place for 20 years, imports and exports are near parity. Exports to Mexico were $18.9 billion, down slightly from a record $19.7 billion in 2012, while Mexican imports rose from $17.1 billion in 2012 to $18.4 billion in 2013.

Among the key U.S. exports are fresh fruit ($626 million), processed fruit ($112 million), and vegetables ($255 million). Apples represented well over half of fresh fruit sales at $344 million, and grapes and potatoes were also top performers, valued at $134 and $141 million respectively.

Growth & Maturity
The Mexico market is many things to many people, but everyone agrees it is expanding. “It is definitely a growing, maturing market,” comments George Papangellin, sales manager at Gerawan Farming, headquartered in Sanger, CA, an importer/exporter that grows and ships grapes and stone fruit.

“People are becoming more technically savvy on both sides of the border, learning how to understand each other and how to work deals,” Papangellin explains. “It can only get better, regardless of any geopolitical issues.” Top of mind for many who do business with Mexico and other countries is quality. “If you can demonstrate quality, there is going to be a market for it in Mexico.”

Bob Cordova, president of Lompoc, CA’s EpicVeg puts it this way: “It’s untapped potential,” he remarks. “There’s a tremendous amount of opportunity in Mexico.” Assessing the Opportunity