Last but not least is the location advantage. Thanks to Mexico’s proximity to the United States, American importers can quickly gain access to fresh-picked produce from south of the border. “We have a logistical advantage over the rest of the world,” observes Losolla. “Other countries can’t compete because they have to boat or fly in product.” Better yet, he notes, is some of the company’s Mexican farms are only a three-hour drive from the U.S. border.
Nagging NAFTA Concerns
While a deluge of fruits and vegetables continues to cross the border for the time being, some produce professionals worry North American Free Trade Agreement (NAFTA) renegotiations could throw a wrench into future trade. Created in 1994 to increase the flow of goods across North America, NAFTA eliminates most import tariffs and reduces nontariff trade barriers.
According to the Center for North American Studies, U.S. agricultural exports have skyrocketed from $46.2 billion in 1994 to $134.9 billion in 2016, a 192 percent increase. In the same time span, U.S. agricultural exports to Canada and Mexico mushroomed from $10 billion to $38 billion, a 288 percent increase.
If NAFTA talks fall apart and the United States pulls out of the deal, these numbers could potentially plummet. It’s difficult, however, to predict exactly how NAFTA renegotiations will impact produce trade between Mexico, the United States, and Canada. With new tariffs on other regions of the world, creating turmoil with Mexico does not seem like a favorable plan, but few are placing bets on which way it will all go.
“I’m not sure how it will affect business,” acknowledges Fawcett, echoing the thoughts and mixed feelings of many along the fresh produce supply chain. “It’s kind of like immigration—I don’t know what answer will be conducive to everybody. Some parts of NAFTA would benefit me, but it might hurt another commodity. It’s hard to tell what’s going to happen.”
Top Crops & Hot Exports
While Mexico is a top exporter for a string of fruits and vegetables, a few specific commodities continue to move with lightning speed…
It’s no secret that Mexico grows tons of avocados, primarily in the Pacific Coast state of Michoacán. Often referred to as ‘green gold’ by the nation’s growers, Mexican avocados account for nearly half the world’s production.
The Michoacán town of Tancítaro alone ships out more than $1 million worth of avocados every single day. This one town is solely responsible for 80 percent of all U.S. imported avocados. An unfortunate side effect of Tancítaro’s success is becoming a target for criminal cartels and threats of extortion. In response, the town formed its own armed vigilante group for protection, at an estimated cost of $1.2 million a year.