Ethanol Blog
Cheryl Anderson DTN Staff Reporter

Tuesday 11/19/13

Mexican Demand for DDGS Due to 20 Years of NAFTA

The 20th anniversary of the North American Free Trade Agreement will be Jan. 1, 2014.

The landmark trade agreement served as an example for many future trade deals. One of its results was Mexico's growth to be one of the largest importers of U.S.-produced dried distillers grains with solubles, according to an article by the U.S. Grains Council (http://bit.ly/…).

According to the statistics from U.S. Department of Agriculture's Foreign Agricultural Service, Mexico is now the second largest importer of U.S. DDGS, topped only by China. Mexico is followed by Canada, Japan and Vietnam in the third, fourth and fifth spots.

In 1994, Mexico purchased a total of 46,830 tons of U.S. DDGS valued about approximately $6.6 million. By 2012, Mexico had purchased almost 1.5 million tons of DDGS valued at almost $419 million. From January to September 2013 alone, Mexico has imported more than 903,000 million tons of DDG valued at about $282 million.

NAFTA was just the beginning for future U.S. trade with Mexico. Mexico has steady expanded in livestock and poultry production, which drove demand growth in feed grains.

USGC chairman Julius Schaaf commented, "NAFTA was certainly a difficult trade agreement to negotiate and pass, but as tariffs and duties phased out on schedule, with all remaining restrictions being eliminated in 2008, agriculture trade grew and blossomed.

"Since NAFTA came into effect, we've seen nearly a 200% growth in corn sales, sorghum, barley and related co-products, including corn gluten and DDGS to Mexico," Schaaf said.

Cheryl Anderson can be reached at Cheryl.anderson@telventdtn.com

(ES/)

Posted at 12:09PM CST 11/19/13 by Cheryl Anderson
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