Mexican livestock producers have closed a deal with Brazilian yellow corn producers through which record amounts of the crop will be imported from the South American country.
An official with the federal Agriculture Secretariat (Sagarpa) who visited Brazil last week as part of a delegation of livestock producers said several Mexican firms were able to negotiate directly with Brazilian suppliers, bypassing firms such as Louis Dreyfus Company and Cargill,which usually agree on terms on behalf of both parties.
“If prices become even more attractive, [the Mexican firms] could start importing even more,” said Alejandro Vázquez Salido, adding that in some regions of Brazil yellow corn can be purchased at lower prices than those found in the United States, the main source of the yellow corn used to feed livestock in Mexico.
Higher prices and longer shipping times have limited imports from Brazil for years. Before the visit by industry representatives, the prize per tonne of Brazilian corn was some US $15 higher than United States-grown corn.
In the new deal, which will consist of two 30,000-tonne shipments to be delivered in August, the prices were only between $3 and 5 higher.
These first shipments are part of an accord signed with Brazilian producers to import a total of 300,000 tonnes at the same advantageous prices.
The amount is minuscule compared to the 12.75 million tonnes of yellow corn Mexico imported from its northern neighbor last year, remarked Vázquez, but it also is five times the amount imported from Brazil during the same period, “a record volume.”
A rise in U.S. protectionist sentiments and threats against Mexico’s trade with the U.S. have pushed Mexican authorities to explore trade opportunities farther afield.
Source: El Financiero (sp)