Thursday's release of a USDA attache report titled Mexico Grain and Feed Annual estimates that Mexico's wheat imports will increase by 5.7% to 5.5 million metric tons in 2018/19.
Consumption within the country is seen growing by 2% in 2018/19, faster than the rate of population growth, given new product development and income growth among consumers. Recent years have also seen a gradual change in trend away from the preference of corn tortillas towards wheat-based products, which is partially due to higher prices asked for corn tortillas.
This report follows Statistics Canada's January export data that shows Canada exporting 222,777 metric tons of wheat (excluding durum) to Mexico, the highest monthly volume shipped to this country since October 2011. While not shown, this volume represented 12.5% of total monthly exports, the highest percentage seen since February 2012. The USDA notes that quality and more specifically protein levels are a key requirement in Mexico, where imports from Russia and Ukraine have fallen by 32% and 22% respectively, in the January-through-November period of 2017 as compared to the year prior.
Canada's cumulative crop year exports total 602,327 mt, shown by the yellow bar on the attached chart, which is the fastest start in crop year exports in four years. Crop-year to-date, this represents 6.9% of total exports and is the highest share of total exports seen since the 2011/12 crop year when exports to Mexico represented 7.9% of total wheat exports, according to Statistics Canada data.
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