Pork exports to Mexico racing toward new annual record

Mexico has long been a leading destination for U.S. hams and picnics, but strides made at retail, foodservice have expanded range of pork cuts entering market.


Source: U.S. Meat Export Federation (USMEF)

via National Hog Farmer - Jan 12, 2022


Coming off a tremendous, record year in 2020, U.S. pork exports faced a daunting task in 2021: how to match that performance despite slowing demand from the world's largest importer China.


Up to the plate stepped Mexico, which prior to the surge in exports to China had traditionally been the leading volume destination for U.S. pork. But demand had softened in recent years due to tariffs, heightened competition and COVID-related slowdowns in foodservice and processing activity. U.S. pork exports to Mexico peaked in 2017, topping 800,000 metric tons valued at more than $1.5 billion. At the time, this was not just a new record for U.S. pork to Mexico it was the largest volume any pork-exporting country had ever shipped to a single destination.


2018 began as a promising year for U.S. pork in Mexico, but hit a major mid-year obstacle when Mexican officials imposed a 20% duty on most imports of U.S. pork. The duties were in place for nearly a full year, finally being lifted in late May 2019. The pork import duties affected Mexico's demand for U.S. pork on several fronts and the direct impact on pricing incentivized Mexican buyers to seek alternative suppliers, including those from Canada and Europe.


Removal of the duties and subsequent ratification of the new U.S.-Mexico-Canada Agreement paved the way for a rebound in demand for U.S. pork, but this momentum was interrupted by the COVID pandemic. Mexico's tourism and hospitality sectors were hit especially hard, and its meat processors faced labor shortages and significant distribution challenges. These factors, along with surging demand from China, contributed to a down year in 2020 as U.S. exports to Mexico fell to the lowest level (688,000 mt) since 2014.


While the pandemic continued to impact Mexico's economy in 2021, social distancing restrictions were far less stringent and consumer demand for pork regained momentum especially at the retail level...