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Transcript of 1 THE MEXICAN POULTRY INDUSTRY AND THE NAFTA Cesar de Anda Cesar de Anda Cancún, México May 6 - 7,...
![Page 1: 1 THE MEXICAN POULTRY INDUSTRY AND THE NAFTA Cesar de Anda Cesar de Anda Cancún, México May 6 - 7, 2004 FIRST ANNUAL NORTH AMERICAN AGRIFOOD MARKET INTEGRATION.](https://reader035.fdocuments.in/reader035/viewer/2022062719/56649ef25503460f94c04dc2/html5/thumbnails/1.jpg)
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THE MEXICAN POULTRYTHE MEXICAN POULTRY
INDUSTRY AND THE NAFTAINDUSTRY AND THE NAFTA
Cesar de AndaCesar de AndaCancún, MéxicoCancún, MéxicoMay 6 - 7, 2004May 6 - 7, 2004
FIRST ANNUAL NORTH AMERICAN AGRIFOODFIRST ANNUAL NORTH AMERICAN AGRIFOOD
MARKET INTEGRATION WORKSHOPMARKET INTEGRATION WORKSHOP
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Performance of Poultry Industry
1. Situation before NAFTA
2. Transition period
3. Free Trade
4. Conclusions
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The relationship before NAFTA
• Commercial exchange with not clear rules
• Restrictions determined by the government
• Continues changes
• United States exported poultry products to the mexican market
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Before NAFTA• Differences between Mexican and US
Industries (1990):
– Scale of Production:• Poultry industry 7.6 times bigger in US than Mexico• Egg 3.6 times bigger in US than Mexico• Turkey 217.3 times bigger in US than Mexico
– Pattern of consumption has an impact on the prices of products
– Access to raw materials had a direct impact on costs
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Performance of Poultry Industry
1. Situation before NAFTA
2. Transition period
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• Clear rules
• Obligations for both countries
• Trade and more trade
• Dispute mechanism
What means NAFTA ?
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1.38 1.
51
1.48
1.49 1.
59
1.78 1.
94
2.07
2.16
1.0
1.2
1.4
1.6
1.8
2.0
2.2
2.4
Mil
lon
es d
e T
onel
adas
1994
1995
1996
1997
1998
1999
2000
2001
2002
CHICKEN MEAT PRODUCTION
Transition periodM
illi
on T
ons
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1.46
1.45
1.47 1.59
1.69
1.83
1.94 2.
01
2.04
1.0
1.2
1.4
1.6
1.8
2.0
2.2M
illo
nes
de T
onel
adas
1994
1995
1996
1997
1998
1999
2000
2001
2002
SHELL EGG PRODUCTION
Transition periodM
illi
on T
ons
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9
7,00
0
9,60
0 11,2
00
11,6
00
11,8
40
12,0
80
12,4
40
12,8
16
13,1
63
6,000
8,000
10,000
12,000
14,000
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
TURKEY MEAT PRODUCTION
TONS
Transition period
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Transition periodEVOLUTION OF CORN QUOTAS ( QUOTA NAFTA VS. IMPORTS )
3,26
3,23
8
3,07
4,68
4
3,16
6,92
4
2,98
5,13
0
2,89
8,18
5
2,81
3,77
2
2,73
1,81
7
2,65
2,25
0
2,57
5,00
0
2,50
0,00
0
5,909,037
5,033,938
5,356,501
6,000,0006,040,300
5,911,376
2,103,085 2,718,508
2,439,7375,100,000
0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
7,000,000
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003
YEAR
TO
NS
QUOTA NAFTA IMPORTS
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• Considering all those factors, Mexico is:
– The fourth producer of chicken meat worldwide
– The sixth producer of shell egg worldwide
Transition period
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• With the NAFTA the US industry consolidated its position like main supplying of poultry products to the Mexican market:
– 99 % of the imports of poultry meat products are from USA
– 98 % of the egg products are from USA
– 80 % of the egg for hatching and live chickens are from USA
Transition period
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• Final imports of chicken meat(thousand tons)
73.8
115.
5
141.
6
137.
9
123.
3
50
70
90
110
130
150
1996
2000
2001
2002
2003
• Evolution of the AYG:– 1996 to 2001 was 14%– 1996 to 2002 was 11%– 2001 to 2002 was - 2.7%– 2002 to 2003 was - 10.6%
• In average, from 1996 to the year 2002, imports of chicken meat represent 6% of national production
• 100% of the imports are for the border zone
Imports
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• Final imports of fresh egg(tons)
9,36
3
9,95
1
10,2
45
11,3
52
9,40
3
5,000
6,000
7,000
8,000
9,000
10,000
11,000
12,000
1996
2000
2001
2002
2003
• Evolution of theAYG:– 1996 to 2001 was 1.8%– 1996 to 2002 was 3.3%– 2001 to 2002 was10.8%– 2002 to 2003 was - 17.2%
• 90% of imports belong to fertile egg
• In 2003 only 17 tons of fresh egg were imported
Imports
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• Final imports of turkey meat(thousand tons)
61
94
98
79
113
50
60
70
80
90
100
110
1996
2000
2001
2002
2003
• Evolution of AYG:– 1996 to 2001 was 10%– 1996 to 2002 was 4.3%– 2001 to 2002 was -
20.8%– 2002 to 2003 was 43.3%
• There has been an increase on imports of pieces by the inlay industry and imports of turkey legs by roasteries.
Imports
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Performance of Poultry Industry
1. Situation before NAFTA
2. Transition period
3. Free trade
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• Access to raw materials – Mexico is not self sufficient in grains
40% comes from local market 60% comes imports
– Poultry market is open to free trade and yellow corn will be liberalized in 4 years This generates a real negative protection
• Technology on the Industry– In the US, 90% of the plants have further processes:
nuggets, ready to cook meals, etc.– In Mexico just starting up
Free Trade Facts
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Industry Performance in 2003
• In 2003 poultry industry produced 4.24 million tons – 1.9 million tons of table eggs– 2.3 million tons of chicken meat– 13.7 thousand tons of turkey meat
• Total value of production was almost $4.5 billion dollars
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A friendly relationship has always existed
It has strengthened during the last years
In 1999 UNA proposed to create a mechanism to talk officially with their counterparts
the NAFTA Egg & Poultry Partnership (NEPP) was borned in October 2000
RELATIONSHIP WITH THE US INDUSTRY
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Objectives of NEPP:– Be a mechanism to discuss and analize problems of the
industries
– Create a forum for mutual understanding and cooperation
– Create task groups to discuss, analize and solve issues on: Consumption Free trade barriers Sanitary policies Trade disputes
Free Trade
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Safeguard on chicken quarters:– Meetings to analyze impact since 2001
– Common solution UNA and USAPEEC: mechanism to protect mexican industry on certain
products
– Intense lobbying through 2001 and 2002 with: Federal Government Mexican representatives abroad US Authorities Industries
Free Trade
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Performance of Poultry Industry
• Situation before NAFTA
• Transition period
• Free trade
• Conclusions
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• The transition period and the rules of the NAFTA have evidenced that the markets of United States and Mexico are complementary
– United States consumes Breast and wings
– Mexico consumes Leg quarters
– Mexico needs of the agricultural inputs and egg for hatching and live birds of breeding of United States
– Mexico offers to United States, workforce cheap, beneficent weather for the production
Conclusions
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• In both industries, USAPEEC and UNA, has the vision of integrating a poultry market of North America (Mexico, United States and Canada), this will allow :
– To be more competitive in front of the Brazilian industry
– To supplement the export areas for the attention of common markets
– To have poultry production in the three countries
– To maintain the growth of the industry
Conclusions
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THANKSTHANKS