PUERTO VALLARTA, Mexico – Canadian canola exports to Mexico should approach record levels in the 2003-04 crop year.
Mexican officials expect crushers will buy one million tonnes of Canadian product for their marketing year ending September 2004, matching a record set in 2000.
Sales for the first four months have reached 500,000 tonnes, up 50 percent over the same period last year.
And the news only gets better.
While Japanese buyers have expressed displeasure about Canada’s crop quality, the only concern the Mexicans have is the lack of supply.
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“(Canadian farmers) are really producing an excellent canola. We hope that the quality of oil and protein will improve year after year,” said Amadeo Ibarra Hallal, director general of ANIAME, a Mexican agricultural suppliers association.
He encouraged Canadian farmers to increase production to eight or nine million tonnes from the 6.7 million tonnes harvested in 2003, which would spur further sales.
“Mexico would probably increase its imports around 50 percent more,” Hallal told reporters attending the Canola Council of Canada’s 37th annual convention.
That would meet one of the council’s stated market demand objectives, to expand sales to Mexico by 500,000 tonnes by 2007. Some exporters think shipping 1.6 million tonnes to Mexico is an attainable goal.
The appetite for canola is driven by a six percent annual increase in Mexican consumption of pork, beef and poultry. Livestock producers need canola meal to feed their animals.
Mexican producers began growing canola three years ago and have had success with yields and quality, but they pose no serious threat to Canadian producers. Hallal expects that three years from now 125,000 acres will be seeded to the crop.
With 55 oil refiners, the country will remain a big net importer of canola and other oilseeds for the foreseeable future. To put that in perspective, Canada has nine crushing plants.
Mexico gets 89 percent of its edible oils and fats, 92 percent of its oilseeds and 95 percent of its meals from foreign suppliers. In 2002, the country brought in 5.4 million tonnes of seeds, 1.1 million tonnes of oil and 3.9 million tonnes of meal.
One potential concern for canola exporters is that Mexico has ratified the Cartagena Protocol on Biosafety, an international agreement to protect biological diversity from the risks of genetically modified organisms.
But the country is also in the process of passing its own biodiversity legislation seen as favourable to the canola industry.
“The first drafts of it were more European-like than American or Canadian-like,” said Dave Hickling, vice-president of canola use with the Canola Council of Canada.
The latest version of the bill, which is subject to a vote in the coming months, has come full circle, said Hallal.