Spud sales to Mexico could more than triple under new rule - The Packer

Spud sales to Mexico could more than triple under new rule

03/27/2014 01:34:00 PM
Andy Nelson

potatoesThe opening of all of Mexico to U.S. potatoes could more than triple fresh sales to the country.

Before the Mexican government published a rule in mid-March that should open the door for U.S. potato imports by June, U.S. exports were limited to a 16-mile zone south of the U.S./Mexico border.

The value of annual fresh potato exports from the U.S. to Mexico could jump from $30 million to $100 million under the new agreement, said Mark Szymanski, public relations director for the Washington, D.C.-based National Potato Council.

While the Denver-based U.S. Potato Board will work with U.S. shippers on marketing plans for tapping the Mexican market, the council will focus on helping the U.S. Department of Agriculture with shipping and labeling requirements and making sure they’re implemented correctly, Szymanski said.

John Toaspern, the potato board’s vice president of international marketing, said the first likely step will be a meeting between U.S. shippers and Mexican buyers and other industry members that he likened to a “speed dating” event.

“Initially, we need to focus on creating links, and on making sure everyone’s on the same page as far as what the new regulations and requirements are,” he said.

A meeting is tentatively set for May 6 in Mexico City.

After the initial meet-and-greet, Toaspern said the board will turn to targeting Mexican retailers and consumers, with a focus on recognizing the differences between Mexican-grown white potatoes and U.S. russets, red and other varieties.

“The russet looks different, and cooks different, but it doesn’t mean it can’t be used in Mexican cuisine,” he said.

Russets and other U.S. spuds have sold well in the 16-mile border zone, Toaspern said, and he’s confident they will be attractive in other parts of Mexico.

Aside from different varieties, U.S. shippers and marketers also must deal with a difference in packaging preferences, Toaspern said.

“One aspect that may be a little tricky is they are used to buying in bulk, and we prefer to sell packed.”

Turning Mexican retailers into fans of 5- and 10-pounders could take some work, Toaspern said.

Dick Okray, president of Plover, Wis.-based Okray Family Farms, has a different packaging-related concern.

U.S. shippers have been allowed to ship 50-pound boxes into the 16-mile zone. But Okray has heard that under the new rule, boxes larger than 20 pounds may not be allowed, and he’s wondering if that also applies to the 16-mile zone.

“As of yet, there are still some questions USDA needs to address,” Okray said March 27. “There’s still a little mystery surrounding the entire deal.”

That said, Okray applauded the council and board’s efforts to persuade Mexico to open its markets — an effort he said has been going on for 20 years.

“Any time we can get a trading partner to accept U.S. products, it’s a big win for their consumers and our growers,” he said.

It won’t just be Colorado, which traditionally has exported a larger percentage of potatoes to Mexico than other U.S. states, that will benefit from the deal, Szymanski said. The door is also open for Idaho russets, Red River Valley reds and other U.S. potatoes.

Toaspern agreed.

“Obviously Colorado, New Mexico and Texas are well-positioned geographically, but I think there’s an opportunity for all U.S. shippers,” he said. Washington and Idaho have already made inroads into Mexico, and with the opening of the entire country, Toaspern said shippers in Wisconsin and the Red River Valley can make better use of their access to the “I-35 corridor” connecting the Midwest to Mexico.

At least initially, it’s unlikely that Wisconsin growers will ship many more potatoes to Mexico, Okray said. Colorado, Texas and other states are more likely to ship spuds south of the border.

“At this point, most growers are approaching this with a bit of caution,” he said. “This year we’ll grow more for known markets.”

That doesn’t mean Mexico can’t be a good market for Wisconsin in the future, though, he said. As early as this summer, Okray said he might contact potential buyers in Mexico.

Concerning Mexican shipments to the U.S., Szymanski said it remains to be seen how big that market will be.

He did say that the smaller white potatoes native to Mexico will be a draw for Mexican natives living in the U.S. who can’t find similar spuds here.



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