Mexico accounted for about 28% of U.S. total apple exports in 2017, the biggest share by far of any country.
However, a new report from the U.S. Department of Agriculture says importers in Mexico could be a little more cautious about apple imports in 2018-19.
“New/Post estimates for apple imports for marketing year 2018-19 are forecast to be lower compared to marketing year 2017-18 imports due to the depreciation of the peso against the dollar and international fruit prices,” the report said.
In the USDA Foreign Agricultural Service report on the outlook for deciduous fruits in Mexico, the USDA said that the U.S. remains the major supplier of deciduous fruits to Mexico. In fact, in 2016-17, the U.S. accounted for 98% of all Mexican apple imports, with only light volume from Chile and Canada competing in the market.
“Due to the depreciation of the peso against the dollar and the uncertainties this creates in the market, Mexican traders are being more cautious in importing fruit,” the report said. “Additionally, apple imports from the United States are expected to be lower due to the 20% retaliatory import duty imposed in June 2018 in response to U.S. aluminum and steel tariffs.
For Mexican traders, the report said the tariff is creating a cash flow problem. Since the duty must be paid in full before the sale, the tariff could stop some importers from purchasing apples.
More than 65% of apples are imported into Mexico during the months of January through July, and the report said traders expect demand will continue in this period as end consumers are used to having apples year round.
Washington-origin apples account for 85% of U.S. exports to Mexico, with the state of California supplying the remainder.
The USDA report said that four varieties continue to dominate the Mexican market, and account for 97% of the imported volume to date:
- 38% red delicious;
- 33% gala;
- 18% golden delicious;
- 8% granny smith; and
- 1% fuji.
The report said the decline in U.S. production of red delicious has allowed for greater imports of gala and other varieties. Gala variety imports increased from a 26% in 2017 to a 33% in 2018 due to a growth in production, according to the report.
Mexican apple output
The USDA report said Mexican apple planted area for marketing year 2018-19 is forecast to decrease marginally from 2017-18, as gains in some states are offset by decreases in others.
According to the report, apple area harvested is forecast to decrease compared with 2017-18 due to
frost in the states of Coahuila and Durango.
Area planted for golden delicious apple variety has been slowly increasing in Mexico, now accounting for 46% of apple area, compared with 31% for red delicious.
The report said the state of Chihuahua accounts for almost 50% of total area planted, of which 61% is planted with the golden delicious variety, and 32% to red delicious.
The state of Durango accounts for 14%, Puebla 14%, and Coahuila 10% of total area planted.
The report said growers believe Mexico’s planted area is not expected to expand much due to higher costs of production, limited credit availability, water scarcity, and limited market expansion.
Mexican apple production for 2018-19 is forecast lower about 660,000 metric tons, down from 714,000 metric tons in 2017-18.