Mexico - Livestock and Products Annual Report 2008

Total pig meat production will increase slightly in 2009 - by 2.45 per cent - after a slight decline during 2008. Pork exports are forecast to continue growing in 2008 and in 2009 as exporters take advantage of a trade agreement with China. These are the predictions of Zaida San Juan and Daniel R. Williams in the latest USDA Foreign Agricultural Service GAIN Report. A link is provided to the full report.
calendar icon 1 October 2008
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Report Highlights

Due to higher prices for feed cattle, marginal economic performance, and increases in consumer prices, the rate of growth in red meat consumption in Mexico is expected to decelerate as many middle and lower income consumers are expected to substitute red meat for relatively cheaper poultry products. Though some government and private industry measures have been taken to moderate the increase in prices, pork and beef consumption forecasts are only slightly increased over the past two years. Live calf exports to the United States are expected to climb in 2009, but will remain below the 2007 export figure after falling in 2008. In contrast, the export of red meat is forecast to increase in the medium term.

Executive Summary

In 2009 total production is expected to increase slightly, due to domestic slaughter increasing slightly compared with previous years. Ending inventories are expected to reduce for both 2008 and 2007 estimates. No growth in 2009 hog imports are expected, however, Mexico’s imports of U.S. hogs are forecast to reach 225,000 head in 2008, a healthy increase from 2007. Pork production for 2009 is forecast to recuperate (2.45 percent) after decreasing very slightly in 2008 (0.7 percent). Growth in pork consumption is expected to slow in 2009 after increasing by five percent in 2008, as are 2009 imports after an expected climb by nearly 20 percent in 2008. Mexico’s pork exports are forecast to continue growing both in 2008 and in 2009 as exporters take advantage of opportunities with a trade agreement signed with China.

Note: Estimates for 2009 figures are the first such estimates, while Post’s 2008 forecast figures for cattle, beef, swine and pork have been revised from the previous report (GAIN report MX8014).

2009 pork production is not expected to grow at any rate, although lower prices and higher quality pork and pork products could help stimulate demand. In addition, the opportunity to access new markets, the new declaration of Mexican States of Mexico and Morelos as free of porcine fever, and the Mexico hog industry trend towards vertical integration and industry consolidation give opportunities for hog production and slaughter to increase slightly in 2009. It is also estimated that swine inventories will decrease because of a higher pork demand (including exports).

The 2008 pork production forecast was revised lower than the preview estimate, and now shows a one percent decline from the 2007 estimate. Although many producers have been affected by higher feed costs, hog numbers are expected to continue growing in 2008 and in 2009.

As a result of high input costs, pork meat prices have increased considerably in Mexico this year. July 2008 prices were nearly 95 percent higher than the same period of 2007. Prices in Mexico have increased an average of 32 percent for the first seven month of CY 2008.


Mexico’s pork consumption increase rate is expected to slow in 2009 after revised estimates show an increase of 5 percent in consumption in 2008. Although pork consumption may increase slightly, the consumer perception of pork meat and a greater tendency to eat less red meat for health purposes remains the binding constraint to greater consumption growth.

Due to a sufficient supply and attractive price, Mexico’s sausage companies continue to use imported U.S. pork variety meats. Although Mexican hog producers and government are pressuring sausage companies to buy domestic product, the offer of pork meat from federally inspected slaughter facilities in Mexico is limited.


In 2009 pork exports will increase considerably if Mexico finally gains access to the Chinese market. In July 2008, Mexico and China signed documents that will permit recognition of the inspection systems in both countries, and lead to increased export opportunities. In spite of the food crisis, it is also expected that 2008 exports of pork will have a greater level of growth than 2007 because of an improved sanitary conditions in Mexico where many states have now been declared free of classic porcine fever. The Mexican Government is pushing the international market to recognize this, which will permit more Mexican companies to export, primarily to Japan.

Growth in Mexican pork imports are expected to slow in 2009 after showing strong growth in 2008 due to increased domestic production in Mexico. However, Mexico will continue being a strong market for U.S. pork variety meats, lard, and greases. Due to a reduction in domestic supply, pork imports for 2008 are now forecast at 514,000 MT, which is nearly 22 percent higher than the 2007 revised data.

Post anticipates a 3.5 percent increase in U.S. hog exports to Mexico in 2009, at a slower pace than accelerated rates in 2008. U.S. hog exports to Mexico in 2008 are now estimated at 280,000 head, 58 percent more than imports for the same period in 2007.


The animal feed companies and animal producers are passing through a difficult period in 2008 due to the higher grain prices, a tendency which will continue for the rest of the year. An element that could help compensate for the increase in feed costs and also in prices of red meat is the money that SAGARPA has been authorized to use to provide a subsidy for the purchase of feed inputs. For each ton of domestic grain (white corn, yellow corn, sorghum and wheat) feeders of chicken, pork and beef purchase, they will then receive 200 pesos from the Government. The purpose of this measure is to support meat production at a reasonable cost in order to provide consumer sufficient supply without significant increases in prices.

Mexican pork producers continue to spend considerable time and energy appealing to both the Mexican and U.S. governments for aid and assistance. Several times they have asked Congress and Government to apply protectionist policies. The latest request was to impose the same rules as those that the U.S applies to Mexico and they have also successfully lobbied to reduce of the numbers of Mexican border crossings authorized to inspect meat products. For more information about imports and policy issues see GAIN report MX8014.

Further Reading

- You can view the full report by clicking here.

Other Reports in this Series

To view our complete list of 2008 Livestock and Products Annual Reports covering pigs from USDA FAS GAIN, please click here

October 2008
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