2. USDA Update on Mexico’s Orange Juice Market

Total production of frozen concentrated orange juice (FCOJ) in Mexico during the 2016/17 and 2017/18 seasons was good. The industry there took advantage of greater international demand and particularly the decrease in US juice production. FCOJ production in Mexico for 2018/19 is forecast to increase due to the expected ample supply of oranges and attractive international prices. Florida is unable to cover domestic demand and orange producers in Mexico say there is strong uptake from local processors as a result. The USDA forecasts 2018/19 orange juice production in Mexico at 210 000 tonnes based on information from industry sources. Based on expectations of higher exports to the US and orange grower reports of strong processor demand, orange utilisation by processors in 2018/19 is forecast at 2.1 million tonnes, compared with 1.9 million tonnes in 2017/18 and 2.1 million tonnes in 2016/17.

Consumption

Industry sources suggest that domestic orange juice consumption is relatively stable at 7500-8000 tonnes per year. Mexican consumers generally prefer fresh squeezed juice to commercially processed orange juice. However, the industry is observing the increase of orange juice-based drinks. Industry reports that stocks are approximately 2000 tonnes, as a certain amount is needed for blending during the production process.

Trade

Exports of orange juice for 2018/19 are forecast at 203 000 tonnes, based on early industry reports. Estimates for 2016/17 and 2017/18 are revised upward from previous estimates, due to stronger international demand brought about by the shortage of FCOJ in the US. The US is the primary market for Mexican orange juice, but exports to Europe continue.

Mexico imports a small amount of orange juice for the hotel, restaurant, and institutional sector. Mexico will import approximately 1000 tonnes of orange juice in 2018/19, the same level as the previous year. Most imports arrive from the US at zero duty.

MEXICO – ORANGE JUICE (65 brix equivalent) Tonnes

Season

2016/17

2017/18

2018/19

Beginning stocks

1700

1200

2000

Production

210000

195000

210000

Exports

203500

187200

203000

Dom. consumption

8000

8000

8000

Ending stocks

1200

2000

2000

Total distribution

212700

197200

213000

Source: USDA