U.S. sorghum producers in Texas and Kansas are tapping into the logistical advantages of their closest international market - Mexico - during a direct sales mission organized by the U.S. Grains Council (USGC) and the United Sorghum Checkoff Program (USCP).
The mission includes representatives from three U.S. cooperatives in Texas and Kansas who will meet with representatives from across the beef, poultry and swine feeding industries to talk about their specific nutritional and logistical needs. The team also met with rail contacts in Mexico to provide perspective on logistics and pricing.
'As part of our ongoing outreach, USGC and USCP bring sorghum cooperatives to Mexico for direct meetings with end-users looking to purchase their grain,'said USGC Mexico Assistant Director Heidi Bringenberg. 'The Council actively shares information with these end-users on crop conditions, quality and production, but direct conversations with suppliers are equally important to building this market.'
'Meeting face-to-face to discuss the complex themes of credit, customs agents and logistics is the best way for these parties to gain confidence in one another. Now when the cooperatives have a good deal to offer, Mexican companies will be more likely to execute a purchase.'
A similar mission in 2016 resulted in 47,000 MT (1.85 million bushels) of sorghum directly contracted from Texas cooperatives. This year's mission includes both geographically advantageous Texas cooperatives and Kansas cooperatives with rail access to directly sell to Mexican companies.
Overall, Mexico is the second largest customer for U.S. sorghum behind China, purchasing about 23.9 million bushels (606,000 metric tons) in 2015/2016. The livestock industry in northern Mexico is a natural market for U.S. sorghum both for growers in Southern Texas, where trucks and trains move grain across the border daily, and for cooperatives in Kansas that have direct rail lines available to send shuttle trains to Mexico.
The duty-free provisions in the North American Free Trade Agreement (NAFTA) have led to these increasingly integrated logistics for the grain trade. Mexican end-users now prefer U.S. sorghum over local sorghum supplies for high-protein, quality feed, but the U.S. grain also must compete on price.
'The United States is the best option for sorghum imports by the Mexican livestock industry,' Bringenberg said. 'Sorghum continues to be an important animal feed ingredient in Mexico due to the reliable supply of high-quality sorghum with good nutritional feeding value.'
Learn more about USGC's work with sorghum here.