U.S. rice continues to hold a commanding import market share in Mexico, amounting to just over 90 percent.  The U.S. presence is frequently under threat, however, by phytosanitary actions taken by Mexican officials that affect imports of U.S. paddy, and by recent competition in the milled market by suppliers from Asia and Uruguay.

This week some rail shipments of U.S. paddy were halted at the border by Mexico's plant health inspectors because of claims of contamination by soil. Mexico has a zero tolerance for soil in bulk imports of paddy rice and several other commodities, and disruption has occurred in the past.  Quick action by U.S. Department of Agriculture officials in Mexico City, Washington, D.C. and at the border looks to be resolving the current situation but all parties are focused on a longer term mitigation to maintain regular, uninterrupted shipments to the number-one export market for U.S. rice.

The share of milled rice in Mexico's total imports has been rising in recent years and reached 16 percent in the first five months of this year.  The United States has historically held 96% of the market share for milled rice but it has steadily decreased since 2010 as imports from Uruguay, and more recently Pakistan, have soared.  Recently, the Mexican government reported imports of 50 metric tons (MT) of Vietnamese rice in May 2013, valued at $25,520.  This is a small amount but continues a disturbing trend.

This increase in Asian imports is due largely to the price differential between U.S. and Asian rice and because of Mexico's decision in 2008 to remove import duties on non-U.S. origin rice in response to rising global rice prices.  In addition to fighting border restrictions, USA Rice has commenced various promotional activities aimed at protecting U.S. market share.

 

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