Genesus Global Market Report Mexico – Oct. 2019

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Genesus Global Market Report

Mexico – Oct. 2019

Fernando Ortiz, Ibero America Business Development at Genesus Inc.

Last week we attended the National Swine Congress of Mexico in Puerto Vallarta, which had a large attendance and a variety of exhibitors, both in the commercial area and at the conference auditorium.

With relatively stable prices during this year, the main fear of Mexican producers is the possibility that the African swine fever permeates the country’s borders. Many of the presentations were dedicated to this topic. In this regard, Secretary Villalobos said that from the Mexico’s Secretary of Agriculture and Rural Development they are aware of the health concerns that threaten the industry, by reporting that all the resources are available to protect it. The second topic was the one referring to international markets, especially the one that has to do with China.

While recently Mexico’s Secretary of Agriculture and Rural Development, Víctor Villalobos Arámbula estimates a 5.7 percent growth in the national swine industry with respect to the million 501,000 tons of pork produced in 2018, we heard at the conference a constant claim about a domestic shortage of pork, mainly due to the presence of diseases (PRRS, PED) devastating some pig areas in Mexico.

The second effect of Mexico’s reduced pork availability has been the tariff war with the United States. Mexico is the largest pork importer country from the U.S. with chilled bone-in hams and shoulders primals which account for the largest share of the overall cutout. Up until May, these products faced a 20% tariff in the Mexican market. After tariffs were lifted the Mexican importers are still trying to recover to pre-tariff levels.

Consolidation is happening in the Northwest part of the country lead mainly by the two major swine groups located there. Several of the sow barn’s owners we knew from the past have migrated to an integrated system, just like Keken did in Yucatan, to join the two biggest groups as a grow-finishing production.

The market weight continues to rise, averaging 130 kg. in some States. So, basically there is not reduction on number of sows, but consolidation. The trend continues due mainly to the successful of the Yucatan’s model.

Liveweight Mexican Price

National Average Price

Peso/Kilo

$US/Lb

At the farms door average

28.68

0.67

Mexico City Average

28.73

0.67

Annual Accumulated Average Farm

29.50

0.69

National average by State

Peso/Kilo

$US/Lb

Sonora

25.10

0.59

Yucatán

34.00

0.80

Guanajuato

27.00

0.63

Jalisco

27.60

0.65

Michoacán

26.50

0.62

Puebla

30.80

0.72

Querétaro

30.80

0.72

Veracruz

32.00

0.75

Get acquainted with the
Global Mega Produce

A program of recognition led by National Hog Farmer sponsored by Genesus Inc.

Muyuan Group

Muyuan Group is recognized as a Global Mega Producer for 2019.

Muyuan Group was established in 1992, its main business is hog farming (accounting for over 99% of its total revenue) which has been developed in coordination with other businesses including feed processing, swine genetics, hog slaughtering. Currently the total asset of Muyuan Group is 55.3 billion yuan with more than 40,000 employees and more than 150 subcompanies. The hog farming business covers 93 counties in 14 provinces all across China.

The subsidiary company – Muyuan Foodstuff Co., Ltd was listed in the stock market in January 2014, its current market value is over 150 billion yuan. In 2018, the company marketed over 11million hogs.

Facing with the severe situation caused by ASF, Muyuan Group has been dealing with it in a positive way and continuously groping for good experience and practice for prevention and control of ASF, which has resulted in a fast recovery and even further expansion in the number of sows in their production system. It is estimated that by the end of 2019, their sow inventory will reach 900,000 head.

Let’s congratulate on the great achievement and all recognize Muyuan Group as an industry leader and 2019 Global Mega Producer.

Photo from left to right: Yaping Gu-GM for Genesus China; Lyle Jones- sales direct for Genesus China; Li Yanpeng-production director for Muyuan Group; Tian Fangping-Technical consultant for Muyuan Group

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