Corn is the basis of one of the most representative foods of Mexican food: tortillas, and countless derived dishes. However, the increase in the cost of grain has not given respite to the price of a kilo of tortillas, and there is bad news: in the short term, the outlook will not change.
Between January 2021 and June 2022, the price of tortillas has shot up 26.45%, according to the Inegi Consumer Price Index. However, the price varies by state: in the city of Hermosillo , Sonora, for example, a kilo of tortilla cost 27 pesos on July 6, while on the same day in Tlaxcala it was possible to find 14 pesos , according to the Sistema National Information and Integration of Markets (SNIIM).
For now, the Red del Maíz de la Ciudad de México, which integrates mills and tortilla factories, established a working table with the Secretariat of Economic Development (Sedeco) to seek stability in the acquisition of the price of corn and other inputs, with the in order to contain the impact of its rise. However, for Blanca Mejía, a representative of the organization, the problem has been going on since 2018.
Mejía, who also owns three tortilla factories in the country’s capital, reports that as of that year, and until now, the cost of a ton of corn has gone from 4,900 to 8,400 pesos, an increase of 71.4% . This led the microentrepreneur to raise the price of a kilo of tortilla from 14 to 20 pesos in the same period, an increase of 42.8%.
The situation forced small producers to look for alternatives. One of them, explains Mejía, was to travel to Sinaloa to buy the grain, but found it difficult to transport the corn and store it in Mexico City. Meanwhile, the rise in price has an impact on its consumption. In 2013 each inhabitant consumed between seven and eight tortillas daily , this figure was reduced to two tortillas , according to data from the organization.
“Fewer and fewer people consume tortillas. People already buy a kilo or two kilos, they take what they can afford. If he has 10 pesos, he buys that, he adjusts to what his pocket allows him,” says Mejía. “This scenario of constant increases in the price of corn leads us to diversify the market ; We see that entrepreneurs immediately seek to integrate other services, such as the sale of food”, he adds.
But the rise in the price of corn is not the only impact, since increases in energy sources such as gas and water are also added.
Marcela Martínez Pichardo, president of the National Maize Chamber (Canami), comments that the presidential decree that prohibits glyphosate limits imports of maize containing this substance, in addition to establishing the revocation and abstention of permits for planting transgenic maize and the use of genetically modified corn grain in feed, which will lead to an increase in the price of corn by 2024 , when it comes into force.
“The concern is that it would not only affect the tortilla, but also the 60 industrial sectors that coexist, and, not having access to a supply from abroad, we would all have to go out and compete for the grain and not only would the supply be complex, but the product would become more expensive; If today there is an inflationary issue, in 2024 it would be delicately affected and then I do not want to imagine tortilla prices at 70 pesos , “he says.
To deal with this, the Chamber would seek to extend the time for the entry into force of the Presidential Decree.
Looking to the southeast
According to Marcela Martínez Pichardo, president of Canami, 45 million tons of corn are consumed in Mexico, of which 40% is imported, while the remaining 60% is produced nationally. With a view to self – sufficiency , the Chamber seeks to promote the planting of corn in the southeast of the country and increase its current productivity of 2.1 tons per hectare , since the national average is 3.5 tons per hectare .
To strengthen the value chain, the Confederation of Industrial Chambers (Concamin) seeks to create synergies with other actors to develop the infrastructure that allows grain to be transported from the southeast to the rest of the country, with a long-term vision.
With this proposal, Canami sees an opportunity to increase production and the country not only balances the grain’s trade balance, but also becomes an important supplier of corn worldwide.
“In Mexico there is a great opportunity to develop the field. The south of the country has water, an issue that has been getting more complicated in the north, which is why we are seeking to generate infrastructure conditions. storage, and rail, sea and road cargo that allows us to move the grain to the processing centers, which are mainly located in the center and north of the country”.
For now, Martínez Pichardo considers that beyond the Package Against Inflation and Famine (PACIC) , the price of grain and the supply with respect to the percentage that is imported depend on issues such as the cost of energy or maritime transport, which has been expensive since the start of the pandemic. “It’s a big effort, but it doesn’t depend on just one circumstance ,” he says.
