NAFTA Exports Distribution

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    The Mexican Food Market:

    -NAFTA

    -Domestic

    -DistributionChannels

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    2

    NAFTA

    Mexico, Canada and USA signed a Free

    Trade Agreement that went in effect in 1994Some agricultural products became dutyfree immediately and others under a 5, 10and 15 year phase out under a quota

    administration.

    Both US and Mexico Agricultural Exportsincreased as a result of NAFTA

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    3

    NAFTA

    Each country has increased its export

    trading in different segmentsSome industries have gain growth andothers have been hurt by NAFTA

    In the three countries, there has beenmixed opinions of NAFTA. The numbers

    have shown results to each of the countriesin different segments

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    Other Mexicos FTAsOther Mexicos FTAs

    Mexico is currently the country with most freeMexico is currently the country with most free--trade agreements in the world. Thetrade agreements in the world. Thefreefree--trade agreements in force are (ordered by date):trade agreements in force are (ordered by date):

    North American Free Trade AgreementNorth American Free Trade Agreement (NAFTA)) (1994):(NAFTA)) (1994): CanadaCanada and theand the UnitedUnitedStatesStates..

    ColombiaColombia andand VenezuelaVenezuela, also called, also called GG--3 Free3 Free--Trade AgreementTrade Agreement (1995)(1995)

    Costa RicaCosta Rica FreeFree--Trade Agreement (1995)Trade Agreement (1995) BoliviaBolivia FreeFree--Trade Agreement (1995)Trade Agreement (1995)

    NicaraguaNicaragua FreeFree--Trade Agreement (1998)Trade Agreement (1998)

    ChileChile FreeFree--Trade Agreement (1999)Trade Agreement (1999)

    EU (EU (European UnionEuropean Union) Free) Free--Trade Agreement (2000)Trade Agreement (2000)

    IsraelIsrael FreeFree--Trade Agreement (2000)Trade Agreement (2000)

    MexicoMexico,, GuatemalaGuatemala,, El SalvadorEl Salvadorandand HondurasHonduras, also called TN Free Trade, also called TN Free Trade

    Agreement (2001)Agreement (2001) IcelandIceland,, NorwayNorway,, LiechtensteinLiechtenstein, and, and SwitzerlandSwitzerland, also called AELC (, also called AELC (AsociacinAsociacin

    EuropeaEuropea dede LibreLibre ComercioComercio) Free) Free--Trade Agreement (2001)Trade Agreement (2001)

    UruguayUruguay FreeFree--Trade Agreement (2004)Trade Agreement (2004)

    JapanJapan FreeFree--Trade Agreement (2005)Trade Agreement (2005)

    MercosurMercosurFreeFree--Trade Agreement (ratification pending)Trade Agreement (ratification pending)

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    U.S. Agricultural Export

    Trends & Highlights

    jMexico is the secondlargest market for U.S.agriculture.

    jIn 2007 U.S. agricultural,forest and fish exports

    totaled $13.3 billion.

    US Ag. Exports to Mexico

    10 0 10

    3 9 7 4 59 5136 0 0 56 0

    75 70 6 8 6 1 59

    13322

    9 0 3 8

    1154 1

    8 3 6 3

    3 6 3 62 9 8 631483 0 4 5

    4575

    2 2 4 41680

    19582 3 8 1

    3 0 9 0

    4 8 6 4 5 0 3 8

    3 4 0 33165

    4 2 0 0

    0

    2,000

    4,000

    6,000

    8,000

    10,000

    12,000

    14,000

    2003 2004 2005 2006 2007

    Total Bulk

    Inte rm ediate Cons um er-Re ady

    Forest Products Fishery

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    Top U.S. Bulk Product MarketsTop U.S. Bulk Product Markets

    $0

    $1,000,000

    $2,000,000

    $3,000,000

    $4,000,000

    $5,000,000

    $6,000,000

    2002 2003 2004 2005 2006 2007

    MEXICO

    CHINA

    JAPAN

    TAIWAN

    KOREA

    EGYPT

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    $0

    $2,000,000

    $4,000,000

    $6,000,000

    $8,000,000

    $10,000,000

    $12,000,000

    $14,000,000

    $16,000,000

    $18,000,000

    2002 2003 2004 2005 2006 2007

    Mexico

    Canada

    Japan

    China

    Korea

    Taiwan

    Egypt

    Germany

    United King dom

    Top Markets: Total Agricultural, Forestryan

    d Fish

    ery Products

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    Top U.S. Bulk Product MarketsTop U.S. Bulk Product Markets

    $0

    $1,000,000

    $2,000,000

    $3,000,000

    $4,000,000

    $5,000,000

    $6,000,000

    2002 2003 2004 2005 2006 2007

    MEXICO

    CHINA

    JAPAN

    TAIWAN

    KOREA

    EGYPT

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    Top U.S. Intermediate Product MarketsTop U.S. Intermediate Product Markets

    $0

    $500,000

    $1,000,000

    $1,500,000

    $2,000,000

    $2,500,000

    $3,000,000

    $3,500,000

    2002 2003 2004 2005 2006 2007

    Mexico

    Canada

    China

    Japan

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    Top U.S. Consumer Product MarketsTop U.S. Consumer Product Markets

    $0

    $2,000,000

    $4,000,000

    $6,000,000

    $8,000,000

    $10,000,000

    $12,000,000

    2002 200 2004 200 2006 200

    p

    Russ

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    Whythe U.S. Market In MexicoWill Continue to Grow

    j Economic Growth higher percapitaincomes

    j(middle class growing and poverty being reduced)j

    Demogra

    ph

    ics - growth

    in

    middle cla

    ssj Growing urbancenters = increase buyersj Improvements intransportation= distributionj Changing eating habits = convenientorientedj Growthin supermarkets = increase points of sale

    j Growthtourismandrestaurants = + consumersj Growthin processedfoodindustry = more

    intermediate productneedsj NAFTA = more efficiencyin production

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    Food Distribution in MexicoFood Distribution in Mexico

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    DomesticDomestic FoodFoodDistributionDistribution

    National Product

    Producers

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    Domestic FoodDistributionDomestic FoodDistribution

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    Domestic FoodDistributionDomestic FoodDistribution

    National Product

    Producers

    Wholesale

    CentralMarket

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    Central Market Mexico CityCentral Market Mexico City

    30% of total produce, is30% of total produce, ismarketed through thismarketed through thischannelchannel

    1,881 warehouses for1,881 warehouses forfruits andvegetablesfruits andvegetables

    338 wareh

    ouses for338 wareh

    ouses forgroceriesgroceries Warehousing: 122,000 MTWarehousing: 122,000 MT

    The average monthly trade:The average monthly trade:

    700,000 MT offruits700,000 MT offruits500,000 MT ofvegetables500,000 MT ofvegetables170,000 MT of groceries170,000 MT of groceries

    8,000 MT offreshflowers8,000 MT offreshflowers

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    Central Market in Mexico CityCentral Market in Mexico City

    Area of 300 hectaresArea of 300 hectares

    8 billiondollars yearly8 billiondollars yearlyturnoverturnover

    On a daily basisOn a daily basis

    6,000 trucks6,000 trucks

    70,000 direct employees70,000 direct employees

    300,000 visitants300,000 visitants

    50,000 veh

    icles50,000 ve

    hic

    les

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    FoodFoodDistributionDistribution FlowFlow ChartChart

    NationalProduct

    Producers

    WholesaleDistributors

    FoodServiceSupermarkets

    CentralMarket

    FoodManufacturing

    FixedMarkets

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    Fixed Markets (Mercados)Fixed Markets (Mercados)

    Popularmarkets located in olderPopularmarkets located in older

    neighborhoodsneighborhoodsHousewives would purchase produce,Housewives would purchase produce,fruits, groceries, deli, dairynonfoodfruits, groceries, deli, dairynonfoodgroceries etc.groceries etc.

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    FoodDistribution flow ChartFoodDistribution flow Chart

    NationalProduct

    Producers

    WholesaleDistributors

    FoodServiceSupermarets

    CentralMarket

    FoodManufacturing

    FixedMarkets

    MovingMarkets

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    Moving Markets (Mercados SobreMoving Markets (Mercados SobreRuedas or Tianguis)Ruedas or Tianguis)

    Over 2,000 moving markets around the countryOver 2,000 moving markets around the country

    Housewivesfrom all income levelslike to shop there forHousewivesfrom all income levelslike to shop there forthe freshest produce, importedfruitsand other groceriesthe freshest produce, importedfruitsand other groceriesYou are able to findfish, meats, deliYou are able to findfish, meats, deli--meats, dairymeats, dairyTheyserve Mexicanfastfood aswellTheyserve Mexicanfastfood aswellThey appear inspecificstreetscertain day of the weekThey appear inspecificstreetscertain day of the weekin a periodic basisin a periodic basis

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  • 8/8/2019 NAFTA Exp