Mexican beans and chickpeas in 2024/
Sahid Hernandez on the impact of drought and a fluctuating peso

Sahid on… the last year at Terminel

• “Over the last couple of years we've grown a little more slowly, a little more cautiously in terms of tonnes exported. This was our fifth year exporting and we managed to export 14 KMT. I've been working on getting the final shipments as we are at the end of our harvest, which hasn't been easy as it's been a difficult year for logistics.”

• “We've also begun talks to add on an extra line of production to raise our chickpea export capacity, although I’d say that's a medium-term plan for us as it’s something that requires a lot of careful planning. We have also expanded into some new destinations, exporting into both Morocco and Guyana this year.”
  
  

…entering into the black bean market

• “In terms of products, we also began importing black beans from Argentina and the US into Mexico this year. This was because the drought affected the production and sales of both corn and farming inputs – two of Terminel’s biggest exports.” 

• “Farmers will always look to plant corn if they can, but since there is no water, acres of corn have been drastically reduced. As a company you have to find different options and keep things ticking over. I'm not sure if we will continue to import black beans though, that will depend on the circumstances. Over the coming year, Mexico will definitely need to bring in a certain amount of black beans to satisfy demand, as well as making aggressive purchases of corn.”
  
  

…the last year of chickpeas in Sinaloa

• “Last year we had expected a large chickpea crop but it wasn't quite as big as expected in the end  – around 130-140 KMT. There was no carryover from 2023, and despite some of the logistical problems, exports quickly got into a good rhythm from April to August, then things stopped for two months as there was no shipping availability. But in October they began offering ships again and we were able to export everything that had been waiting for export over the previous two months.”

• “Turkey has been a really consistent buyer for us, and the purchases from Algeria also ensured that exports have flowed as much as before. Prices started out at around $1500-1550/MT but I have heard some exporters giving prices lower than that. One purchase in August/September went to Algeria at the price of around U$1800/MT.” 

• “I think we've seen a strategy on the part of Turkish companies to buy Mexican chickpeas then forward them on to other destinations like Algeria this year – there was a tender in late October won by a Turkish vendor using Mexican products they had stored and ready to go.”
  
  

…the upcoming chickpea crop

• “Without good access to water, corn just isn't profitable for farmers, so lots of acreage simply won't be seeded this year. Chickpeas and beans can be a replacement crop but farmers don't like the changes in price.”

• “In October, a meeting of the Sinaloa government put forward a projection for the harvest that suggested 60,000 ha for beans and another 60,000 ha for chickpeas. The Governor of Sinaloa recommended farmers consider planting more beans, so the chickpea total is similar to last year – it will likely produce a crop between 120-130 KMT – but there is also more emphasis on the production of beans this time around.”
  
  

…importing from the US with a high exchange rate 

• “Something that has a big impact economically for Mexico at the moment is the high exchange rate between the peso and the dollar – right now it's around 20 pesos/USD, which means it’s better to be exporting to them rather than importing. Last year when the exchange was around 18 pesos, it made it a lot easier for us to bring in imports – every thousand dollars paid at the 18 peso rate compared to 20 peso rate saves you 2000 pesos. It's an important difference.”
  
  

…the change of US government and renegotiation of the USMCA treaty 

• “We're going to have to wait and see with regards to commercial relations between Mexico and the US. We don't know exactly what the new government is going to look for. I can say that for Mexico, we would like things to keep going as they are – for better or worse, things have been working.” 

• “In terms of our economy we are dependent on the United States, and large-scale deportations could affect us both in terms of lowering funds sent back to families in Mexico from the US – which help Mexico from a commercial perspective – but also in terms of security.”

• “There's a lot of speculation about what's going to happen, but I think it will likely see some kind of import tax. As for the USMCA agreements, there was always going to be renegotiation as the agreement itself demands that. The worst-case scenario would be that Mexico is excluded from the agreement. We've already seen that some of the talks between Canada and the United States suggest that there are going to be some changes between them, but it seems like there is a risk of that when it comes to Mexico.”

• “Everything will depend on how protectionist the new government decides to be. A lot of agricultural products go to the United States, so it will be important to know, but the US buys the Mexican products because it benefits them – in the end these trade benefits both countries.”