In 1989, the portrait of the U.S. rice industry and that of the Mexican rice industry was very different from what it is today.

In 1989, all rice purchases in Mexico, both local and imported, were controlled by the government agency CONASUPO. All rice imports by Mexico were from Asia.

Half of Mexico’s rice production came from the Pacific state of Sinaloa. That year, the Sinaloa Rice Association held its annual meeting in Houston and met with U.S. rice representatives of what was then the USA Rice Council in Houston to inquire about purchasing U.S. rough rice.

Later that year, the Mexican government allowed the first private purchase of rice and the Sinaloa group purchased 25,000 metric tons of U.S. rough rice. From these humble beginnings, the U.S. industry has nurtured the rough rice export market to Mexico into the number one export market for U.S. rice in any form.

Today, Mexico accounts for 800,000 tons of sales annually. These sales were valued at almost $353 million in 2008. And, for several years, Mexico has been the number one market of all U.S. rice exports.

It wasn’t an easy building process for the U.S. rice farmer. The USA Rice Council had spent years building a relationship with the Mexican rice industry, starting with those in Sinaloa, through numerous trade missions and by hosting Mexican buyers to the U.S.

It became apparent that the U.S. had a niche in Mexico — selling rough rice to Mexican mills. However, resistance within the industry to limit rough rice sales to Mexico and other countries had become a topic of concern for many.

Both during and after the formation of the USA Rice Federation, those favoring exporting all forms of U.S. rice found themselves at odds with those favoring the continuation of only milled rice exports.

The U.S. rice industry split into two organizations: the US Rice Producers Association (USRPA), formed by and for rice farmers, and the USA Rice Federation (USARF).

Due to the natural trade relationship between USRPA and the Mexican rice industry, these two organizations were able to work amicably to open and build this market. This was especially apparent during the formation of the Mexican Rice Council and when the North American Free Trade Agreement (NAFTA) was negotiated.

The rough rice market has become the backbone for U.S. rice farmers. It has helped to counter losses of U.S. milled rice markets in Europe, the Middle East and elsewhere.

Also, Mexico, and later Central America could have easily become Asian milled markets had the USRPA and the trade in these countries, like the Mexican Rice Council, not joined forces to preserve U.S rough rice exports.

The late Mexican Rice Council president, Antonio Lajud, worked with the USRPA to this end.

“Without these rough rice sales to Mexico and the rest of Latin America, I’d be out of business,” says Ray Stoesser, a rice farmer from Dayton, Texas and a member of the USRPA board of directors. “And, I know a lot of other rice farmers that would have been in that same situation,” he adds.

Jim Willis, a former USRPA employee who spent considerable time in Mexico over the years says, “A market attained must be maintained. The USRPA maintaining and expanding rough rice sales to the Mexican market is not different than efforts of the USARF to maintain U.S. milled rice markets in Japan and Turkey. Sales are based on first providing a specific type or form that best meets the need of those selling in the market and then jointly promoting for the benefit of all.”

When the US Rice Producers Association was established in 1998, one of its first efforts was to take a step back and review the past, present and future of the Mexican rice market. It was obvious the market presented great opportunities, but the time had come for the U.S. rice industry to re-focus its programs and promotional activities.

What had been effective? What needed improvement? How did we need to move forward in the future? These and other questions needed to be addressed.

After all, Mexico had a low per capita consumption of rice, yet with a population of just over 100 million people, the market offered great potential.

Thanks to funding from the USDA’s Foreign Agricultural Service and an endorsement from the USA Rice Federation, the USRPA spearheaded a research project designed to take a close look at the Mexican rice market. The funding allowed the research effort to be conducted by the Texas Agricultural Market Research Center at Texas A&M University.

The Center studied, explored and analyzed the structure of the Mexican rice market in order to provide recommendations that would guide strategic planning for the marketing of U.S. rice. Completed in February 2000, the research project provided valuable insight and guidance on the opportunities and challenges for future growth of U.S. rice exports to Mexico. The Center recommended activities that are still being used successfully today by the U.S. rice industry.

The research and recommendations have proved to be “spot on” for providing growth markets for U.S. rice. By promoting to the lower socio-economic classes, instead of high-end consumers — Mexican resorts, hotels and restaurants — USRPA programs have impacted the sales and per capita consumption of rice among large areas of the population of this huge country.

The USRPA conducts its programs in seven states that represent 33.5 percent of the total gross population of Mexico, including two of the most populated cities, Mexico City and Monterrey. This strategy continues to pay dividends to U.S. rice farmers and the entire U.S. rice industry.

School lunch program

The USRPA conducts programs in schools to teach school cooks — mothers who cook in the schools for the children — how to prepare nutritious, low cost meals with rice. The USRPA teaches them about the proper handling and storage of rice, and about the attributes of rice.

In 2008, the school program was conducted in 2,894 schools in seven states, training more than 83,000 mothers and feeding a nutritious meal to 617,799 children. By promoting in schools, USRPA’s program has successfully targeted three groups: Today’s users and consumers represented by the school cooks/mothers; change agents represented by the school authorities and teachers; and tomorrow’s users and consumers — the hundreds of thousands of students/children fed and directly touched by the program.

In the areas where the school promotions took place, consumption of rice increased an average of 2.36 percent — an additional 1,543 metric tons of rice was sold in these markets due to the school promotion. This data is validated by reports from three of the major rice mills in Mexico which reported sales increases of 0.83 percent, 3.02 percent and 5.61 percent.

DICONSA promotions

Another USRPA program partners with DICONSA, a government chain of warehouses and 23,000 stores that serve the lower socioeconomic groups.

At the DICONSA sites, the USRPA program conducts seminars on rice. Consumers are taught how to cook rice, about its nutritional benefits, and are provided recipes using rice in both traditional and new ways. The promotions are very popular with the people and the promotions positively impact rice sales.

In 2008, the average increase of rice sales at these markets in the State of Veracruz was more than 5 percent over 2007 sales. Sales data provided by DICONSA in the stores where the USRPA promotions took place ranged from 16.22 percent increase to a 2.19 percent increase.

Un Kilo de Ayuda

Un Kilo de Ayuda is designed to give the rural poor nutritional help and to better their lives. By teaching them about nutrition and how to make more nutritious, low cost meals using rice, the USRPA partnership with this program has increased rice use in these communities.

Consumers participating in these programs were surveyed in 2007 and 2008 to determine how often they eat rice.

In the areas of Veracruz where the programs were conducted, there was an 8.2 percent increase in the number of people who eat rice once per day. In the Puebla areas, those who eat rice once per day increased from 27 percent to 43 percent. In the Oaxaca areas the number of people who ate rice once a day jumped from 9.8 percent in 2007 to 38 percent in 2008.

Previous research has shown, on average, Mexicans only consume rice three times a week.

Among the partnerships developed in Mexico over the years, of particular importance is the one with the Mexican Rice Council (MRC) and its board of directors. Regular meetings between both the USRPA and the MRC will assure the market is properly serviced in the years ahead.

As stated recently by Jorge Buganza of the GGI Insumos Rice Mill in Mexico, “The promotional work that is being conducted in the schools, markets and communities — teaching about preparing rice and other practical information — is excellent. In Mexico, rice is not a staple in the diet of our people, but where these promotional activities have been held, we have information that shows rice consumption has increased.

“When the USRPA first started with the promotional campaigns, we gladly joined with them delivering rice with our brands to use for sampling and other activities. Not only have these activities helped sales of our brands, but we have noticed that it helps and supports all brands of rice, imported and national. I really hope these activities continue for a long time for the benefit of the U.S. and Mexican rice industries.”

There have been many changes since that first sale of U.S. rough rice to Mexico in 1989. But one thing remains — the Mexican rice industry and the U.S. rice industry are very dependent on each other.

Today, the question over the validity of selling U.S. rough rice has evolved from a debate into a more productive and harmonious effort of growing the market. The efforts of the USA Rice Federation has concentrated on the niche market of higher income consumers thanks to the leadership and expertise of Gaby Carbajal’s numerous years of experience in Mexico. This program, too, contributes one aspect to what the Mexican rice industry needs and good customer relations which has helped to keep the market out of Asian hands.

All these programs combined increase rice consumption in Mexico and have captured a 100 percent share of the Mexican rice import market for U.S. rice. These programs must be maintained for the health and survival of our producers and others in the U.S. rice industry.