Rice partnerships pay dividends
Nov 17, 2009 10:13 AM, By Dwight Roberts, US Rice Producers Association
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.
