Summary

• The total export value of Mexico's forage products cumulatively, including hay as of 2018, stood at the $17. 78 million. 
• The United States is considered Mexico's principal agricultural partner. It has primarily remained the country's market for agricultural produce this largely because of geographical advantage.
• According to a report, Mexico became the second-largest importer of hay through July of this year, Canada led the list. Mexico was also the second importer of Hay to the US in the previous year.
• It's estimated that US imports from Mexico increased by 13.79%, which is roughly $1.35 million.
• The ministry of environment in Mexico is against the extraction of Hay in Mexico. According to the ministry, hay extraction contributes to environmental destruction as hay protects the soil against soil erosion and acts as animal protectors.

Research Strategy

Findings

• "Alfalfa is the main forage crop in Mexico in terms of area planted with 583,561 ha, which represents 57.1%, while the forage crops corn, oats, and sorghum represent 42.9%."
• 10.7 million tons of alfalfa hay is produced in Mexico annually.
• Sonora, a state in northern Mexico, has a "large base of irrigated ryegrass for backgrounding cattle in the dry winter period."
• In 2016-17, Mexico imported 4 million lbs. of annual ryegrass seeds and 4.4 million lbs. of sudangrass seeds from the US.
• Pastures and meadows are spread over approximately 80 million ha of land in Mexico, roughly 10-15% of the harvested land.

Research Strategy

• According to the report from GM Insights, the various product formats of Alfalfa hay include bales, pellets, and cubes.  
• Bales are the most typical format of this product. This format can come in "two-string bales, three-string bales, and up to six-string bales weighing up to half-a-ton." These bales can also be configured as square bales that weigh around 25 to 35 kg.
• The product can also be presented as round bales with a diameter ranging from 1.4 to 1.8 meters, and with a weight range of 100 to 500 kg.
• The product is typically ordered in bales than pellets as the former has more size and weight options. Bales are also more convenient to transport.
• Haylage is also a preferred format for dairy cows as it is more flavorful and can maintain its nutrient levels for a long time. Haylage is composed of finely chopped and fermented Alfalfa.
• Meanwhile, a harvest report from the Agriculture Department of Mexico features a picture of a large Alfalfa hay bale.  
• The Mexicali Valley in Mexico was able to harvest 536,838 tons of Alfalfa in the area.
• Between 7 and 8 crop cuts were done to harvest the Alfalfa.
• Meanwhile, a vendor sourcing from the Mexico region reported that they bale the Alfalfa hay that they harvest into" 3-tie bales or big bales."
• Their bale sizes range from "small to large, and bale weights include 30 kg., 60 kg., 120 kg., and 450 kg. " These sizes make it easier to optimize the loading into sea containers to minimize costs.

Research Strategy

Helpful Findings

• The majority of hay is produced and used for the country's dairy industry while significant quantities are sold.
• Mexico is the second-highest exporter of hay to the United States. From January to July 2020, Mexico exported hay valued at about $11.14 million to the United States increasing Mexico's hay export to about 14%.
• According to research published by Elsevier, small-scale dairy enterprises contribute 35-40% towards hay production.
• The majority of the hay is produced by commercial companies that collect the hay product from local farmers. About 60-65% of the hay production is done by Alfalfa Hay, Humberto Ramos, MGM, Santa Lucia, and others. However, Grupo Corrales Sonora ​is the sole supplier of Timothy hay in Mexico.

Research Strategy

Findings

Dairy Cows

• According to Index Mundi, the total number of dairy cattle in Mexico in 2020 is 3,500,000. The typical weight of a dairy cow is about 1000 lbs.
• As a rule of thumb, a dairy cow will eat "2 to 2.5 pounds of hay per day for every 100 pounds of body weight."

• Calculations;
• A dairy cow eats between (1000x2)/100 to (1000x2.5)/100= 20 pounds to 25 pounds of hay daily.
• Total daily consumption of hay in Mexico would then be = (3,500,000x20) to (3,500,000x25)= 70,000,000 pounds to 87,500,000 pounds.

Beef

• According to Index Mundi, the total number of cattle in Mexico in 2020 is 8,105,000.
• Calculations;
• The total number of beef cattle would be =8,105,000-3,500,000= 4,605,000
• A typical beef cow would consume about 24 pounds of hay per day.
• Therefore, total daily hay consumption is =(24x4,605,000)=110,520,000 pounds.

Research Strategy

Research Methodology:

Facts & Statistics related to Hay Agriculture in Mexico:

• Mexico ranks as the 6th largest producer of animal feeds on a global scale (in 2019), producing around 34.81 million tons per year; ranking below China (187.89 million tons), USA (177.21 million tons), Brazil (68.65 million tons), Russia (39.16 million tons), and India (38.74 million tons).
• It is estimated that the animal feed production industry has a market size of 10 billion 900 million dollars in 2019.
• The estimated growth rate for the industry is between 3.3% to 3.5%.
• In 2016, around 810.49 thousand square kilometers of land in Mexico was used to grow forage crops (cultivated or wild). 
•  The main forage and hay crops are alfalfa and sorghum. These crops are farmed in arid regions, often with the use of irrigation, and are important to livestock farmers.
• Forage seed crops such as Sorghum and Millets are largely produced in Mexico because forage seeds yield better productivity of crops. Around 30 kg of forage feed is required to produce 1 kg of beef products. 
• The feed production (such as hay and other forage products) for dairy animals has continued to increase from 2012 to 2018. The feed production values (in 1000 metric tons) are as follows: 4,570 (in 2012), 4,606 (in 2013), 4,686 (in 2014), 4,843 (in 2015), 5,107 (in 2016), 5,337 (in 2017), and 5,497 (in 2018).
•  Alfalfa Hay is categorized packed, stored, transported, and sold as (i) bales, (ii) pellets, (iii) cubes, and (iv) haylage. The most common hay product is Bales, where strings are fastened around square blocks of hay weighing approximately 25-35 kg. Hay can also be stored as round bales, with a diameter of 1.4 to 1.8 meters, weighing up to 100 kilograms. Other methods of storing hay are in the form of pellets and cubes, which are finely grounded, and processed with heat and steam. Haylage, on the other hand, requires fermenting, and finely chopped alfalfa. Haylage is more palatable and is more nutritious.
• The key players in the Forage 'seed market' are: Allied Seed , DLF International Seeds , Dynamic Seeds Ltd., Brett Young , Golden Acre Seeds , Moore Seed Processors , Pickseed Canada Ltd. , and Foster Feed and Seed

•  US Trade Numbers indicated that Mexico is the second-highest exporter of hay to the United States. Between January and July 2020, Mexico exported hay valued at about $11 million to the United States.
•  Mexico's hay export to the United States increased by about 14% in 2020 and the country export share on the US market is estimated at 19%.
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  Source
   
• According to GlobeNewswire, the global alfalfa hay market, covering Mexico is expected to reach about 357 tons by 2027 and the CAGR for this market is projected to be about 6% for the 2020-2027 period. The alfalfa cubes market in Latin America is expected to grow at a CAGR of about 7% during the 2020-2027 period.
•  go4WorldBusiness indicates that the top-rated alfalfa hay suppliers and manufacturers in Mexico include Neal Farm Services, Bojormex, and Maqui Agro. According to go4WorldBusiness, Grupo Corrales Sonora is the sole supplier of Timothy hay in Mexico.

Strengths

• Mexico was among the top 20 exporters of forage in the world in 2018. It exported about $17,778,765 worth of forage. It has a global market share of 0.62%. 

• According to the US Trade Numbers, Mexico is the second-highest exporter of hay to the United States. Mexico exported hay valued at $11 million between the months of January and July 2020.

Weakness

• According to Scielo, the main forage crop in the country is alfalfa. Given its "high water demand, alfalfa may be replaced by other crops with lower water requirements."
• The production of hay in Mexico faces competition for water and land from crop production for other uses.
• According to the Mexicanist, insecurity in Mexico is negatively impacting animal feed producers. Areas such as Mexico City and Puebla have high cases of crime. Some producers have halted operations in these areas.

Opportunities

• Mexican farmers can take advantage of the increasing global demand for forage plants and export hay to major importers in the world such as the United Arab Emirates, Saudi Arabia, and China.
• Mexico can also take advantage of the growing hay needs to feed livestock around the world, as it is expected that the alfalfa hay global market will grow to $29,500 million by the end of 2026 at a CAGR of 0.1%.

Threats

• Climate change is one of the biggest threats to the hay market in Mexico. According to Scielo, the main forage crop in the country is alfalfa. The crop is threatened by the increasing "temperature and its influence upon the reduction of areas with high productive potential."
• The hay market in Mexico faces competition from other neighboring hay exporters such as Canada and the United States. The United States has a market share of 49.3% while Canada has a market share of 5.41%.
• A decrease in agricultural land due to urbanization poses a threat to the hay market in Mexico.