Market Trends of Mexico Lime Industry
Increased Production in Mexico
As per the Food and Agriculture Organization of the United Nations (UNFAO), Mexico and Brazil are the world's largest producers of lime. However, because of the lack of refrigeration, key limes are preferred in Mexico as they have a longer shelf life. Mexico accounts for 14.3% of the global lime production in 2021, where lime yields an average of 15,253 kg per hectare. The major regions producing almost 67% of limes in Mexico are Colima, Michoacan, Jalisco, and Oaxaca. On the other hand, Veracruz accounts for about 27% of the production of lime/lemons, which are mostly concentrated in the Yucatán Peninsula.
Lime production is also impacted by the effect of drug cartels in Mexico. When lime prices soar, the extortion of lime farmers by drug cartel members is common. There have been reports of armed cartel members robbing trucks of limes headed to the United States. The country is the major exporter to the United States, and therefore, the market value depends on consumption and demand from other countries. Soft drinks companies are majorly focusing on lime as it serves as an ideal ingredient for soft drinks. Increased awareness about the health benefits of lime among consumers is augmenting the demand for lime-based products in the market.
Growing demand from processing industry
Lime is a commonly used ingredient in Mexican cuisine and is an essential component of many popular dishes such as guacamole, ceviche, and salsa. Additionally, lime juice is a popular ingredient in beverages such as margaritas and other cocktails. According to a report by the UN Comtrade, the export of Mexican limes and citrus fruit reached a record high of 690 million metric ton in 2020, up 36.2% from the previous year. The United States is the largest importer of Mexican limes, accounting for over 80% of the total exports.
This surge in demand for lime products has led to the expansion of the lime fruit processing industry in Mexico. Due to this, there have been various strategies adopted by the processing companies. For instance, the Mexican lime processing company, Grupo Maipo was acquired by the US-based company, Limoneira. The acquisition will allow Limoneira to expand its operations in Mexico and increase its capacity to process and distribute lime products. In recent years, there has also been an increasing trend toward the use of lime in non-food applications, such as cosmetics and cleaning products. This may also be contributing to the growing demand for lime fruit processing in Mexico. Therefore, the demand for lime fruit processing is expected to grow in Mexico as the country's cuisine and economy continue to develop.
