Mexico is an agro-exporting country par excellence due to the fact that the U.S. market is the largest consumer of fresh agricultural products, which has prompted many Mexican farmers to engage in the production of high value crops.
A high value crop refers to any crop whose sale price is high, either for the domestic market or for export, however in the case of Mexico it almost always refers to agricultural products that are exported to the United States, where they are paid in dollars, so the prices achieved are higher, at least compared to the prices paid in the domestic market.
For this reason, farmers who already export are interested in increasing their agricultural exports to the U.S., and we are not only talking about Mexican producers, since producers from several Central and South American countries have the same interest, with Peru, Colombia, Chile, Brazil and Argentina being the ones that send the most shipments to the United States.
Key elements to achieve this
In order to grow agro-exports, the challenge can be approached from different perspectives: agronomic, economic, operational, commercial, etc., and in fact it is advisable to analyze all possible aspects in order to detect where the greatest opportunities for improvement exist.
However, three key elements that should always be kept in mind are financing, information and technology.
Agricultural production is an activity that requires economic investment, an investment that is recovered several months later, although, of course, the risk of not recovering it is always high, since the production, distribution and marketing of agricultural products involves risks at all stages.
That is why, as a farmer, you may have to apply for some type of financing, since getting to the harvest with your own money is not always possible, although in this matter you have to pay close attention, because a financing product that does not adequately cover your capital flow needs will be a problem rather than a solution.
In addition, the agricultural sector is highly risky for traditional banks, so their financing is usually not the most suitable for you as a farmer, since you need a more flexible solution.
At ProducePay we understand this and therefore we offer two types of financing: Pre-Season, which allows you to boost your season, receiving between 200,000 and 5,000,000 million dollars up to 12 months before your harvest, and Quick-Pay, through which you receive up to 80% of the value of your shipment the same day that your distributor confirms the arrival of the product. If you want to know more, visit our financing section.
All business involving fresh agricultural products (fruits and vegetables in the case of agro-exports of high value products) gets involved in markets that change due to the influence of external factors over which we have little or no influence, but it is necessary to know the variations to avoid unexpected problems at the time of sales.
For this reason, and although we cannot change many things, it is essential to have first-hand information about the current status of the market regarding the product or products of interest, since having this information will allow you to make better decisions.
Some examples of what the right information would allow you to know are: the months with the highest and lowest sales prices, the times of the year when the volume entering the U.S. market is higher and lower, the prices being paid for conventional and organic, changes in consumer preferences, products with the potential to increase sales soon, among others.
As a company focused on financing agricultural exporters we also know the importance of having the right information, so we offer you our reports section, where you will find information on volumes and prices of various agricultural products in the U.S. market. In addition, if you subscribe you will receive a daily report with information on the products that are of interest to you.
New technologies are finally coming to agriculture, which will help to improve agrifood chains, but of course, it is not a matter of adopting a new technology just for the sake of it, it must solve a specific need.
No matter how great a new technology may seem, if it does not solve a specific problem in the field, and more importantly, if it does not increase your economic return, then it is probably a technology that you should not implement, otherwise it will become a waste of money and time.
Among the technologies that can be applied in agriculture, digital technologies are representing efficient solutions to daily problems, and one of the biggest challenges is to connect buyers with sellers, a challenge we, at ProducePay, are addressing with our Marketplace, through which we seek to boost your agro-exports through secure transactions.
Traditionally, business between sellers and buyers of agricultural products has been high risk, as it is fairly common that one of the two parties does not comply with the conditions established in the deal, which is often only a verbal agreement, which has caused several Latin American agro-exporters to lose their payments.
We are very familiar with this situation, that is why our platform is based on the pre-qualification of both sellers and buyers, which means that whoever enters has the total certainty that he/she will make business deals with contacts that will fulfill those deals. In addition, thanks to our team of technological specialists, the verification of potential contacts is done fast, meaning that you could be part of our network today.
The human element is also important
When analyzing how you can grow your agro-exports, you also need to consider the human element, because although technology, information and financing can give you a huge boost, you must not forget that agriculture is a sector based on relationships.
You may even have the best of the three elements mentioned above, but if you don’t have the right people then you could have major problems at any stage of the agri-food chain, and of course, you could miss out on excellent business opportunities.
Having the human talent that your agro-export business needs implies to clearly define the appropriate profiles, because agro-export is an activity that requires very specific knowledge, skills and experience, such as full command of English language negotiations, knowledge of the U.S. market, customs, export requirements, post-harvest handling, pricing, etc., and experience exporting fresh produce, to mention only the most important ones.
We are the ally your business needs
We know the financing, technology and information needs that agro-exporters require, so we generate flexible solutions that allow you to obtain results with your agribusiness. We are a company born from farmers and is focused on farmers.