Crop Budget Spreadsheet – With a budget of 234 billion pesos, the Ministry of Agriculture and Livestock will launch the operation of more than 25 programs whose primary objective is based on three main areas – promotion and regulation activities, reconversion programs, and support to achieve Greater competitiveness and financing for the activities of the agricultural sector.
Promotion and regulation
The first point highlights the activities of SENASICA as a regulatory institution for health and safety of foods produced in Mexico.
In this respect, it is considered that the national producers have managed to increase their productive capacity by 15% during the years of management of the current Government. Therefore, sanitary regulation and processes to control food safety will be an important pillar to continue with the increase of food production in a safe way.
In this line, the budget will be applied in the management of analysis, evaluation and application of production processes, such as Good Agricultural Practices (GAP), for which training and monitoring courses will be implemented in most of the producing regions. It is important to mention that, although it has the support of certification companies and prestigious laboratories in the area of safety, official certification will continue to be of great relevance in the export sector.
In order to increase security levels and support exports of fresh fruits and vegetables, it is possible that during the current year a greater boost will be given to the interior customs that have been located in the state of Guanajuato. It is also expected that the Pacific Racer will have another interior customs office at a strategic point that could be located in Sonora or Sinaloa.
On the other hand, programs to promote agriculture, livestock, forestry and fisheries will have great activity to try to reverse the phenomenon of the recent devaluation, since there is a significant lag in food production that results in heavy imports.
The symptoms of devaluation have been felt by the decrease in imports of grains, meat and dairy products that are expected to be replaced in the short term with higher production volumes.
One aspect that has been stimulating the growth of the agricultural sector is that grain imports have been limited by the lack of letters of credit that are regularly used in grain exports from the United States.
Therefore, an important part of the 2009 budget should be applied in the import substitution promotion activities, while increasing the safety measures to ensure a greater flow of exports of fresh produce.
Conversion and diversification
With regard to conversion activities and support for diversification of production, the Procampo program will continue to encourage the cultivation of basic crops and Progan will assist in increasing the activities of honey, sheep and other minor species producers to reinforce Diversification.
In the areas of diversification, organic production will also be important in the areas of coffee, bananas, vegetables and dairy products, where there has been a significant growth in demand.
To generate a real increase in productivity and access to financing, SAGARPA will have a series of programs whose objective will be to support specific projects with guarantees, capitalization funds and investment table. In a similar way to what has been done in the services sector, the Agribusiness division of SAGARPA will create an investment table to support the production of bioenergetics, such as ethanol and biodiesel. It will also emphasize the financing of new crops – almonds, olive trees and organic products – and will support the production of tomatoes and green pepper and a greater diversification in the production of vegetables under the mesh – cucumber, squash, melon, aubergine and Peppers, among other crops.
During the current year we are likely to see the first greenhouse projects that use the waste from their crops to generate energy, composites and carbon dioxide. The private initiative will give priority to projects that are located near the thermoelectric plants to take advantage of natural gas generation and waste gas emissions to power heating systems.
It should be remembered that the support will be constituted with a mix of Federal and State resources, as well as a good response from financial institutions such as the Sofoles, which have been created to offer specific lines of credit to each project.
Due to the financial crisis, credit lines are likely to specialize in export portfolios whose amounts will depend on the ability of companies to pay. It is obvious that banks and credit institutions will try to ensure maximum operational efficiency and profitability.
Finally, the need to achieve greater efficiency and profitability, will generate partnerships and alliances between small producers and marketing companies. To this end, the Government will be able to provide solutions that allow the consolidation of the production of small companies through fair trade agreements. The goal of the Secretary of Agriculture in 2009 is to achieve greater production while improving input marketing systems – to support the integration of more efficient production chains.