Two stories out of Mexico today that seem to indicate just how the US will be dealing with our neighbor to the South in the coming years. The first one deals with their oil company PEMEX and the second, deals with the purchasing power of Mexican-Americans in the US.
Mexico Third in World Oil Production
Petroleos Mexicanos (PEMEX) oil company is now third in world crude production as it reached 3.7 million barrels per day (mbd) this year.
The Mexican entity slightly surpassed its own average in 2005, identifying it as a leader in the energy sector, according to a bulletin edited by the PEMEX Social Communication and Information Management.
Ahead of PEMEX are the Saudi ARAMCO and National Iranian Oil (NIOC) of Iran, occupying the first and second places, respectively. The 2006 Statistical Yearbook of PEMEX recognizes Venezuelan state-run PDVSA in fourth place, followed by Exxon Mobil of the US, the British BP, Kuwait´s KPC and the consortium Royal Dutch Shell of Dutch and British capitals.
The list of the first ten is completed by PetroChina and INOC of Iraq. As for the output per country, Mexico holds the sixth place, ahead of Norway, the United Arab Emirates, Kuwait, Nigeria, Canada and Venezuela.
The first place is held by Saudi Arabia with a volume beyond the 9.3 million barrels per day, followed by Russia, which also goes beyond the nine million mark, the United States with 5.1 million, Iran and China, with almost 4.0 million barrels per day each.
As for total sales, PEMEX went up from eighth to seventh place worldwide, boasting revenues of over 86 billion dollars in 2005.
The PEMEX yearbook also indicates that referring to primary destilation of hydrocarbons, the Mexican company was 12th in world ranking with an average of 1.5 million barrels per day.
As for proven crude reserves, Mexico holds the 14th place with around 15 billion barrels, while Saudi Arabia is first with over 264 billion barrels. The source estimates Mexico has 54 billion barrels of oil equivalent yet to be discovered, of which around 60 per cent is thought to lie in deep waters and the rest in land or shallow waters.
Latin American firms eye U.S. market
Three weeks out of every month, Luis Almeida sits in his office in Cicero, Ill., thousands of miles away from his family in Mexico City. The businessman suffers through his absence from them — and puts up with the state's famous bone-chilling winters and humid summers — for one reason. Actually, for billions of reasons: the dollars spent each year by Hispanics in the United States.
"The market is very big," said Almeida, whose firm sells Mexican food products to Hispanic grocers in the Midwest. "Consumption of the 40 million Hispanics in the U.S. is the same as the gross national product of Mexico, and Mexico has 110 million people."
Hispanics in the United States are expected to spend nearly $800 billion this year, according to a study released last month by the Selig Center for Economic Growth at the University of Georgia. By next year, their economic power should top $863 billion — outpacing blacks as the biggest spending minority group in the country, according to the study.
Mexico's gross domestic product is estimated at $811 billion this year, according to the
International Monetary Fund.
Almeida's company, Super Bodega Dona Lupe Inc., is one of more than 100 foreign businesses — mostly from Mexico — represented at the annual convention of the U.S. Hispanic Chamber of Commerce, held this week in Philadelphia. That is the highest number of foreign firms ever to participate in the convention, a chamber spokesman said.
Super Bodega Dona Lupe, which has an office and warehouse in Illinois, caters to Hispanics in Illinois, Wisconsin, Indiana, Michigan and Minnesota. Almeida calls these states "emerging markets," with a fast-growing Hispanic population migrating from traditionally Latino-heavy states such as California, New York, Arizona, Texas and New Mexico.
While big companies in Mexico hawking brand name products already sell into the U.S. market, Almeida is an example of the smaller entrepreneurs seeking a niche in the Hispanic market. He started his business nearly four years ago, but sales of his Campo Mio, or "My Field," brand really got going last year. He ships 15 containers a month from Mexico to Laredo, Texas, and on to Chicago by rail.
Part of the delay in launching his products has been making sure the goods meet U.S. standards. Labels have to contain nutritional information and manufacturers have to meet U.S. quality standards.
One of his products, a Mexican gelatin, uses only food coloring approved by the Food and Drug Administration. In Mexico, he said, manufacturers use any type of food coloring — and usually opt for cheaper ones.
Almeida also has to compete with U.S. companies catering to Hispanic tastes. For example, he wanted to bring in salsa, but many U.S. companies already make it. So Almeida decided to bottle a kind of salsa that looks like chili paste, but with more oil in it. People can smear it on eggs or tortillas, he said.
Almeida also tries to make his products quick-cooking, since many Hispanics have adapted to the convenience cooking lifestyle prevalent in America.
"Although they are originally from Mexico, they are no longer Mexican in the way they are living and in their consumption," he said.
People are seen at the registration tables for the U.S. Hispanic Chamber of Commerce' annual Convention & Business Expo at the Pennsylvania Convention Center in Philadelphia, Wednesday, Sept. 20, 2006. The convention has attracted over 100 foreign firms who want to market to Hispanics in the U.S. due to their estimated buying power of nearly $800 billion this year.
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