FE1124

https://doi.org/10.32473/edis-FE1124-2022

Protected Agriculture in Mexico1

Feng Wu, Zhengfei Guan, and Kuan-Ming Huang2

Mexico is the largest source of US fresh fruit and vegetable Protected agriculture is used mainly to produce high-value
imports (Huang et al. 2022). In 2019, over 50% of US crops. According to the Office of Mexico’s Secretary
agricultural imports from Mexico were fruit and vegetables of Agriculture, 17% of the specialty crops (in terms of
(USDA FAS 2021). Protected agriculture plays a critical role production value) are produced under protected structures
in the rapid growth of Mexican export agriculture, par- (SIAP 2020). Protected agriculture accounts for an even
ticularly the fruit and vegetable industry. This publication higher percentage in terms of agricultural export value. For
provides a comprehensive overview of protected agriculture example, the value of tomatoes produced under protected
in Mexico to help industry stakeholders and policymakers structures made up 61% of the total value of tomatoes
understand this fast-growing sector. exported to the US market in 2019 (SIAP 2020). As a result,
protected agriculture has been promoted by the Mexican
Protected agriculture is agricultural production utilizing government as a strategic project to improve the competi-
protective structures such as greenhouses and shade houses tiveness of Mexican agricultural products and economic
to protect crops from climatic and biological damages growth (Wu et al. 2018).
and improve growth conditions. The sector includes the
floriculture subsector producing for the domestic market Given the important role that Mexican protected agricul-
and the fruit and vegetable subsector producing mainly ture plays in the US fresh produce market, this publication
for export markets. Compared to open-field production, investigates the development of Mexican protected agri-
protected production has many advantages, including culture between 2009 and 2019, with a focus on protected
higher yield, better product quality, and improved access to production of fruit and vegetable crops. We first examine
the export market. Due to protected production technol- protected agriculture in terms of acreage, yield, and crop
ogy, the fruit and vegetable industry in Mexico has grown mix and then explore the driving force behind this growth,
rapidly with surging export of fresh produce in recent years. including the advantages of this technology, government
For example, about 78% of the vegetables produced under support, and international market demand.
protected agriculture are exported to the United States
and 5% are destined to Canada (Burfield 2019). In 2019,
Mexican exports of fruit and vegetables to the United States
Development of Protected
reached about 11 million metric tons, with a total value of Agriculture
$15.7 billion (fresh $13.4 billion and processed $2.3 billion), Protected agriculture started in Mexico in the 1990s.
almost two times that (both volume and value) in 2011 According to the Secretariat of Agriculture and Rural
(USDA NASS 2021; USDA FAS 2021). Development of Mexico, there were only 741 acres of
protected agriculture in 2000. When more and more

1. This document is FE1124, one of a series of the Food and Resource Economics Department, UF/IFAS Extension. Original publication date December
2022. Visit the EDIS website at https://edis.ifas.ufl.edu for the currently supported version of this publication.

2. Feng Wu, former assistant research scientist; Zhengfei Guan, associate professor, Food and Resource Economics; and Kuan-Ming Huang,
postdoctoral associate, Food and Resource Economics; UF/IFAS Gulf Coast Research and Education Center, Wimauma, Florida 33598.

The Institute of Food and Agricultural Sciences (IFAS) is an Equal Opportunity Institution authorized to provide research, educational information and other services
only to individuals and institutions that function with non-discrimination with respect to race, creed, color, religion, age, disability, sex, sexual orientation, marital status,
national origin, political opinions or affiliations. For more information on obtaining other UF/IFAS Extension publications, contact your county’s UF/IFAS Extension office.
U.S. Department of Agriculture, UF/IFAS Extension Service, University of Florida, IFAS, Florida A & M University Cooperative Extension Program, and Boards of County
Commissioners Cooperating. Andra Johnson, dean for UF/IFAS Extension.
producers recognized the benefits of protected agriculture Almost all protected structures in Mexico are used to
in yield, quality, pest control, and reduced risks associated produce horticultural crops. In 2019, 4,675 acres (3.5%)
with weather and climate variability, the growth of the of protected area were used to produce floricultural crops,
sector accelerated. Figure 1 shows the change of protected while 129,135 acres (96.5%) of protected area were used
agricultural area in Mexico from 2000 to 2019. The growth to produce fruit and vegetables. The leading fruit and
of protected agriculture started to take off in 2009 when vegetable crops produced under protected structures were
the Mexican government launched the Strategic Project tomato (40,846 acres), pepper (16,235 acres), strawberry
(National Strategy) for protected agriculture under the (15,385 acres), raspberry (14,902 acres), cucumber (11,231
2007–2012 National Development Plan. With an average acres), apple (11,013 acres), blueberry (7,211 acres),
annual growth of 7,004 acres per year, protected area had and eggplant (2,627 acres) (Table 1). Grapes, rose, and
increased to 133,808 acres by 2019. Although most states blackberries are the leading crops in the “other” category
in Mexico have protected agriculture, 57% of the area of in Table 1 and grew quickly in recent years. Figure 2 shows
protected agriculture is concentrated in three states: Sinaloa the distributions of protected area among major crops in
(20%), Jalisco (20%), and Michoacan (17%) (AMHPAC 2009 and 2019. In 2009, tomatoes had by far the largest
2017). percentage (65%)under protected structure, but over time,
this crop’s growth in acreage has slowed. Conversely, other
crops, in particular, berries, have seen fast growth after the
Mexican government pushed to double the sector’s produc-
tion capacity (Guan et al. 2015). By 2019, strawberries,
raspberries, and blueberries made up 28% of total protected
area in Mexico. Cucumber acreage under protected produc-
tion saw a seven-fold growth during 2009–2019 (Table 1).

Figure 1. Protected agricultural area (acre) in Mexico, 2000–2019.

Credits: Agrifood and Fisheries Information Service, Mexico; Servicio Figure 2. Distribution of protected area among crops in 2009 and
de Información Agroalimentaria y Pesquera (SIAP), 2020 2019.
Credits: Agrifood and Fisheries Information Service, Mexico; Servicio
Protection structures in Mexican agriculture include three de Información Agroalimentaria y Pesquera (SIAP), 2020
major types: high-tech greenhouses, low-tech micro and
macro tunnels with plastic covers resting on semi-rigid
Factors Driving the Growth
supports (called plastic tunnels or macro tunnels), and As can be seen from Figure 1 and Table 1, protected
open-sided shade houses that protect plants using perme- agriculture has grown rapidly in Mexico since 2009. Several
able covers. Among these structures, shade houses are the factors have contributed to the rapid growth of the sector.
least expensive and often the first step in the adoption of First, the significant advantages of protected production
protected production for most open-field growers. The over open-field production have made it an attractive
popular types of protection structures are different across technology for adoption. Second, the adoption is embraced
geographic regions, farm sizes, and crops. Growers in by the Mexican government, which has provided generous
central states such as Queretaro and the State of Mexico support to facilitate the investment and accelerate the
have widely adopted greenhouse technology due to lower adoption. Third, strong demand from the North American
temperatures, while growers in Sinaloa prefer shade houses market has sustained continued expansion of protected
because of their warmer weather. Typically, most large production in Mexico.
farms (more than 15 ha) use better technologies compared
to smaller farms, as large farms have more access to capital. Benefits of Protected Agriculture
In 2019, three types of cover structures—greenhouses, Compared to open-field production, protected production
plastic tunnels, and shade houses—accounted for 26%, 28%, brings significant benefits, including increased yield and
and 46%, respectively, of total protected production area. quality, higher prices, reduced vulnerability to environ-
mental factors, increased water and chemical use efficiency,

Protected Agriculture in Mexico 2

extended production windows, and, in some locations, For comparison, the average wage rate paid to hired field
year-round production and supply that is important to workers in the United States was $14.11 per hour in 2019
many clients. These advantages coupled with subsidies (USDA NASS 2021). A survey study further showed that
(to be discussed shortly) translate to higher profitability the average labor cost for Mexican strawberries exported to
and better market access,which has attracted producers to the United States was $1.27 (18.27 pesos) per flat compared
switch from open field production to protected production. to $2.81 per flat for Florida strawberries (Wu, Guan, and
Garcia-Nazariega 2018). Also, the continued devaluation
Figure 3 compares crop yield across different cultivation of the Mexican peso over the years has given Mexican
types in Mexico. Productivity under protection structures produce an extra edge in competitiveness compared to
is much higher than that in open field. Furthermore, US-grown produce (Congressional Research Service 2020).
productivity gains increase significantly as the level of Since 2011, the Mexican peso has lost 45% of its value
technology rises. Take tomatoes and cucumber as examples. measured in US dollars (USD) (OECD 2021). Although
In 2019, tomato yields under macro tunnels, shade houses, low labor costs and peso devaluation are general factors
and greenhouses were 79,163, 100,013, and 162,600 pounds not directly tied to protected agriculture, they do magnify
per acre, respectively, which are over two, three, and five the competitive advantage of the Mexican produce grown
times the average open-field yield in Mexico, respectively. under protected agriculture against the US produce in the
Similarly, cucumber yields under these three structures fruit and vegetable market.
were 44,136, 84,311, and 109,640 pounds per acre, respec-
tively, while open-field yield was only 26,712 pounds per
acre (Figure 3).

Figure 4. Farm-level prices for crops produced with different types of

cultivation in 2019.
Credits: Agrifood and Fisheries Information Service, Mexico; Servicio
de Información Agroalimentaria y Pesquera (SIAP), 2020
Figure 3. Crop yields across different cultivation types in 2019.
Credits: Agrifood and Fisheries Information Service, Mexico; Servicio
de Información Agroalimentaria y Pesquera (SIAP), 2020
Generous Government Support
One obstacle for the adoption of protected agriculture is
In addition, producers receive higher prices for products
the high initial investment requirement. For producers in
under protected production. Figure 4 shows farm-level
developing countries, capital usually is a major constraint
prices of tomatoes, strawberries, bell peppers, and cucum-
that would limit the development of protected agriculture.
ber produced under different technologies. Those produced
In Mexico, the government has been subsidizing protected
in greenhouses bring the highest prices, except for toma-
agriculture, providing producers with much-needed capital,
toes. Prices for bell peppers, strawberries, and cucumber
which reduces producers’ cost of production and their
produced under protected structures are approximately one
capital constraints in investment, thus driving technology
and a half times the prices of those produced in open fields
adoption and industry expansion (Wu et al. 2018).
due to higher quality. Furthermore, protected structures
can extend the production season to wintertime when crop The government support in protected agriculture was part
prices are usually higher. Increased yields and prices help of the strategic project under the National Development
secure higher revenues for producers. Plan, which established programs to increase the produc-
tion capacity and competitiveness of Mexican agricultural
There are other factors that increase the competitiveness
products. The details of the major support programs have
of exported Mexican produce. In 2019, the average wage
been studied in the literature (Wu et al. 2018; Wu, Soto-
rate of farmworkers in Mexico was 225.57 pesos per day
Caro, and Guan 2021). One of the government programs
(for a 10-hour workday), equivalent to $1.2 per hour.

Protected Agriculture in Mexico 3

provides support for the equipment and infrastructure market tomatoes. The US production in Figure 6 represents
of protected agriculture and related services, including open-field production that was utilized; a small percentage
training and technical assistance. The subsidy rates depend of unsold production is not included. In recent years, pro-
on the technologies used and vary across the years, with tected agriculture tomatoes are gaining popularity in the US
total subsidy amounts up to 50% of the project costs. The retail food industry. For example, Wendy’s (a US fast-food
maximum subsidy amount per project in 2013 was 1.5 mil- service) has announced that it will be sourcing only green-
lion pesos ($113,000) for macro-tunnels, 2.4 million pesos house-grown tomatoes, which are mostly from Mexico, at
($181,000) for shade houses, and 3 million pesos ($226,000) all of its US and Canadian fast-food locations. Tomatoes are
for greenhouses (Table 2). In 2019, the maximum amount the leading US vegetable import from Mexico, accounting
increased to 4 million pesos per project ($208,000, based on for 85.5% of the value of total US tomato imports and 91%
the 2019 exchange rate) for all types of eligible structures. of imported tomato volume in 2019. Among the imported
The support for protected structures totaled 2.35 billion Mexican tomatoes, 61% of the value of imports and 50.5
million pesos ($150 million) during 2013–2018 under the % of volume are sourced from protected culture structures
previous National Development Plan (Table 3). The total in 2019, compared to 44% and 34% in 2009, respectively.
estimate of subsidies for protected production in Mexico This shows the significant role protected agriculture has
over the period 2001–2018 was approximately 7 billion played in the rising imports of Mexican tomatoes in the
pesos ($550 million) (Garcia Victoria et al. 2011; Wu et US market. Furthermore, competitive pricing, product
al. 2018). The strategic government support for protected features, year-round supply of products, and government
agriculture has been a driving force behind the industry’s promotion have all contributed to the growing market share
rapid growth, accelerating the adoption of protected of Mexican produce in the international market.
agricultural structures.

Strong International Demand and Growth

in Exports
The strong demand for Mexican fruit and vegetables is also
essential to Mexico’s protected agriculture. Mexico has been
the largest source of US fruit and vegetable imports since
1967 (the earliest year data were available in the USDA FAS
database) (USDA FAS 2021). According to the US Depart-
ment of Commerce, fresh fruit and vegetables have been the
leading categories in imported agricultural products from
Mexico since 1967. In 2019, US imports of fresh fruit and
vegetables from Mexico were $13.4 billion, representing Figure 5. US fruit and vegetable imports from Mexico, 2009–2019.
48% of the 2019 US total agricultural imports from Mexico Credits: USDA Foreign Agricultural Service (USDA FAS), 2021
($28 billion). Besides fresh produce, the United States also
imported large amounts of processed fruit and vegetables.
Figure 5 shows the growth in US fruit and vegetable
imports (fresh and processed) from Mexico from 2009 to
2019. During this period, the value of US imports of fruits
and preparations from Mexico more than tripled while
imports of vegetables and preparations more than doubled.
In 2019, total imports of fruit and vegetables (including
preparations) from Mexico reached $15.7 billion (Figure
5), representing 56% of the total agricultural imports from
Mexico.

It is worth noting that the increased imports from

Mexico in the US market corresponded to declines in the Figure 6. Fresh market tomatoes: US production versus imports from
production of the same crops in the US fruit and vegetable Mexico, 2000–2019.
industry. Figure 6 provides an example of increasing Credits: USDA Foreign Agricultural Service (USDA FAS) and USDA
National Agricultural Statistics Service (USDA NASS), 2021
Mexican imports and declining US production of fresh

Protected Agriculture in Mexico 4

The declining trend of US fruit and vegetable production market have caused tensions and a series of trade disputes
is especially significant in the southeastern states where between the two countries involving multiple crops.
growing seasons of major crops overlap with those in
Mexico. For instance, Florida, the major strawberry and
fresh tomato supplier in the US market in wintertime,
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Protected Agriculture in Mexico 5

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Protected Agriculture in Mexico 6

Table 1. Area (acres) of major crops under protected structures in Mexico, 2009–2019.
Year 2009 2012 2016 2019
Tomato 8,743 35,388 37,135 40,846
Pepper 1,611 9,998 11,841 16,235
Strawberry 0 348 12,699 15,385
Raspberry 0 0 12,926 14,903
Cucumber 1,614 7,450 11,372 11,231
Apple 0 0 798 11,013
Blueberry 0 0 4,636 7,211
Eggplant 0 2,686 1,636 2,627
Others 1,537 329 2,884 14,357
Total 13,504 56,199 95,926 133,807
Source: Agrifood and Fisheries Information Service, Mexico; Servicio de Información Agroalimentaria y Pesquera (SIAP), 2020.

Table 2. Support rules for intensive production and agricultural covers (IPAC) subprogram, 2013–2019.
Intensive Maximum Amount (in 1,000 pesos/project)
Production 2013 2014 2015 2016 2017 2018 2019
Macro-tunnels 1,500 2,700 2,700 2,700 2,700 2,700 4,000
Shade houses 2,400 2,700 2,700 2,700 2,700 2,700 4,000
Anti-hail mesh -- 700 1,000 1,000 1,000 2,700 4,000
Greenhouses 3,000 2,700 2,700 2,700 2,700 2,700 4,000
Source: Ministry of Agriculture, Mexico, 2013–2019.

Table 3. Expenditures of intensive production and agricultural covers (IPAC) subprogram, 2013–2018.
Year Support Amount (in 1,000 pesos) Support Amount (in $1,000 USD)
2013 504,593 39,539
2014 441,470 33,179
2015 281,482 17,824
2016 504,551 27,004
2017 268,362 14,190
2018 350,278 18,217
Total 2,350,736 149,953
Source: Agrifood and Fisheries Information Service, Mexico; Servicio de Información Agroalimentaria y Pesquera (SIAP), 2020.

Protected Agriculture in Mexico 7