Maize supply to the storehouses

The network of suppliers shows 442 maize suppliers in México and the grain purchasing relationships are established with five types of suppliers, among which there are those that the storehouses consider principal. These suppliers are classified as: individual producers, groups of producers, national companies, international companies, and partners of the storehouse. These authors represent a network with a size of 447 nodes (Figure 1).

Source: authors’ elaboration based on ^{Borgatti (2002)} and ^{Borgatti et al. (2002)}.

Figure 1 Main maize suppliers to storehouses. 

The network density has a value of 0.50045; that is, the connections represent half of the ones possible, which is explained by an average out-degree of the storehouses of 2.5 actors mentioned.

The in-degree for each type of supplier is the principal analysis attribute in this network, since it defines their level of centrality, so that their dimension is shown in the size of each rhombus. Thus, we can notice that the most important type of supplier, which in the language of networks is defined as degree prestige due to its high level of centrality (^{Hanneman, 2001}), is individual producers, with an in-degree that means 78.3 % of the relationships.

The rest of the actors show very low in-degrees that mean 8.7 % for groups of producers, 7.0 % national companies, 5.3 % partners of the storehouse, and only 0.7 % international companies.

The fact that maize producers are the principal type of supplier for all types of storehouses shows, in principle, the importance of this type of actors in the maize supply to the market. However, since they are not organized or partners of the storehouses, that is, since they are not formed into a legal figure or as groups of producers, they are at a disadvantage, since it is possible even when prices are established in the Chicago stock market they will decrease as a result of the decisions that both intermediaries and large companies make (^{Castañeda et al., 2014}).

As ^{Modrego and Sanclemente (2007)} indicate, small-scale producers do not have any possibility of participating in the most dynamic and profitable segments of the network of commercialization, as long as their product does not comply with the conditions of cost, quality and innocuousness demanded by the markets through the central actors of the commercialization network.

This is even clearer among Type C and D storehouses, which lack infrastructure and are prevalent in the state of Chiapas, where practically all individual producers and groups of producers or partners of the storehouse simply do not appear as suppliers.

In contrast, among the storehouses supplied from the grain of partners there are types E and B. The first type of relationship is observed in the states of Puebla, Veracruz, Guerrero, Zacatecas, Durango and Nuevo León, where the producers are grouped and are constituted legally to store their harvests in a small space in terms of capacity and level of equipping.

The second type of relationship, of Type B Storehouses, whose grain enters from partners, is observed in storehouses such as: “Productores Unidos del Valle de Serdán”, in Puebla; “Sociedad Cooperativa de Productores de Maíz del Valle del Nazas”, in Durango; “Sociedad Cooperativa de Consumo Los Fresnillenses”, in Zacatecas; “Centro de Recepción Joaquín Miguel Gutiérrez”, in Chiapas; and “Procesadora de Semilla”, in Chihuahua. In these cases there are stronger organizations that have greater capacity for stocking and the possibility to give added value to the grain, given the level of equipping of the storehouses.

On the other hand, in the network it is observed that in the largest storehouses in terms of infrastructure, capacity and equipping (Type A), the main suppliers are producers and groups of producers, confirming the dependence that producers have on decision making by large companies, which have both the final decision in terms of the added value and the destination that is given to the grain stored. These storehouses are characteristic of the states of Sinaloa and Jalisco; some examples are: Almacenadora Mercader, Bachoco, Cargill and MINSA.

Now, the roster of enterprises mentioned as principal suppliers of the storehouses takes place more frequently in the states of Chiapas, Guerrero and Hidalgo, where companies such as Inagro del Sur, Granera Montes, Gramosa and Asgrow are supplied.

The distances at which each type of supplier is located and the time the maize stays stocked are aspects that allow complementing the network analysis when types of suppliers and storehouses are compared. Figure 2 shows that the largest in the country (Type A) and those in the Southeast, which although lacking infrastructure do store important amounts of grain (Type C), are stocked by suppliers that are located at short distances, regardless of the type of supplier. In the other groups of storehouses the national companies represent the farthest supplier, primarily in those of Type E.

Source: authors’ elaboration with information provided by Servicio Infomex.

Figure 2 Average distance between storehouses and principal suppliers. 

Observing now the average time of storage of the maize per type of supplier and of storehouse, it is found that precisely in those that are stocked at shorter distances it is where the grain remains stored for longer time (Type A and C). In the case of those of Type B and E, which, as has been seen before, are supplied primarily from national producers and companies, the distances from suppliers are similar, but the storage time is shorter in the smallest and less technified ones (Type E), which can be associated both to the level of equipping for grain management that each type of storehouse has and to the capacity of transformation and added value that those of Type B have, to a higher degree than those of Type E (Figure 3).

Source: authors’ elaboration with information provided by Servicio Infomex.

Figure 3 Average time of storage. 

Until now the network analysis of principal suppliers shows the dependence that storehouses have to be stocked by local producers; however, these also depend on the decisions of the companies since in their majority they are not legally grouped and constituted, thus leaving the productive process chain, the control of the price paid for maize, and the possibility of gaining access to government backing to larger storehouses or to the supplier companies.

If not only the suppliers mentioned as principal are observed now, but rather the total of maize suppliers for each type of storehouse, the weight of individual producers in grain supply to the storehouses is confirmed, since 72.8 % of the latter purchase grain from this type of social actors and the proportion is quite high, regardless of the type of storehouse.

In contrast, the groups of producers and international companies are more representative as suppliers of type A and B storehouses; national companies of type B and C storehouses; and partners of the storehouse of type B and E storehouses (Table 2).

Table 2 Storehouses that are stocked from each type of supplier. 

Source: authors’ elaboration with information provided by Servicio Infomex.

The amount of grain that storehouses acquire from each type of supplier makes the importance of individual producers in grain supply even more evident. In those of Type A, out of 9.5 million tons of purchases per year, 5.7 million come from individual producers; in those of Type B, 1.5 million out of 2.6 million; and in those of Type C, close to 110 thousand out of 170 thousand. In the case of those of Type D, virtually all the grain is acquired from individual producers and only in those of Type E the proportion of grain that is purchased from individual producers decreases due to the importance that the partners have as suppliers (Table 3).

Table 3 Total of maize acquired per type of supplier (tons/year). 

Source: authors’ elaboration with information provided by Servicio Infomex.

The second type of supplier in order of importance, both because of the proportion of storehouses that are stocked from them and because of the amount of grain it represents in the purchases of the storehouses are the groups of producers that, based on the number of relationships, are important primarily in Type A storehouses, although because of the amount of grain sold in each one, are relevant in all of them, except for those of Type D, where, as was mentioned before, only relationships with individual producers are established.

On the other hand, the national companies have greater importance as suppliers of Type B and C storehouses, and the international ones are significant only in those of Type A.

Principal buyers of the stored maize

Once the relationships that storehouses establish to purchase grain have been observed and discussed, the type of maize buyers that these refer as the principal ones, as well as the destinations of the grain stored for each type of storehouse, are analyzed.

First, the network of principal maize buyers from storehouses has a size of 442 nodes, where 436 are storehouses and six are types of buyers, grouped as: individuals, groups of producers, national and international companies, exports and partners of the storehouse. In this case, the storehouses have an average out-degree of 1.7 actors referred, which gives a network density with a value of 0.28937, and indicates that at the time of the grain sale the storehouses identify less principal actors than during their provision (Figure 4).

Source: authors’ elaboration based on ^{Borgatti (2002)} and ^{Borgatti et al. (2002)}.

Figure 4 Principal maize buyers from storehouses. 

In addition to less density, in this network a lower level of centralization stands out than in the type of suppliers, since it shows a structure shared between two types of actors which, due to the in-degree, can be considered degree prestige (^{Hanneman, 2001}); these are: individuals, with 33.6 % of the connections, and national companies, with 52.4 %. The rest of the actors have in-degrees that mean 6.1 % for groups of producers; 3.2 %, partners of the storehouse; and 2.4 %, both international companies and exports.

Observing in the network which are the buyers referred by type of storehouse we find that the national companies represent the only type of buyer in several storehouses of every type, but when it comes to a single type of buyer for Type E storehouses, individuals predominate (Table 4).

Table 4 Grain sales roster per type of storehouse and buyer. 

Source: authors’ elaboration with information provided by Servicio Infomex.

Likewise, in storehouses of Type A, B, C and D, the proportion of relationships established with buyers is mostly with national companies; the exception are those of Type E, which establish a higher proportion of relationships with individuals.

On the other hand, it stands out that the storehouses with lower levels of capacity and equipping (Type D and E) refer that they export grain; however, this explains why in every case these are located in Chiapas and sell the grain on the border between México and Guatemala.

Now, when the grain buyer is an international company, only the storehouses that are larger and technified (Type A) of the network are observed. This purchase-sale relationship is observed in the states of Jalisco and Sinaloa, where agricultural/livestock, trading and integrating groups sell to Cargill, Maseca or Grains & Ancillary.

The type of buyer that stands out for each type of storehouse allows suggesting that the storehouses with the lowest indicators of infrastructure, capacity and/ or equipping distribute small amounts according to their capacity for storage, so they represent the main distributors to tortilla makers, fodder and local and regional traders, as well as other storehouses with the capacity to transform the grain.

In their turn, the larger and more technified storehouses are the ones in charge of selling maize to national and international companies, with capacity to give added value to the grain, as well as to define the final destination in function of the variables of offer and demand in the market.

These data agree with the distance and the average transport time between storehouses and buyers. More than half of those of Type E, that is, the most frequent at the national level, but with less capacity for storage and levels of equipping, supply buyers that are located at quite short distances, of 17 km in average, whose grain destination is the dough and tortilla industry, that of balanced meals, or selling to other storehouses.

In contrast, 40 % of the largest and more technified storehouses (Type A) sell the grain to regional or interstate buyers, located at an average distance of 793 km. In this case, again these are storehouses located mostly in Sinaloa, and the buyers most often referred are GRUMA, in Nuevo León, Mexico City, Jalisco and Guanajuato; MINSA, in Estado de México and Jalisco; Molinos La Conchita, in Mexico City; and Mister Pollo, S.A. de C.V, in Jalisco (Figure 5).

Source: authors’ elaboration with information provided by Servicio Infomex.

Figure 5 Average distance between storehouses and principal buyers. 

In Type B storehouses, another situation is observed; a third part of the buyers is located at 39 km in average, although in contrast with storehouses of Type E the individuals do not stand out as buyers. In this case, they have as local buyers associations such as Grupo Sonqui, S.P.R. de R.L. in Sonora, and national companies like Nutrigafer S.A. de C.V. y Alimentos Concentrados de Delicias S.A. de C.V., in Chihuahua, and partners of the storehouse Productores Unidos del Valle de Serdán in Puebla.

Likewise, most of the buyers that are located at one to two hours distance from storehouses of Type B are national companies, among which all the grain for described here are found. Some examples are: in the dough and tortilla industry, Productores Maiceros del Valle de Edzna in Campeche, which sell to SUMASA in Yucatán; in the balanced meal industry, Sociedad Cooperativa de Productores de Maíz del Valle de Nazas in Durango, which sell to Ferrogranos, in Coahuila; in the oil industry, Almacenes de Zacatecas, which sell to Almidones Mexicanos in Jalisco; in the sale to another storehouse, Unión de Ejidos de Ahualulco de Mercado Jalisco, which sell to DICONSA in Nayarit. In addition, among states with larger territorial surface, like Chihuahua or Chiapas, the grain sale to partners of the storehouse is also located at one to two hours distance.

In their turn, those of Type C sell mostly to national companies that are located at distances further than two hours; primarily those of Chiapas are found in this case, which sell to GRUMA, located in Ocozautla de Espinoza, in the same state, whether for the dough and tortilla industry or for the flour industry; for this last destination all the storehouses are called Stocking Centers.

In those of Type D, which are also located primarily in Chiapas, but which stock in a more rustic way and lower amounts of grain, Grupo Agropecuario Plan de Ayala and Almacenadora Mercader S.A. de C.V stand out in addition to GRUMA, as well as several individuals mentioned on more than one occasion by different storehouses, in most of the cases, with the final destination of the dough and tortilla industry.

Destination industries of stored maize

Just like in the principal network of maize buyers, the network of destination industries is made up of 442 nodes, of which 436 are storehouses and six are the possible destinations for the grain: dough and tortilla industry, balanced meals industry, sale to another storehouse, flour industry, transformation in the storehouse itself and oil industry.

Because each buyer referred to by storehouses means a destination, the network density is also the same; what differ are the in-degrees. In this case, the main degree prestige is the dough and tortilla industry, which represents 49 % of the relationships referred to by storehouses; in the second place of importance, the industry of balanced meals, referred to in 25 % of the cases (Figure 6).

Source: authors’ elaboration based on ^{Borgatti (2002)} and ^{Borgatti et al. (2002)}.

Figure 6 Main destinations of the maize stored. 

In turn, the sale to other storehouses is also an important node, for it means 11.9 % of the relationships; the flour industry, which contemplates maize flour used to elaborate tortillas and other traditional foods, such as tamales, represents 7.4 %; the grain transformation inside the storehouse itself, 5.9 %; and the oil industry, 0.8 %.

Now, taking into consideration the destination industry and the type of buyer jointly, both in the dough and tortilla industry and in that of balanced meals, the main connections are between storehouses and individuals or national companies.

However, the Type A, B and C storehouses, which are the ones that have the best indicators of capacity and equipping, supply primarily national companies; and those of Type E are the main suppliers of grain for individuals, among which there are mainly tortilla makers.

It’s important to say that among national companies that purchase maize to destine it to the dough and tortilla industry, GRUMA concentrates 41 % of the mentions, whether with the name of MASECA or CONALSA. Others that stand out, although not with the same level of centralization, are: DICONSA (6 %), MINSA (5 %) and SIACOMEX (4 %).

In the flour industry the sale is centralized also in national companies and again GRUMA represents 41 % of those referred, whether with the name MASECA or CONALSA. Another 26 % corresponds to MINSA and 11 % to Almacenadora Mercader S.A. de C.V, highlighting that in this destination the Type E storehouses have low participation.

GRUMA’s strategy that ^{Chauvet and González (2001)} describe stands out, when they indicate that the leadership of this company is based on their vertical integration from maize stocking, its transformation into flour, the manufacture of machinery for the tortilla industry, tortilla production and the massive delivery up to the last detail.

However, when it comes to selling grain for the elaboration of balanced meals, although there are also individuals and national companies as principal buyers, there is lower level of centralization, both because of the type of social actor who appears in grain purchasing and because of the type of storehouse.

A degree prestige in this case is the Grupo Agropecuario Plan de Ayala, which represents 17 % of the mentions of national companies, but in every case they correspond solely to storehouses in the state of Chiapas. Other buyers who destine grain to the elaboration of balanced meals mentioned on several occasions are Cargill, Alimentos Balanceados Chihuahua, ALCODESA, Nutrigrafer, S.A. de C.V. and Mister Pollo, S.A. de C.V.

In the sale to another storehouse, the buyers are primarily national or international companies when the sale comes from the storehouses with better characteristics and to individuals when the grain comes from storehouses of Type D and E. Some of the buyers in this grain destination are Cargill, Diconsa, SIACOMEX and Agroproductores del Estado de Veracruz, S.A. de C.V.

Similarly, the oil industry as final destination of the grain is observed only when the buyers are national companies and the storehouses of Type A or B. In this case, half of the mentions correspond to the company Almidones Mexicanos.

Finally, when the destination of the maize is grain transformation inside the storehouse those of Type E sell mostly to individuals and those of Type B to national companies. Examples of these buyers are Unión Agrícola Regional de Productores de Maíz (UNIPRO), Bachoco, CPI Ingredientes, and Nuestro Campo S.C.