Mexico’s Opportunities Rise Against the Odds

Posted by Jackie Pucci|18 June 2014

Gregory Polak is the third-generation CEO of Grupo Polak, a family-run agrochemical, pigment and equipment manufacturer founded 95 years ago in Mexico City. Key products of Polaquimia, the group’s agchem division, include 2,4-D acid, formulated herbicides, monochloroacetic acid, nonylphenols, ethoxylated and propoxylated products, among others. It also has a distribution center in Mexico City as well as warehouses and offices in Monterrey, Guadalajara, Leon and Puebla, among other cities in the country.

As a longtime insider, Polak shared his views on the country’s current market – both the good and the bad. “Mexico is becoming both a vegetable and fruit grower of the Americas, leaving grain production to the United States, Brazil, Canada and possibly Argentina,” Polak said. Though the country ranks third-largest in the agrochemical industry by invoice value, it has suffered setbacks due to decapitalization of the market, violence and a lack of technification. “GMOs are not used due to political reasons and Greenpeace influence and therefore, mostly generic products are consumed. We hope this will change, and the enormous gap between what is used and might be used in the future closes,” Polak told FCI. “There is great opportunity.”

New regulatory developments have shortened the waiting time for registrations. Thus far, the lack of discipline and misuse of the system has hampered the ability to offer a plentiful variety of products at an economical price. Margins are low, and financing s limited, he added. “So far this year we hope we might have a more than satisfying volume and harvest.”

As for fallout from China’s enforcement of environment laws, Polak said Mexico has felt the impact in terms of higher prices of agrochemicals, but the volume of supply has remained steady.

Other challenges here are the new tax reforms, which have undermined product usage – a trend Polak is hopeful will change. He summed up his perspective on doing business in Mexico: “All we want is that governments allow us to work and produce efficiently.”