Falling agave prices leave fields abandoned and infested in Mexico, say tequila producers

The agave sector in Mexico, crucial for tequila production, is facing significant challenges due to overproduction and a sharp decline in prices over the past five years. This situation has resulted in the abandonment of agave fields and a subsequent proliferation of pests across the five states that comprise the tequila's designated origin zone.

Aurelio Rocha, president of the Consejo Regulador del Tequila (CRT), stated that "There are agave fields that are abandoned because the price is not believed to be convenient; they are left to become infested, and the pests do not recognize borders, they can migrate from one agave field or one producer to another." During the commemoration of National and International Tequila Day, Rocha emphasized that a precise census of abandoned agave fields is not yet available, but the Council plans to allocate resources to enhance surveillance, inspection, and containment efforts.

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There are agave fields that are abandoned because the price is not believed to be convenient; they are left to become infested, and the pests do not recognize borders, they can migrate from one agave field or one producer to another.

The CRT reports that within the 181 municipalities of the designated origin area, there are over 511,000 hectares planted with more than 1.7 billion agave plants. Overproduction since 2024 has caused a dramatic drop in the price per kilogram, with prices ranging from 0.80 to 8 pesos (approximately $0.046 to $0.46) for producers registered in the CRT's Agave Responsable Social (ARS) program as of March this year.

While this price drop did not directly impact tequila production, it significantly affected approximately 5,900 farmers. Rocha noted that the imbalance between the demand for agave and its production is substantial, estimated at a ratio of at least 3.5 to 1. "What does this mean? Well, agave suffers, like any product, from the differences in supply and demand. What needs to be done is to increase demand by selling more tequila and to better control the supply of agave, not immediately, but in the medium and long term," he explained. He also mentioned that the ARS registration, which verifies good practices and traceability, has helped somewhat in controlling overproduction, but admits it's difficult to manage completely as anyone can plant agave at any time.

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What does this mean? Well, agave suffers, like any product, from the differences in supply and demand. What needs to be done is to increase demand by selling more tequila and to better control the supply of agave, not immediately, but in the medium and long term.