Why doesn’t the price of the tortilla go down?

In addition to corn, the raw material for making tortillas, an essential food for Mexicans, there are other inputs that must be taken into account when determining their price, Marisol Huerta, a senior analyst at Grupo Financiero Ve por, told Expansión. Plus (BX+); and Fernando Cruz, partner of the Agricultural Market Consulting Group (GCMA).

On June 27, the price of a bushel of corn (the unit with which corn is sold in the United States) was $624.25, while in June 2022 the maximum price per bushel was $788.25.

In Mexico, a ton of grain in Sinaloa is around 5,300 pesos, while last year it cost about 7,000 pesos, said Fernando Cruz of the GCMA.

It is important to take into account that large companies make purchases of corn in advance -about four months-. “The lower prices are just beginning to be reflected,” said Huerta from BX+.

What influences the price of the tortilla?

The market is governed by supply and demand. However, in addition to this, there are other aspects that influence the price of the tortilla.

One of them that influences price formation is supply and competition. In CDMX, the State of Mexico and Puebla there are more tortilla shops. That helps the price not rise so much; while in the north of the country there are fewer and instead they consume more wheat flour tortillas.

“Since there are fewer tortilla shops, less is consumed and the price is higher,” said Cruz, a member of the GCMA.

Cities like Hermosillo (Sonora), Matamoros (Tamaulipas) and Piedras Negras (Coahuila), the tortilla reached 30 pesos per kilo; while in CDMX, Toluca, the State of Mexico and the metropolitan area of ​​Puebla the price was 20.19 and 15 pesos, respectively, according to the SNIM.