The Agro-Industrial Sugarcane System in Mexico : Current Status , Challenges and Opportunities

Sugarcane cultivation in Mexico occurs under a wide range of socioeconomic, environmental and agricultural conditions, with the last three harvests (2010/2011, 2011/2012 and 2012/2013) providing yields ranging from 36-125 t ha (variation > 347%), with an average yield of 70.2 t ha, which is below the world average of 80 t ha. The total area allocated to sugarcane production in Mexico is close to 800 thousand hectares, and could rise to nearly 5 million hectares given adequate conditions for its cultivation. This activity generates approximately 1 million direct jobs, 2.2 million indirect jobs, and more than 2.5 billion dollars (0.4% of GDP) per year. Climate change and the rapid market penetration of high fructose corn syrup are among the greatest threats to this agribusiness, including severe disintegration of production processes in the field, industry, commerce, and consumption of cane sugar. Technology lags, low investment, high processing costs and shortcomings in production sales are issues the industry must address by leveraging their resources and coordinating processing links to be more efficient and competitive. Political influence has imposed a suboptimal policy framework to achieve the projected potential. To overcome current lags in the field and refineries within the country, significant innovations across the value-chain are underway, including a robust breeding program, digitalization of sugarcane fields and novel investments in research and development. The sugarcane value-chain has great potential for Mexico, and exploiting this potential is possible if technological, organizational and commercial management innovations currently in progress in fields and factories are applied.


Introduction
Sugarcane (Saccharum spp.) is the most productive crop in the world due to its higher efficiency in photosynthetic capacity, and its ability to store sucrose in its stem.Sugarcane contributes 75% of the total sugar produced in the world with the remaining 25% produced from sugar-beets (Beta vulgaris L.).Its high biomass production and ease of growth make sugarcane one of the most interesting agricultural commodities globally, useful not only in food and feed, but also in the generation of inputs for bioenergy and chemical industries.Its cultivation covers an area over 25.4 million hectares in more than 130 countries and territories, with production of more than 1800 million tons, thus establishing sugarcane as the crop having the most acreage in the world (FAOSTAT, 2013).Average global production is approximately 80 t ha -1 (Waclawovsky, Sato, Lembke, Moore, & Souza, 2010), although theoretical yields are estimated near 470 t ha -1 dry matter or 805 t ha -1 of fresh cane per year (Yadav, Jain, & Rai, 2010;Dal-Bianco et al., 2012), which supports the hypothesis that increased future yields are possible.Diversification of products (transition from simple sugarcane mills to sugarcane biorefineries) utilizing the entire crop for a variety of environmentally friendly outcomes apart from sucrose, is the key factor in today's highly integrated sugar milling operations, generating a wide range of other products such as energy, human food, animal feed, manures, biofuels, ethyl alcohol and its derivatives.In fact, it is possible to derive more than 10 000 new products from sucrose (Aguilar-Rivera, Rodríguez-Lagunes, & Castillo-Morán, 2010).For small peasant farms, a profitable alternative is natural brown sugar, for which production in Mexico fluctuates between 100 000 and 500 000 t year -1 (Méndez, Elorza, Maruri, Elorza, & Martínez, 2013).This enormous performance capability for a sugarcane multipurpose culture is highly important for its continued use, including its bio-factory potential for the synthesis of high-value sugars, biopolymers and pharmacological proteins (Gómez-Merino, Trejo-Téllez, & Sentíes-Herrera, 2014).
In Mexico, sugarcane agribusiness generates more than 930 000 direct jobs and 2.2 million indirect jobs, in 15 states and 227 municipalities (9.2% of all municipalities in Mexico) (Secretaría de Economía, 2012) that are grouped into six production areas (Northwest, Pacific, Center, Northeast, Gulf and South) (Aguilar- Rivera, Rodríguez, Enríquez, Castillo, & Herrera, 2012).In this value-chain, enormous strengths are related to soil quality and suitable climate where it is grown, and where the primary producer organizations and industry are well-structured, although complex.However, there are major challenges that need to be addressed to ensure a successful future for this value-chain.Recently, Aguilar-Rivera, Espinosa-López, Herrera, Castillo, and Lagunes (2013) performed an analysis of competitiveness of the Mexican sugarcane industry, taking into account Porter´s diamond model (Porter, 2008).Within this analysis, actor conditions; demand conditions; firm strategy, structure and rivalry; related and supporting industries; as well as role of the government and changes in the Mexican sugarcane value-chain are depicted.Herein, we further analyze more in-depth the state of the art for the sugarcane production system in Mexico, and describe its strengths and current and future challenges to ensure its consolidation through innovative strategies that may increase productivity and profitability.

History and Current Economic Importance of Sugarcane in Mexico
Since its introduction in Mexico nearly 500 years ago, sugarcane has become an integral part of the national economy.Although its development has gone through serious critical stages since its inception, it is now established as one of the most traditional agribusiness activities of significance in the country's economic development (Aguilar-Rivera, 2013), which now faces significant consolidation challenges to remain as an innovative and globally competitive value-chain.
The Mexican sugar industry has a historical-structural model depicting the operation of a traditional and rooted socioeconomic system after the triumph of the Mexican Revolution.This model is characterized by a supply of goods with low added value and low technology, coupled with a demand for high-technology goods and commercial value.This generates a trade deficit and an unfavorable environment for future sustainability.
The generation of Mexican varieties of sugarcane began in 1930, peaked in the 1970s, and in 1990 began to decline (Flores, 2001).Efforts coordinated by the National Chamber for the Sugar and Alcohol Industries (Cámara Nacional de las Industrias Azucarera y Alcoholera, CNIAA), the Center for Research and Development of Sugarcane (Centro de Investigación y Desarrollo de la Caña de Azúcar, CIDCA), the Secretariat for Agriculture, Livestock, Rural Development, Fisheries and Food (Secretaría de Agricultura, Ganadería, Desarrollo Rural, Pesca y Alimentación, SAGARPA), the National Committee for the Sustainable Development of Sugarcane (Comité Nacional para el Desarrollo Sustentable de la Caña de Azúcar, CONADESUCA) and the sugarcane organizations National Confederation of Rural Holders (Confederación Nacional de Propietarios Rurales, CNPR) and the National Confederation of Farmers (Confederación Nacional Campesina, CNC), have maintained the agribusiness and are fundamental players for the increases observed to date.
Mexico is currently the sixth largest producer of sugar and sugarcane (FAOSTAT, 2013;ZAFRANET, 2013) which is not purely for export and the activity is based on domestic consumption (Aguilar-Rivera, 2012).The 2012/2013 harvest was conducted over an area of approximately 780 000 ha with 55 refineries in operation, and a production of 61.5 million tons of cane and a total of 6.7 million tons of sugar (CNPR, 2013;CONADESUCA, 2013).Apparent domestic consumption is more than 5 million tons of sugar per year with an annual per capita consumption of 47 kg (Aguilar-Rivera, 2012).Today, this agribusiness has an economic impact of approximately 2 591 million dollars, economically and socially impacting over 3 million Mexicans (Secretaría de Economía, 2012).In 2011, Mexico contributed 3% of the global sugarcane production (FAOSTAT, 2013).
In Mexico, the cultivation of sugarcane is concentrated in six regions (Figure 1): Northwest (state of Sinaloa), Pacific (states of Nayarit, Jalisco, Michoacán and Colima), Center (states of Puebla and Morelos), Northeast (states of Tamaulipas and San Luis Potosí), Gulf (states of Veracruz, Oaxaca and Tabasco) and South (states of Chiapas, Campeche and Quintana Roo) (CONADESUCA, 2013).The average yield of sugarcane was 66.10 t ha -1 for the 2010/2011 harvest, 65.87 t ha -1 for the 2011/2012 harvest and 78.74 t ha -1 for the 2012/2013 harvest,  Municipalities without sugarcane production are smaller than those producing sugarcane, with 80% of their populations living in towns with fewer than 5000 inhabitants, 60.7% of the inhabitants receiving less than two minimum wages and 23.8% without basic education (Secretaría de Economía, 2012), which puts them at a disadvantage.The more than 220 municipalities where sugarcane is produced are home to more than 12 million people, and their average contribution to national added value is 7.1% (INEGI, 2012;CONAPO, 2010a).
The diversification of the sugarcane agribusiness has been suggested as a strategy to increase profitability.However, according to Aguilar-Rivera (2012), such diversification could affect the supply of sugar and its market price due to competition for raw material (sugarcane) through simple fluctuation in supply and demand.Due to conflicts of interest, lack of strategic planning, dialogue, and consultation between the groups involved, diversification of this agribusiness has been only in political discourse.As such, alcohol production, for example, has fallen by roughly 80%, from 67 thousand liters of ethanol to only 14 thousand in the last decade, with only three refineries operating distilleries since 2010 (Secretaría de Economía, 2012).
Rather than relying on efficient and sustainable use of resources for production, sugarcane field dynamics respond to increases in harvested area, with a slight tendency for increases in yields.This behavior is a consequence of an unfavorable ratio between primary producers and the industry, as well as excessive government regulation that discourages competitiveness in the fields and factories.In addition, imports of high fructose corn syrup (HFCS) and other non-caloric sweeteners produced by high technology compete and displace domestic sugar production (Aguilar- Rivera et al., 2012;Secretaría de Economía, 2012).Indeed, in 2013, Mexico imported nearly 1300 thousand tons of HFCS from the USA (USDA, 2014), and the domestic market for this sweetener increases annually.In a recent study, Goran, Ulijaszek, and Ventura (2013) reported that countries with higher availability of HFCS have higher prevalence of type 2 diabetes.As in Mexico, there is a high prevalence of diabetes (14%), which is the leading cause of death in women and second in men (Sosa-Rubí, Galárraga, & López-Ridaura, 2009); HFCS poses a serious public health problem that must be properly managed.
Another socioeconomic factor determining the behavior of the system is land tenure.Of the total acreage devoted to this crop, 76.3% occurs in areas of 5 ha or less in suburbs and rural communities, while 18.8% is distributed in areas between 5.1 and 10 ha, and only 4.9% occurs in areas larger than 10 ha (Secretaría de Economía, 2012;INEGI, 2012).According to Pérez-Zamorano (2007) and Singelmann (2003), sugarcane small-holders and common lands, locally known as ejidos, and other socio-political phenomena in the field act as brakes on the sugar industry, separating land and capital, the two most important factors in terms of production agriculture and social welfare.Strategies such as digitizing sugarcane fields to improve agricultural precision have been undertaken by SAGARPA under the National Program for the Sugarcane Agroindustry (Programa Nacional de la Agroindustria de la Caña de Azúcar, PRONAC) and have provided important technological tools, but a joint effort to comprehensively address the multifaceted problems affecting this value-chain is still required, particularly in terms of land tenure and small-holders.

Environmental Factors
In Mexico, sugarcane production systems are located along the coasts of the Pacific Ocean and the Gulf of Mexico, in valleys of the Altiplano (high plateau), to southern Quintana Roo, where climates are varied.Historical records show 90% of the minimum monthly temperatures in sugarcane areas range from 10°C to 20°C from November to March.In contrast, the average monthly maximum temperature lies between 20°C and 30°C from December to February, increasing to more than 30°C between April and September (COLPOS, 2008;CONADESUDA, 2012).
Regarding irrigation, production is distributed with 62% in rainfed areas and the remaining 38% in irrigated areas (CONADESUCA, 2011a), with the average water consumption varying from 5.48 to 6.84 mm per day, which equates to 2000-2500 mm of rainfall per year.According to Moyer (2010), Mexico is the second-most vulnerable country to the effects of global climate change, with agricultural production possibly decreasing by more than 25% by 2080 if the country does not develop efficient strategies to adapt to this phenomenon.Growth in irrigation infrastructure is therefore critical to the success of this activity, as sugarcane cultivation is one of the most demanding for water and fertilizer.Advances in biotechnology, nanotechnology and precision agriculture are also required and Mexican institutions are making good progress in this regard.
Land for sugarcane production in Mexico has physical and chemical characteristics generally suitable for cultivation (COLPOS, 2008).Soils in cultivated areas are mainly classified as eutric fluvisol, vertisol eutric, cambisol endogleyic, eutric and chromic rendzic, and luvisol leptosol gleyic (Palma-López, 2009).The variation of some physical and chemical soil indicators are shown in Appendix A Table S1, which have direct or indirect relationships with the water catchment areas (rain and water storage capacity of the soil) (COLPOS, 2008).
Approximately 70% of the soils in sugarcane cultivation areas have nitrogen concentrations between 10 and 20 kg ha -1 , thus requiring the application of nitrogen fertilizers, 27.2% have phosphorous concentrations above 30 kg ha -1 , and 74% show potassium content higher than 160 kg ha -1 .Most of the soils dedicated to sugarcane cultivation (68.3%) show calcium levels between 2500 and 10 000 kg ha -1 , whereas magnesium ranges from 500 to over 1000 kg ha -1 on 65% of sugarcane land (detailed information in Appendix A Table S2) (COLPOS, 2008).Concentrations of the micro-nutrients Fe and Mn are high in most cases, even in areas with alkaline and calcareous conditions.Copper concentrations are mostly between 0.5 and 3 mg kg -1 of soil, while zinc is most often found in concentrations below 1 mg kg -1 of soil (COLPOS, 2008) (detailed information in Appendix A Table S3).
The general climate and soil characteristics in sugarcane producing areas indicate that conditions are favorable for crop development, and permit the identification of advantages and limitations (see Appendix A Table S4 for details).These data are crucial for making predictions about development, adaptability and crop production, as well as looking for new farmland.A projection for the areas with the greatest potential for expansion of sugarcane cultivation in Mexico shows that the current area devoted to this crop could grow to 5 million ha (with approximately 500 thousand ha showing high potential and 4.5 million ha with average potential) (SAGARPA, 2009).

Agronomic Factors
The National Program for High Sugarcane Profitability (Programa Nacional para la Alta Rentabilidad de la Caña de Azúcar, PRONAR, 2009) estimates that the low average productivity obtained over the last decade is due to a scarce use of emerging technology for water and soil analysis, as well as an inefficient soil management program, the lack of an effective national program for the generation and use of new varieties (efforts are made independently by each refinery), the absence of certified seed production systems, no national program coordinating the management and control of diseases, pests and weeds, and harvest management without quality controls.In addition, sugarcane in Mexico is grown in seven-year cycles, and the area planted is composed of 13% new plantings (1.5 years in age), 15% ratoons called soca (second crop from the same planting at 2.5 years old) and 72% of the ratoons known as resoca (third crop from the first planting, > 2.5 years of age) (Aguilar- Rivera et al., 2012), implying lower productivity for older plantations.Faced with this problem, the objective of PRONAR ( 2009) is to increase the profitability and competitiveness of Mexican sugarcane fields using the following ten steps: 1. Empowerment of farmers and smallholders; 2. Diagnoses limiting factors (water and soil); 3. Systematize tillage and soil preparation; 4. Schedule date and densities for seeding; 5. Select adequate seeds and varieties; 6. Apply balanced fertilization; 7. Manage water and wastewater properly; 8. Integrated management of pests and weeds; 9. Prepare systems for harvesting; and 10.Increase the capacity for mechanized harvesting.Although much to date has yet to be improved, PRONAR has facilitated the growth of production and productivity of sugarcane from its inception, as reflected in field and refinery yields.

Pest Management
The most important pests of sugarcane in Mexico are grass spittlebugs (various genera), stem-borers (various genera) and cane rats (various genera), which are distributed in all sugarcane cultivation areas (Flores, 2007).Spittlebugs cause losses ranging between 5 and 20 t ha -1 (CNPR, 2004).Methods of control include biological with the application of the fungus Metarhizium anisopliae, preparatory soil tillage, and chemical control (Toriello et al., 2008).
Cane rats are the most destructive pests of sugarcane plantations in the country, attacking approximately 30% of the cultivated area (Flores, 2007;CONADESUCA, 2013;Vásquez-López, Lorenzo-Monterrubio, & Bolaños-Citalan, 2013).It has been estimated that for every 1% of affected stems there is a reduction of 500 kg ha -1 of cane sugar.Additionally, there is an estimated loss of 2.2 kg per metric ton of sugar in the refineries for every 1% increase in damage intensity (Márquez, 2002;Flores, 2007).Methods of rodent control include cultural (based on modifying cane rat habitat using simple practices of weed control plots, dikes and irrigation canals) and biological, using birds of prey such as Accipiter spp., Buteo spp., Aquila chrysaetos, and snakes such as Boa constrictor, Conopsis spp., and Crotalus spp., achieving a 50% reduction in damage (Cervantes & Ballesteros-Barrera, 2012;Vásquez-López et al., 2013).
The primary pests, parasitoids and predators of insects in Mexican sugarcane cultivation are listed in Appendix A Table S5, while plant protection products authorized for control appear in Appendix A Table S8.

Disease Management
In Mexico, 55 plant diseases have been reported, 22 from parasites and 33 from non-parasites (Chinea-Martín & Milanés-Ramos, 2006).Among the most important diseases are rust, smut, mosaic and scald (CONADESUCA, 2011b).In addition to the genetic resistance provided by sugarcane varieties, use of pathogen-free seed has been implemented to prevent the spread of diseases.Heat treatments and tissue culture are disinfection methods that ensure plant health and seed cane.Although disease control in commercial sugarcane fields in Mexico is not a common practice, with the recent detection of orange rust [Puccinia kuehnii (W.Krüger) E. J. Butler] in the country, the National Service of Health, Food Safety and Quality (Servicio Nacional de Sanidad, Inocuidad y Calidad Agroalimentaria, SENASICA) has registered various fungal control products (SENASICA, 2011) (Rebollar-Alviter, Sánchez-Pale, & Silva-Rojas, 2012).The major diseases of sugarcane in Mexico are listed in Appendix A Table S6.

Weed Management
Control of unwanted vegetation or weeds is an essential practice in the early stages of sugarcane development, because if not controlled in a timely fashion, they can cause losses in crop productivity between 10 and 84% (Cruz, 2009).The most harmful weed species belong to the families Poaceae and Cyperaceae (order Poales), but species of the genus Ipomoea spp.(order Solanales; family Convolvulaceae) also interfere with sugarcane plant development (CONABIO, 2012).The use of herbicides (chemical control) is the most common form of weed control in most cultivation areas around the world.In Mexico, the most widely used herbicides are ametrine and diuron, which are recommended for postemergence application and have a residuality of one to two months, depending on moisture and soil type (Esqueda, 1999).A list of major weeds found in sugarcane cultivation areas in Mexico appears in Appendix A Table S7, whereas authorized control products that are registered with SENASICA (SENASICA, 2011) and permitted for use in the cultivation of sugarcane in Mexico are listed in Appendix A Table S8.The use of different organisms and natural active substances for the management and control of sugarcane pests are also being investigated (Arredondo-Bernal & Rodríguez del Bosque, 2008;CONABIO, 2012;Salgado-García et al., 2013).

Structure of the Mexican Sugar Agribusiness System
The Mexican sugarcane production system is a mosaic of cultural, social, political, economic, technical and educational factors that limit and slow rural development and industrial sugarcane production.To solve this problem, it is necessary to begin with the primary sector, the field, which is characterized by low income and yield per unit of production; poor agronomic practices; small cultivation areas (3 ha per producer on average); resistance to technological change because of cultural values and beliefs; complex social relationships; lack of enforcement of regulations and phytosanitary protocols; and organizational structures that maintain the damaging cycle of low production -low income -poverty -social, economic, environmental and political marginalization (Aguilar- Rivera, 2013).A recent analysis, however, shows that there are three determinants of sugarcane productivity: field performance and agribusiness, credit and irrigation, which contrast with the prioritization of needs for research-development-innovation that producers have been proposing: generation of new varieties, pest and disease control (CONADESUCA, 2013).
Currently there is a certain dynamic of transformation and modernization, not only to make this activity more productive, but also to address the challenges of climate change and globalization, including the use of new technologies, machinery and modern equipment, and considering environmental, employment and social sustainability indicators as well.However, these initiatives are erratic and inconsistent over time, restricting the consolidation of global competitiveness of the agribusiness system, which in terms of creating value is the second largest in the country, just after the maize value-chain (Aguilar- Rivera et al., 2012).
In terms of operational structure, the 55 sugar refineries currently operating in Mexico belong to 14 industrial groups, while six refineries are independent (for details see Appendix A Table S9) (MAM, 2013).Of the total, 76% of the sugar is in the hands of private business, while the remaining 24% is under federal control.Sugar productivity is highly variable and generally uncompetitive.For example, in the last harvest (2012/2013) the average supply ranged from 53.8 t ha -1 in Aszuremex Tenosique (Tabasco) to 125.8 t ha -1 in Tamazula (Jalisco), yielding a national average of 78.7 t ha -1 .In the previous harvest (2011/2012), the lowest yield was 35.9 t ha -1 from the refinery in Alianza Popular (San Luis Potosí) and the highest was 121.4 t ha -1 from Atencingo (Puebla), yielding a national average of 65.8 t ha -1 (CONADESICA, 2012, 2013) (a detailed analysis of the past 30 years is discussed later).This dichotomy between low and high productivity is due to differences in the size and capacity of the refineries, refinery age and level of technology, with a predominance of medium and small refineries, having an average age of 77 years, with obsolete and inefficient technologies, which increase production costs and decrease productivity.In addition, this value-chain is facing serious problems from environmental impact and is being severely criticized because it occupies large tracts of fertile land that could be used for the production of basic grains, accelerates deforestation and land degradation, forms implicit monocultures, contaminates or pollutes soils, surface and groundwater and air through the indiscriminate use of fertilizers, pesticides, herbicides, molasses, other waste products and the burning of cane fields prior to harvest (Aguilar- Rivera et al., 2012).Also common in this system are low seasonal wages, excessive working hours under deplorable conditions, and the employment of children and women in risky work.In fact, in Mexico there is no systematized project that has had sufficient time to develop human capacity at any stage of the value-chain.On average, 71% of the rural producers have only a basic education (six years of primary school) and 18% cannot read or write (Aguilar- Rivera et al., 2011), which further hinders constructive change.

Legislation and Organizations in the Mexican Sugar Industry
The legal framework supporting and regulating the sugar industry in Mexico is complex and extensive, and consists of the following contracts, laws and agreements: Ley de Desarrollo Rural Sustentable, Ley de Desarrollo Sustentable de la Caña de Azúcar, Programa Nacional de la Agroindustria Cañera 2007-2012, Ley de Promoción y Desarrollo de los Bioenergéticos, Ley para el Aprovechamiento de Energías Renovables y el Financiamiento de la Transición Energética, Contrato Ley de la Agroindustria Azucarera y Alcoholera, Ley del Seguro Social, Ley Federal del Trabajo and international free commerce (Blackaller, 2011).Derivatives of the Ley de Desarrollo Sustentable de la Caña de Azúcar (LDSCA, 2005), the National Program for the Sugarcane Agroindustry (PRONAC, 2007) and the Acuerdo para la Modernización de la Agroindustria de la Caña de Azúcar are intended to provide greater certainty for this national industry for the buying and selling, planting, cultivating, harvesting, delivering and receiving of sugarcane (Blackaller, 2011;CONADESUCA, 2013).

Agricultural Insurance for Sugarcane in Mexico
As a consequence of climate change, drought in Mexico causes 80% of the agricultural losses, while severe weather (e.g.storms, cyclones and hurricanes) contribute 18% of the damage (AGROASEMEX, 2006).In 2012, nearly 12 million hectares of national agriculture (54% of the cultivated area in the country) benefited from some form of insurance (SIAP, 2013).In Mexico, 80% of the insurance is concentrated on only four crops: corn, sorghum, wheat and sugarcane, and of this amount, 76.4% are operated by government insurance funds and 23.6% by private insurers.
Insurance for sugarcane represents 14% of the total agricultural area secured in Mexico, and 91.2% of the insurance is provided by private companies (AGROASEMEX, 2013).The 14 thousand hectares of sugarcane affected each year represent losses of 15.1 million dollars annually (Rivera, 2012).Currently, of the more than 780 000 ha planted with sugarcane in Mexico, 321 000 ha are insured, which represents 41% of the total area planted with sugarcane (AGROASEMEX, 2013).

Historical Productivity of Sugarcane and Sugar in Mexico
The Mexican sugar industry has had irregular development over the last thirty years, and the number of refineries has declined from 67 in 1980 to 55 at the close of 2013.In contrast, during this same period , the area planted increased by 39%, productivity of supply areas grew by 17%, factory efficiency improved by 19%, and sugar production grew by 62% (Figures 3, 4).The relative gains were due to factors related with government subsidies (8% of the total national agricultural subsidies), and some recent efforts to increase productivity through     2013) described the constraints on factor conditions including the high rainfed sugarcane producing areas (more than 60% of the total), migration and low-qualified labor market, an extraordinarily low R+D+I investment percentage compared with other countries, pre-harvest burning and air pollution, stagnating low sugarcane and sucrose yields, high production costs, byproduct production is not included in the final value of the industry as a whole, and the value-chain is concentrated only on three main products: sucrose, molasses and bagasse.Demand conditions limiting elements encompass a primary domestic market of sugar (75% of the sugar produced inland is consumed domestically), byproducts are not industrialized, a dramatic reduction of ethanol production (78.4%), while HFCS imports are significantly increasing.Concerning related and supporting industries, fewer refineries have certified processes, sugar production relies upon a few varieties, byproducts are not efficiently commercialized, ethanol and energy cogeneration are limited, and networks for R+D+I are lacking.As for the strategy, structure and rivalry, the private sector operates 76% of the refineries and the remaining 24% is operated by the government via the Fund of Expropriated Companies from the Sugar Sector (Fideicomiso para la Expropiación de Empresas del sector Azucarero, FEESA), the market is more focused on the offer instead of demand, product differentiation is scarce, and there is a general weakness of the system because of the lack of international competitiveness (the economic health of the system depends on domestic consumption and prices).The government controls the system by regulating prices of raw material and sugar, but has not created a good environment to make the sector competitive and an efficient infrastructure is lacking.Furthermore, the international crisis has not served as a catalyzer for the industry, whereas the country has no diversification programs and new niche markets are not well-designed.
One of the first guidelines for improving the competitiveness of the sugarcane value-chain is to increase human capacity through the development of knowledge and skills for all actors involved, but mainly for primary producers and field technicians.The latter should be continual and consolidate the management training program for information and communication technologies (ICT) for which SAGARPA began in 2008, but has not continued.
While Mexico has the capacity to increase up to seven times the area for sugarcane harvesting (from the current 800 000 to 5 million ha), this growth must be accompanied by good planning for the raw material (food, bioenergy, chemical industry), because refineries have not been modernized and the number of distilleries for ethanol has decreased significantly.The greatest potential for such growth is in the states of Chiapas, Jalisco, Morelos and Puebla, while refineries in the states of Campeche, Tabasco and San Luis Potosí would have to redesign their operations due to their lower productivity associated with agronomic-technical, environmental and socioeconomic limitations.
Analyses of the last production cycles (2000 to date) show that field performance has been irregular and, with the exception of the last harvest (2012/2013), the indicator has been declining.Points to address in this respect are associated with the limiting factors already described for the field, but also the possibility of increasing industry competitiveness using different strategies that involve increased performance in the field and refineries for access to credit and surface irrigation.Providing basic products, co-products, byproducts and derivatives for industries as varied as food, health, agriculture, chemistry, energy, transportation, housing and construction, are alternatives that have yet to be analyzed by decision-makers, producers, industries, scientists and academics, in order to take advantage of opportunities involving economic liberalization and industrial growth of the country.
Because internal situations cause lags in the field and refineries and low investment in R+D+I, it is necessary to rethink policies and strategies to improve the current system and successfully develop skills and potentials.Generation of domestic technologies, sustainable development of production processes and social responsibility, implementation of communication and information technologies, nanoscience and biotechnology and studies of domestic and global markets, are some of the suggested guidelines for achieving these tasks.Currently, Mexico has the capacity to develop projects for genome and metagenome sequencing, which opens up great possibilities for promoting development of this value-chain.
Thus, the new sugarcane production system in Mexico should be approached using holistic, inter-and transdisciplinary methods.The development of teams with complementary skills and knowledge (producers, industry, policy-makers, scientists and academics from different disciplines) will be critical for the success of these strategies.In work schedules, it will be necessary to develop educational programs, increase human development and knowledge management in the first hierarchical level, primarily for the less-educated producers so that it acts as a trigger for change in the management process.From there, and in accordance with PRONAR, it will be necessary to continue with technical aspects such as the diagnoses of soil conditions and limiting climatic factors; tillage and conservation of soil and water; dates and densities of planting; generation and selection of varieties and the production of adequate seed; proper management of crop nutrition (fertilization); integrated management of diseases, pests and weeds; as well as mechanized and green harvesting.A similar work schedule could be applied in the refineries, so that process management innovations are completed, including technological, organizational and commercial forms.

Conclusions
Sugarcane is a crop with great potential for growth in Mexico because of its potential to achieve more than 800 t ha -1 of fresh matter, compared to a current average value of 70 t ha -1 .Projections for land use predict that sugarcane cultivation in the country could expand to 5 million hectares.
Mexico has important scientific infrastructure, but it is not sufficient to meet the demands of many branches of the industry, so it will be necessary to increase public and private investments which are currently scarce and irregular.Among the priority issues to address is capacity-building for all actors involved in the value-chain, but primarily for producers with lower educational levels, and to continue to work on strengthening programs that generate new varieties (broadening the genetic base) capable of producing even under adverse conditions from climate change, improving agronomic practices for water management and crop nutrition (balanced fertilization based on studies of plant needs), expanding the system of recruitment and use of water and irrigation, continuing the search for sustainable strategies for the integrated management of disease-causing pathogens, pests and weeds, increasing mechanized and green harvesting, improving distribution from the supply areas to make more efficient use of transportation and fuel and of advances in information and communication, including, if possible, improvements in process automation.The diversification of the value-chain is an alternative that could increase the profitability of this activity, but it must be implemented using efficient planning and negotiation with the actors involved.To increase yields in fields and refineries, increased access to credit and irrigation infrastructure are critical.Concerning factor conditions, generation of new varieties, increases in productivity (both in cane and sucrose), diminishing production costs, sustainable and efficient use of water, green harvest, recycle of agricultural residues, digitizing sugarcane fields to improve agricultural precision, and converting conventional sugarcane mills into biorefineries to produce many value-added products such as glycerol, bioethanol, inositol, carbon dioxide, and succinic acid, would be among the actions to be implemented in order to improve the national sugarcane value-chain competitiveness.As for demand conditions, self-sufficiency for both sucrose and ethanol, diversification of white and brown sugars, using bagasse to fuel and cogenerate steam and electricity, carbon sequestration and carbon credits for clean development mechanisms, animal feed and supplements, high-value niche markets with a variety of novel products, and organic soil amendments need also to be approached.Furthermore, inputs, machinery, technology and services, energy and other sales of byproducts, inter-industry cooperation at national and international scales, as well as logistic operations must be taken into consideration in relation to similar and supporting industries.Finally, regarding firm strategy, structure and rivalry, the Mexican sugarcane production system must consider human resources to further education and technical training, technical assistance, process certification, wastewater treatment, integration and company management, farmer organization and prospective analyses, which are the primary actions to be carried out in order to reach competitiveness expectations.As well, by recognizing the importance of development of adequate infrastructure for sustaining growth and to ensure inclusiveness of the growth process, the government will continue to play a lead role in infrastructure development, as well as in legislation, establishment of new biorefineries, free trade agreements, competitive environments, R+D+I, regional clusters and access to information.Last, the Mexican sugarcane agro-industrial system has opportunities related to geographical location, emergence of new markets, bioenergy needs and a growing trend of cooperative relationships between private companies and universities.
The sugarcane value-chain is the second largest in the country, and is strategic in the generation of jobs, alternative energy, and substrates for other industries such as pharmaceutical, sucrochemistry and new approaches such as novel bio-factories.In order to make the Mexican sugarcane system a globally competitive one, the current crisis in this value-chain demands considerable effort from all stakeholders, including education and human development, while considering current and future technological advances.

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Figure 1.M tons, while for the la wher Figure 3.

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Figure 4. S

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Figure 4. S

Table S4 .
Primary climate and soil characteristics of the six sugarcane production regions in Mexico

Table S6 .
Most common diseases for sugarcane cultivation in Mexico