A Mexican company is moving into Tucson with plans to ramp up production of liquefied sugar cane to compete with widely used high-fructose corn syrup.
“We already do it throughout (Mexico) with major customers,” said Carlos Rionda, vice president of sales and marketing for Sinaloa-based Zucarmex. The Port of Tucson’s ability to bring the sugar up from Mexico by rail sealed the deal, Rionda said.
Zucarmex has signed a five-year lease at the Port of Tucson and expects to start its Tucson operations within a few weeks with about 20 employees. Plans are to hire up to 50 employees as the company accelerates production of liquefied cane sugar.
Tucson could be the place where the company’s five U.S. distribution sites are consolidated in the future, Rionda said.
“It is one of the few facilities in the U.S. that has that capability — in essence their own railroad,” he said. “We feel we can service all West Coast markets from there.”
The Port of Tucson, near Kolb Road and Interstate 10, sits just off Union Pacific’s main line and has spurs that go directly to tenants’ warehouses.
Initially, Zucarmex will occupy 30,000 square feet with the option to use up to 60,000 square feet for warehousing, processing, packaging and liquefying operations.
Other sugar producers are watching Zucarmex’s expansion and could follow suit, creating a supply chain in Tucson, Rionda said.
“This could be the start of a great opportunity, not only for Zucarmex but for Arizona,” he said.
Tucson Mayor Jonathan Rothschild praised the announcement.
“I’m convinced that if we get our feet on the ground and spend more time with our neighbors, we will see a pipeline of opportunities for our region,” he said. “Zucarmex is just the kind of company that we are poised to help, both for their business and for our community.”
Juan Padres, economic development specialist for international trade with the city of Tucson, said the city’s location, in the middle of California, Nevada, Texas and Mexico, on the Union Pacific main line and with access to major interstates, is attracting interest from companies around the country and in Mexico.
“We are more competitive when it comes to logistics,” he said. “If we work together regionally, we can attract the big boys.”
The Zucarmex product, Zulka Pure Cane Sugar, is carried by several large retailers. The sugar is unrefined and granulated, made from harvested sugar cane.
The five Zucarmex sugar mills are in tropical areas of Mexico. The company has more than 4,000 administrative employees and 15,000 farmers. It produces 600,000 tons of sugar a year.
The United States must allow access to Mexican sugar under the terms of the North American Free Trade Agreement. In 2012-13, more than 2 million tons of Mexican sugar was imported to the U.S.