A major uptick in commercial cargo traversing Mexico’s seaports is a strong indication that the country is increasingly important to North America’s supply chain, according to a recent industrial research market note published by Cushman & Wakefield, which reports that Mexico’s ports led the North American container trade in 2014 with 3.5% year-on-year growth. US ports grew 2.6% during that period, and Canadian ports by 1.6%.
Import volumes at Mexico’s ports also saw a 9.2% year-on-year increase. Total North American inbound was 6.4%. In the past two decades, commercial cargo in Mexico has grown twice as fast as the nation’s GDP.
A contributing factor is Mexico’s surge in automobile and parts manufacturing. In 2014, Mexico manufactured a record 3 million light vehicles. Today the country is a major supplier of vehicles, electronics and other goods, primarily for US consumers. Mexico’s rising middle class also desires more imported goods, while manufacturing is increasing throughout the country.
Mexico’s ports play an important role in attracting manufacturers to the country. To keep pace with growth, the report outlines how the Mexican government is investing more than $5bn in the country's port network. At the Port of Veracruz, $1.8bn is being spent constructing two container terminals to be operational by 2018. The expansion will increase port capacity by more than 400%.
The Port of Lazaro Cardenas, which handles some 1 million TEUs per year, is being expanded with a new TEC2 deep-water container terminal, scheduled to open in mid-2016. It will be the first automated terminal in Latin America. A big plus to the port is on-dock rail facilities provided by Kansas City Southern de Mexico, which provides on-dock intermodal links directly into the southern US and the shortest route to Mexico City.