By Vincent Wen    Photo：CANVA

According to analysts from the shipping rate benchmark and intelligence platform Xeneta, the China to Mexico route is currently one of the world's strongest trade lanes. Based on container trade statistics, the volume in January this year was 117,000 TEUs (twenty-foot equivalent units), compared to 73,000 TEUs in January 2023. The container shipping annual growth rate between China and Mexico reached 34.8% in 2023, compared to only 3.5% in 2022.

The latest data may further prove that Chinese companies are attempting to circumvent tariffs on goods imported from China to the United States, which have increased during the ongoing trade war between the two countries. It is said that trade between China and Mexico grew in 2023, but the latest data for January 2024 shows a significant increase in trade between the two countries.

This may be the fastest-growing industry on the planet right now. Importing goods from China to ports on the west coast of Mexico is seen as a viable alternative to directly reaching the west coast of the United States. However, as freight volumes continue to increase, importers will face a potentially volatile shipping market.

A considerable portion of goods arriving in Mexico by sea may be transported to the United States by truck, raising suspicions that the trade growth we're seeing is due to importers attempting to avoid tariffs in the United States.

In a purely hypothetical scenario, if this growth rate continues, by 2031, container shipments from China to Mexico will surpass those to the U.S. west coast. This demonstrates how rapidly the demand for shipping is growing.

Just last year, Mexico City opened a new cargo airport, which is another sign of the expanding imports. I doubt this situation is solely due to increased demand in Mexico; rather, it's likely because it serves as a back door into the United States.

However, there are risks for importers choosing to shift their ocean supply chains to the west coast of Mexico. Not only is the rate of cargo theft high, but it also extends to extortion and the payment of 'derecho de piso' (a type of extortion fee) on foreign trade goods.

Facing the wave of goods shifting from Mexico into the United States, there are still challenges in infrastructure, training, rule of law, and digitalization. From January to August 2023, an average of 45 transport accidents or incidents occurred each day, not including unreported and undocumented incidents. It's regrettable that not only is the number of cases continuing to increase, but the criminal behavior is also worsening, with cargo theft being the most common. Now, even operators and drivers are losing their lives, and equipment or goods are being destroyed.
 

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