US agroindustry calls on Mexico to beef up investment in freight rail infra

A total of 26 agroindustry groups in the United States have asked the government to demand that Mexico boost investment in freight rail infrastructure to avoid delays in US exports.

According to a letter sent by the groups – which include the Corn Refiners Association, the National Cotton Council and USA Rice – to agriculture secretary Tom Vilsack and quoted by Mexican daily Reforma, the existing infrastructure in Mexico is not sufficient to meet today’s rail transportation needs.

“The large demand in rail services along with insufficient investment in rail infrastructure has caused seizures, congestion, and slowdowns in the [transportation] services of US agriculture products on behalf of Ferromex, one of the main rail companies in Mexico,” says the document.

To cope with the current situation, Ferromex is forced to prioritize transportation of some goods over others, a practice that have negatively impacted US exports, according to the trade groups.

Insufficient rail capacity has been “a persistent problem since the end of 2023 and seems to be the most important problem affecting the rail [transportation] service of US agriculture products in Mexico,” the document reads. Migrants using freight trains to reach the Mexico-US border is another issue that is aggravating the problem, it adds.

According to the letter, more than US$30 billion worth of US agriculture goods were exported last year to Mexico, which is one of the largest markets together with Canada and China.

Mexico’s president-elect Claudia Sheinbaum recently said she will prioritize rail projects as part of her national infrastructure plan. However, the projects she has given priority status are for the passenger rail segment.