Cheez-Its, chocolate, and candy are some of the top exports from Mexico during the coronavirus pandemic
Logistics professionals in the Texas border city of Laredo said they have been busier than ever since the coronavirus pandemic erupted about a month ago.
Port Laredo — a sprawling customs district along the United States-Mexico border in South Texas — sees around 14,000 commercial trucks cross its international bridges every day.
Imports from Mexico into the U.S. rose 7% from February to March, said Gerardo Alanis Barrios, CEO of Cold Chain Solutions.
These are unprecedented times that have definitely altered the transportation and logistics industry in ways I had never seen before,” Barrios told FreightWaves.
Laredo-based Cold Chain Solutions is a refrigerated carrier and refrigerated cross-dock operation servicing the consumer packaged goods, refrigerated and frozen food industries in Mexico, Canada, and the U.S.
“In our sector, we have seen our frozen vegetable-fruit, candy and packaging exports sky-rocket, our studies show that panic-buying has been the motor behind this,” Barrios said.
Barrios said his company has seen a drastic spike in imports of Oreo and Chips Ahoy cookies, chocolates, and Cheez-It crackers.
Kellogg’s, which makes Cheez-Its, has four plants in Mexico. Mondelez International, which makes Oreo and Chips Ahoy cookies, has five factories in Mexico.
While frozen foods and snacks are in demand, Barrios said his fresh produce import operation has stagnated due to restaurant closures.
“States such as California and New York have become difficult to service with our third-party logistics division as an important chunk of companies have suspended operations, causing state outbounds to dwindle down, hence making it impossible for companies to have an ongoing circuit between California and Texas,” Barrios said.
As for southbound freight — exports into Mexico — Barrios said his firm has been moving a lot of beef, poultry, Canadian pork, and frozen pizzas.
After peaking at 10.58% on March 26, the Outbound Tender Reject Index (OTRI.LRD) has slipped to 7.45% on April 2. Capacity is still tight around Laredo, and OTRI remains higher than at any point in 2019.
Ermilo Richer III, executive director of Laredo-based customs broker Richer, said his company has also been staying busy since the pandemic began in the U.S.
“In operations, with trucks crossing, and customers calling, it’s business as usual,” Richer told FreightWaves. “Behind the scenes, we are just trying to keep up with the demand.”
Richer is one of the oldest and largest customs brokers along the U.S.-Mexico border. The company, founded in 1917, includes a customs brokerage, as well as transportation, logistics and warehousing operations across Mexico and Texas.
Richer said his employees on both sides of the border have continued to work hard through uncertain times.
“Consumer packaged goods are still moving. They are jumping right now because consumer products stores are trying to keep their shelves filled up for whatever products they sell out of,” Richer said. “It’s hard to predict where the market is headed. What my customers are telling me is they have orders for April and May right now.”
Richer said he expects a drop-off in demand for raw materials associated with the construction and automotive industries, which will lead to lower freight volumes.
“We don’t know what’s coming because the world economy is falling apart, but right now we are business as usual, working hard,” Richer said. “I think it’s going to hit everyone at some point; sooner or later, that bubble is going to burst and it is just going to happen.”
Barrios said his firm is also preparing as best it can for the next few months. He praised his employees — who include drivers, warehouse workers, and customs agents — for their hard work.
“A lot of companies here in Laredo have closed their door, and our team hasn’t. We can’t because we have to be at the warehouse, in the yard, to keep working,” Barrios said. “Our team here has been incredible.”
Source: freightwaves.com
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