Volume rose 4 percent at top US cross-border trucking gateways

Volume rose 4 percent at top US cross-border trucking gateways

The number of tractor-trailers that passed through the top five U.S. border crossings rose 4 percent in 2014, as stronger U.S. industrial output drove trade with Canada and Mexico. The truck gain also comes as importers had difficulty getting goods inland from U.S. seaports.

The increase in truck traffic in 2014 reflects the strong partnership between U.S. and Canadian manufacturers and the growing importance of Mexico as a U.S. trading partner. Rising traffic and congestion could fuel more demand for infrastructure investment, and for more Customs agents and extended gate times at the border.

Truck volumes moving through the largest U.S. border crossing at Laredo, Texas, rose 5.5 percent from 2013, while Detroit, the second-largest U.S. border crossing in terms of truck traffic, saw the number of trucks moving to and from Ontario, Canada rise 1.4 percent.

Truck traffic increased 2.7 percent at Buffalo, New York, 5.2 percent at Otay Mesa, California and 6.4 percent at Port Huron, Michigan, the third-, fourth- and fifth-largest U.S. border crossings for trucks, respectively, U.S. Bureau of Transportation Statistics data show.

Those growth rates were all higher than the previous year, when Detroit and Otay Mesa saw truck volumes drop from 2012 as the U.S. recovery slogged through a “soft patch.” Faster U.S. growth starting in the second quarter of 2014 sent more trucks to the border.

Altogether, the top five crossings handled 53 percent of cross-border truck traffic —  6,052,535 trucks, their highest combined number since 2005. The total number of trucks crossing the U.S. border last year rose 3.4 percent to 11,216,779, according to the BTS data.

U.S. trade in goods with Mexico and Canada, which topped $1 trillion in 2011, rose 4.5 percent last year to $1.19 trillion, according to U.S. Census Bureau data.  U.S.-Mexico trade rose 5.5 percent to $534.5 billion, while U.S.-Canada trade rose 3.8 percent to $658.1 billion.

Although truck-borne trade between Canada and the U.S. is larger than between the U.S. and its southern neighbor, Mexico is closing the gap, in terms of border crossings by truck. In 2014, 48 percent of truck border crossings occurred on the U.S.-Mexican border.

That compares with 39 percent of cross-border truck volume in 2004. In 2014, 5,414,568 trucks crossed the U.S.-Mexican border, a 20 percent increase from 2004. In contrast, Canadian cross-border truck traffic was 16 percent lower in 2014 compared with 2004.

Cross-border truck volumes dropped 27 percent on the northern border from 2004 through 2009, and have only recovered 16 percent, still totaling less than in 2008. Mexican truck crossings peaked in 2007 and dropped 12 percent through 2009 before rising 26 percent.

Of course, Mexico’s volume is growing from a smaller base, but increased exports and growing industrial output are spurring Mexican growth and trade. In the fourth quarter, Mexico’s economy expanded at the fastest pace in two years, Bloomberg reports.

Manufacturing activity in Mexico expanded 3.7 percent in 2014, the country’s national statistics agency reported, with automotive suppliers and export-focused maquiladora plants leading the way. Most Mexican exports still head to the U.S., and most move by truck.

In Canada, growth in manufacturing is centered on Ontario. The economy of the central Canadian province is expected to grow 2.9 percent in 2015, bolstered by strong exports to the U.S. and consumer spending, according to the Conference Board of Canada.

Exports of industrial machinery from Ontario to the U.S., for example, could rise 17 percent this year, Export Development Canada said. “Tight industrial capacity stateside is igniting U.S. business investment,” EDC Chief Economist Peter Hall said last November.

In December, the number of spot market truckloads exported to the U.S. increased 41 percent, load-matching service TransCore Link Logistics said. In the fourth quarter, the number of spot truckloads bound for the U.S. from Canada rose 54 percent on average.

Lower oil prices are a drag on the rest of the Canadian economy, especially in energy-rich Western provinces. Canada’s gross domestic product is now expected to grow 1.9 percent in 2015, compared with 2.4 percent last year, the Conference Board said Feb. 23.

Contact William B. Cassidy at wcassidy@joc.com and follow him on Twitter: @wbcassidy_joc