Image credits: SCT
News Article

Rail Cargo Gauges Impact of Community Blockades

By Pedro Alcalá | Tue, 12/15/2020 - 18:42

As of Dec. 11, 194 days of 2020 have seen some form of community blockades of railways, says the Mexican Railroads Association (AMF), according to T21. The states most affected by these blockades were Chihuahua, Sonora and Michoacan. According to AMF President Óscar del Cueto, these 194 days represent a dramatic increase when compared to previous years. In 2017, there were only 32 days of blockages. In 2018, there were 56 days and 64 days in 2019. 

Del Cueto commented that AMF wants to coordinate a more agile response mechanism with local, state and federal authorities to terminate these blockades as soon as possible. The association’s research shows that if a blockade is not broken within the first four hours of its enactment, it is likely to last for much longer. One of the longest blockades of the year was a 59-day long protest that ended on Nov. 30. The blockade was organized by teacher’s union CNTE members in the state of Michoacan. Their demands included the compensation of late payments and job availability. Another 60-day long blockade in Chihuahua ended on Oct. 26. The economic impact these blockades have caused is considered incalculable. T21 quotes White & Case Lawyer and Partner Vicente Corta, who claims that certain provisions in both Mexican law and the newly signed USMCA  protect operators and concessionaires against this economic impact by giving them the right to demand compensation for all losses. 

Despite a previously reported decrease in rail cargo traffic throughout 2020, this sector and the connectivity that it provides in Mexico has played a crucial role in maintaining vital supply lines active throughout the COVID-19 pandemic. There have been large investments planned for rail cargo connectivity projects that we have reported on, along with more recent examples reported by T21, such as a rail transfer terminal inaugurated in Celaya on Dec. 3 by company Ferroenlaces, with an investment of more than US$6 million, or the Santa Fe Bypass, which will begin operation in early 2021 and will give direct access to the Port of Veracruz to major rail cargo players including Ferrosur and Kansas City Southern. 

These blockades not only apply to rail cargo lines currently used, but also to those being constructed. One of the best examples is the Transisthmic Train, with nine months of delays, according to a previous MBN report. Blockades also tend to be independent of any criminal activity. Since November, the Mexican rail cargo sector has become more secure in regards to theft and robberies. One of the elements that can facilitate these blockades, however, is the lack of rail crossing infrastructure within towns and cities. T21 reported this month that SCT leader Jorge Arganis Díaz Leal is asking SHCP for more funds to build this kind of infrastructure which can protect rail lines from direct civilian interaction.

The data used in this article was sourced from:  
MBN, T21
Photo by:   SCT
Pedro Alcalá Pedro Alcalá Senior Journalist & Industry Analyst