Mexico Needs to Optimize Port Logistics

Problems have arisen in Latin American ports following the COVID-19 pandemic. Latin American economies are taking advantage of maritime transportation to streamline logistics but this has brought new challenges for the maritime and logistics sectors. A great example of this is Mexico, where maritime transportation in the country has increased considerably due to the pandemic, both for consumption and exports of automotive and electronic products, reports El Heraldo. This is something that is expected to continue for the end of 2020 and the first three months of 2021, Patricia Pérez Salazar, Sales Director of Maersk Line in Mexico, told El Heraldo. “In 2Q20, cargo decreased 23 percent but in 3Q20 we saw a recovery in all industries, particularly in retail because of consumption but also in automotive and electronics,” she said. In 3Q20, there was a reported 18 increase in cargo against 2Q20, El Heraldo highlights.

However, this enables new opportunities for countries in Latin America, where optimizing chain distribution channels makes regional contenders even stronger. “The first thing we are going to see is a large unbalance, greatly caused by the crisis the pandemic brought. However, this can also make people reflect on what is happening with world corridors, (such as) Asia-Europe, Asia-America and America-Europe. We can see certain rearrangements that are not necessarily caused by the pandemic but some sort of protectionism in economies and countries,” Jorge Lecona, CEO of Hutchison Ports for Latin America and the Caribbean, told T21. To Lecona, the pandemic agitated world economies, which also altered volumes of commerce in the main maritime corridors, which is why the port industry has to rethink what will happen with future trade. “We can now think about what will happen with ports in Latin America and the Caribbean each time the shipping industry has larger boats … We are starting to see a cascade effect: there are larger and larger ships arriving at our ports. The challenge ports have is to satisfy large volumes with fewer arrivals, due to the increased size of ships,” Lecona highlighted in T21. He mentions three pillars of technological modifications to address this: terminal automation, smart ports where one can predict the behavior of each terminal with artificial intelligence (AI) and security. Technological efforts have to be made to reduce the costs of these modifications.

There is an opportunity in the reconfiguration of supply chains, as well. “In China, where the pandemic shut down many factories, there were many ruptures in stock and payments. To avoid future shocks, the pandemic led to the reconfiguration of supply chains and now there is an opportunity for countries in nearshoring,” explained Agustina Calatayud, Main Specialist in Transportation of the Inter-American Development Bank (IADB), reports T21.