Mining Sector Declines Amid 0.2% Industrial Growth in 2024

Mexico's industrial production experienced a 0.2% annual growth in 2024, despite a contraction exceeding 4% in the mining sector, reported INEGI. The 2024 results contrast with 2023, when industrial production increased by 3.5%, driven by construction and growth across all sectors.

Annual growth was mainly attributed to increases in construction with 2.7%, electricity generation, transmission, and distribution, along with water and gas supply with 1.6%, and manufacturing with 0.3%. However, the mining sector saw a decline of 4.3%.

In December, industrial production fell by 2.7% year-on-year, continuing a trend of five consecutive months of declines. The decrease was due to reductions in manufacturing with -0.6%, mining with -6.3%, and construction with -7.5%. In contrast, growth in electricity generation, water supply, and gas distribution helped soften the downturn with a 1.7% increase.

The monthly industrial activity index (IMAI) also reflected a 1.4% decrease in December, based on seasonally adjusted data, compared to the previous month. This was driven by declines in construction with -2.1%, electricity generation, water, and gas supply with -1.9%, manufacturing with -1.2%, and mining with -1%.

Experts point out that the decline in the mining sector can be attributed to the previous administration's policy of freezing new concessions, along with uncertainties surrounding the Mining Reform and the proposed open-pit mining ban. While optimism returned to the sector after President Claudia Sheinbaum announced that her administration would review the proposed ban, the outlook remains uncertain.