Mexico’s foreign trade set new records in July as exports surpassed US $80 billion for the first time ever, the performance driven by sales of computer and electronic equipment to the United States.

Merchandise sales abroad totaled US $81.4 billion last month, according to information released by national statistics agency INEGI on Thursday.

The surge in exports in July — up 43.7% year-on-year, the biggest leap in five years — comes amid a boom in investments related to artificial intelligence infrastructure.

This is the largest growth for any month since May 2021, when exports soared 125% as the country recovered from the most acute phase of the crisis triggered by the Covid-19 pandemic.

Disregarding the statistical rebounds in 2021 and May 2010 (the +43.8% bump that month was part of the recovery from the Great Recession of 2008-2009), July’s record represents the largest increase since at least 1993.

At the same time, imports totaled US $82.3 billion, increasing by 45.7% year-on-year. This represents the best growth rate since August 2021, though it resulted in a deficit of US $847.5 million, a month after June’s trade surplus of US $4.1 billion.

The strong export performance is primarily attributed to the 64.9% rebound in non-automotive manufacturing, which totaled nearly US $60 billion and represented 73% of total foreign sales.

“This data reflects a context wherein U.S. companies are demonstrating high demand for inputs to develop data centers associated with artificial intelligence,” Enrique Covarrubias, chief economist and director of analysis at Actinver investment bank, told El Financiero newspaper.

“It also comes at a time when the United States is tightening trade restrictions on the import of such inputs from Asian partners,” he added.

Analysts at Grupo Financiero Monex concurred, saying the advance in exports was driven by greater dynamism in non-automotive manufacturing, where shipments of electrical and electronic equipment and machinery stood out.

The total value of exported manufactured goods was US $76.3 billion, representing a 45.7% year-on-year increase.

The most significant advances were observed in exports of electrical and electronic equipment and appliances (134.0%), mining and metallurgy products (27.3%), machinery and special equipment for various industries (13.9%), plastic and rubber products (13.3%) and automotive products (2.4 percent).

Non-oil exports to the United States, which account for 84.5% of the total, surged 49.8% year-on-year in July and an improvement over the 35.9% growth reported in June.

In contrast, oil exports slowed their growth trend to 6.8% year-on-year in July, well below the 42.6% reported the previous month.

Conversely, sales in the extractive industry accelerated to 87.1%, up from 37.3% in June and marking 13 consecutive months of double-digit growth.

Agricultural products were the only export category that failed to achieve year-on-year growth, posting a negative-8.6% rate in July.

Meanwhile, the jump in imports can be attributed to the 56.3% increase in imports of intermediate goods, which accounted for 81.6% of total purchases. Also noteworthy was the 9.9% increase in imports of capital goods, the largest in 27 months.

The resulting trade deficit was Mexico’s first since February. The biggest factors were an oil trade balance that showed a deficit of US $3.7 billion, whereas the non-oil trade balance showed a surplus of US $2.8 billion.

Analysts at Banamex forecast a surplus of US $14.2 billion for the full year, anticipating 22% growth in exports and 20% growth in imports.

For its part, Monex says Mexico’s foreign trade will continue to be closely linked to the evolution of negotiations between Mexico and the United States, as part of the annual review of the USMCA, North America’s free trade agreement.

With reports from El Financiero, El Economista, La Jornada and Expansión