Monday, May 20, 2024

Mexico is US’s largest trading partner in 2023’s 1st quarter

Mexico was the United States’ largest trading partner in the first quarter of 2023, with exports of US $115.5 billion, according to figures released by the U.S Census office on Thursday.

​​Figures for Q1 2023 showed that total trade between the two countries (a combined total of imports and exports) was US $196.7 billion, an 8% increase over the same period in 2022.

Manzanillo port
Primary exports to the U.S. include refined petroleum, office supplies, automobile parts and integrated circuitry, according to the OED. (Depositphotos).

In March alone, goods from Mexico accounted for 16.1% of U.S. imports — beating out Canada (15.5%) and China (10.1%) — for a total of US $42.8 billion. The figure represents annual growth of 5.9%. 

China has topped the list in Q1 of each year since 2009 — with the exception of 2020, when the Covid-19 pandemic saw Mexico take the top spot. But in March, China saw exports drop 35% to US $30.8 billion. 

Last year’s top whole-year trading partner, Canada, saw a 7.2% year-on-year drop in exports to the U.S market in March, registering only US $37.6 billion. 

U.S. exports to Mexico also rose 2.6%, to US $29.3 billion in March — despite a year-on-year fall of 0.4% compared to 2022. Despite the rise, the U.S. still maintains a US $97 billion trade deficit with Mexico, or 12%, said the Economic Commission for Latin America. This figure has contracted considerably, however, previously standing at 39% in 2020.

Mexican peso and US dollar
A strong peso has buoyed export conditions in Mexico, although some experts are concerned that the exchange rate may remain volatile in the coming months. (Rmcarvalho/Istock)

The recent “super peso” and weakened U.S. dollar have created favorable conditions for export, but credit analysts Moody’s warned that there was some uncertainty surrounding global solvency for financial institutions, as well as volatility in the bond market that could lead to further fluctuations in exchange rates.  

Mexico has become a nearshoring hub, with businesses from Asia rushing to set up operations in the country, taking advantage of the favorable investment conditions and proximity to the North American markets. This has led to a boom in manufacturing, especially in the automobile industry, but also increasingly in data, computing and home electronic goods, which are often exported to the United States.

Top exports from Mexico in 2023 included refined petroleum, auto parts and accessories, office machinery and integrated circuits, according to the Observatory of Economic Complexity.

With reports by El Financiero, El Economista, OEC and U.S Census Bureau

Have something to say? Paid Subscribers get all access to make & read comments.
Three women shield themselves with umbrellas during a heat wave in Mexico.

Parts of Mexico expecting temperatures above 45 C as third heat wave begins

0
Only six states will stay below maximum temperatures of 40 C this week, with the northern and southeastern regions bracing for highs above 45 C.
A worker loads bags of ice onto a cart.

Got 1 min? Oxxo limits ice sales in CDMX to prevent shortages during heat wave

0
Stepping out for some ice from your corner Oxxo? Be prepared to find a sparsely stocked ice chest.
Waiters carrying trays in a hotel

Is Mexico getting too expensive too fast?

16
Mexico News Daily CEO Travis Bembenek explains how increased wages without increased productivity can cause serious problems for businesses.