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Efforts to manage a surge of northbound migrants at the US-Mexico border are disrupting trade flows between the countries after authorities shut down two rail crossings that handle tens of billions of dollars in goods each year.
US Customs and Border Protection on Monday closed railway bridges at the cities of Eagle Pass and El Paso, Texas, which respectively rank as the second and fourth busiest freight rail crossings with Mexico. The law enforcement agency cited the need to redirect personnel to help take migrants into custody after “observing a recent resurgence of smuggling organisations moving migrants through Mexico via freight trains”.
Shippers and railroad industry groups warned that the closures were disrupting trade in goods between the two countries, hitting industries from carmaking to farming. Eagle Pass and El Paso account for 36 per cent of rail traffic at the more than a dozen rail crossings along the southern border.
“The urgency of reopening these crossings and restoring rail service between the two nations cannot be overstated,” said Ian Jefferies, chief executive of the Association of American Railroads.
Union Pacific and BNSF — a division of Warren Buffett’s Berkshire Hathaway — were the two US railroads most directly affected by the closures, the association said. The parent company of Mexican rail company Ferromex, Grupo México, declined to comment.
For each day that the crossings are closed, Union Pacific must hold 60 trains — or almost 4,500 rail cars — with an equivalent amount of goods stranded in Mexico, the company said. Grain for export is currently being idled in six Midwestern states, with beer and dry food, cars, car parts, consumer goods, metals and cement also stuck.
The Eagle Pass and El Paso crossings account for 45 per cent of Union Pacific’s cross-border business, and “there isn’t enough capacity at our other four gateways to reroute them”, the company added.
“Most migrants are not crossing the border on trains”, Union Pacific said as it urged the US to reopen the crossing points.
The closures come as authorities struggle to process a surge of migrants seeking to cross the border. The US reported a record 2.5mn “encounters” at its southern border in the 12 months to the end of September, which includes migrants who seek asylum at a port of entry as well as those detained after an unauthorised border crossing.
BNSF said it was “disappointed” by the disruption, adding that “every day of closure increases the impact to the supply chain for critical commodities, including automobiles, industrial products and grain”.
From January to October, rail freight trade through Eagle Pass and El Paso totalled $28.8bn, according to the US transportation department, encompassing a wide range of commodities and consumer goods that flow north and south. The beverage category, which also includes spirits and vinegar, recorded about $3bn in trade, while cereals netted $1.8bn.
The blockages have the potential to ripple back into the North American rail network, threatening backups that could require some goods to be destroyed, said Bernstein analyst David Vernon.
The closures at Eagle Pass and El Paso could also cause stress on the Canadian Pacific Kansas City railroad, whose line through Laredo, Texas is the busiest rail border crossing.
Mexico has historically been a big destination for US-grown corn and other grains and oilseeds, which are mostly carried by rail. The National Grain and Feed Association and the North America Export Grain Association warned that livestock businesses in Mexico might run short of feed as the bridge closures persist.
There was “critical tightness in feeding supplies for several livestock feeders in Mexico”, the associations said.
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