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Imports Plunge Threatens Baja Mexico Port Project

PUNTA COLONET, MEXICO-The rapid deterioration of global shipping might mean this multi-billion -dollar project is never built.

By John McCloud | Updated on January 21, 2009

PUNTA COLONET, MEXICO-Mexico’s decision to postpone and perhaps cancel development of a massive new container port at this site on the north end of the Baja Peninsula underscores how quickly global shipping has deteriorated in the face of a struggling international economy. The government-sponsored consortium responsible for building the $5 billion project opened preliminary bidding on the project less than a year ago but was forced to retrench in response to a precipitous drop in trade, particularly at ports along the West Coast.

The widespread recession has led to a dramatic fall in traffic at Pacific Coast ports in the US, Canada and Mexico. In particular, the ports of Los Angeles and Long Beach experienced their weakest performance in more than a decade, with total December container volume dropping 25.8% from the same month in 2007 and the yearly total off approximately 15%.

The Punta Colonet development is intended to take advantage of increasing congestion at the two US ports by siphoning off business to what would be a newer and more efficient destination a few hundred miles to the south. The Mexican project was planned to include a new rail line from Punta Colonet to the US-Mexico border so goods destined for US markets could be unloaded in Mexico for placement into the US logistics system.

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