Major Agreement Signed For Railway Improvements At Nogales Border Crossing

Major Agreement Signed For Railway Improvements At Nogales Border Crossing

By Terri Jo Neff |

The cities of Nogales, Arizona and Nogales, Sonora signed a Memorandum of Understanding last week that will allow construction of a new international railway crossing and relocation of train tracks to a less urban area east of the current tracks.

The agreement signed by Mayor Juan Francisco Gim Nogales of Nogales (SON) and Mayor Arturo Garino of Nogales (AZ) was witnessed by Heriberto Aguilar Castillo, the Sonoran Secretary of Infrastructure and Urban Development on behalf of the State of Sonora.

Business leaders on both sides of the border have been pushing for decades for improvements to rail infrastructure leading to and at the international crossing. Rerouting the tracks and upgrading the crossing has been a priority for Gov. Alfonso Durazo Montano of Sonora when he took office last summer.

Any financial commitments on the part of the two cities was not revealed during the signing ceremony, but Durazo previously suggested that $36 million (US) would be available from Mexican government entities.

Union Pacific Railroad operates the track from Nogales north to its East-West Sunset Route in Tucson. Heading southward from Nogales, Ferromex Rail serves customers along routes to Hermosillo, Guaymas, and Guadalajara.

In May, Durazo facilitated a meeting with Union Pacific, Ferromex, and other stakeholders to emphasize his support for the project. He pointed to public safety issues that have long plagued emergency responders on both sides of the border, and he noted there will be a significant increase in demand for expedient freight train service once the Port of Guaymas is upgraded.

An average of 70 northbound trains come into the U.S. through the Nogales Port of Entry each month, with traffic on pace to exceed 800 trains for the first time in more than six years. However, construction of the new crossing is a long way off, as both cities must undertake feasibility studies to identify the best location for the new international crossing and for the layout of the train tracks.

The Nogales rail project will complement Mexico’s $245 million (US) modernization of the Guaymas area championed by Mexico President Andrés Manuel López Obrador to expand the port, reinforce docks, and upgrade technology.

According to the UA Eller College of Management, Nogales has the oldest rail crossing of any border port of entry along the U.S. / Mexico border. Automobiles manufactured at the Ford Motors plant in Hermosillo, Sonora are shipped via rail to U.S. and Canadian markets through Nogales, as are bulk commodities such as cement and agricultural product.

“The dynamics of train crossings, and number of rail containers through the Nogales border port of entry reflect the composite effects of both trade between Mexico, Canada and the U.S., as well as between Arizona and Mexico,” according to the Eller College of Management’s Arizona-Mexico Economic Indicators.

Data provided by the UA Economic and Business Research Center shows more than $11.8 billion in U.S. exports went to Mexico in 2021 through U.S. ports of entry in Arizona. Nearly $10 million of that crossed through Nogales by either vehicle or rail.

Meanwhile, $17.6 million was imported across the U.S. ports of entry in Arizona from Mexico in the same period, with all but $3 billion coming through Nogales.

Ducey Highlights AZ-MEX Trade With Visit To Nogales While Produce Importer Warns Of Higher Prices

Ducey Highlights AZ-MEX Trade With Visit To Nogales While Produce Importer Warns Of Higher Prices

By Terri Jo Neff |

The grand opening of a 60,000 square foot refrigerated warehouse in Nogales was used by Gov. Doug Ducey this week to draw attention to Arizona’s strong trade relationship with Mexico, the state’s top trading partner.

Ducey traveled to the Santa Cruz County border city Wednesday at the invitation of Jaime Chamberlain, president of Chamberlain Distributing which imports fruits and vegetables from the northern Mexico state of Sonora. The governor toured the facility and took part in an economic roundtable with local business and community leaders focused on Arizona’s economic relationship with Mexico.

Nearly $16 billion in trade occurred between Arizona and Mexico in 2020, with more than $13 billion of that passing through the Nogales Port of Entry. And this month, the University of Arizona released its First Quarter 2021 AZMEX report of economic indicators showing Arizona exports into Mexico reached its highest level since mid-2019.

Ducey said commercial truck traffic into Arizona from Mexico increased by more than 2,500 vehicles in 2020 despite the COVID-19 pandemic which continues to restrict border crossings to essential traffic only. The new Chamberlain facility will help further Arizona’s relationship with Mexico and improve economic growth once the Biden Administration lifts cross-border travel restrictions, the governor said.

However, the UA AZMEX report also reveals the nearly $1.3 billion in fresh produce imports through Arizona’s ports of entry represented a nine percent decrease from the same period in 2020. And that lower supply will likely cause retail food prices to increase across the United States, according to Chamberlain.

Chamberlain noted the company’s new warehouse will help get produce into the United States faster and fresher, but farmers in Mexico are facing a variety of challenges that will boost production costs, something that will be passed along to consumers.

“The drought will curtail planting season and farmers will think twice what they’re able to plant and plant successfully,” Chamberlain explained, adding that higher production expenses for seeds and fuel are also driving up costs for farmers.