News / Box terminals expand as Lazaro Cardenas eyes boost from near-shoring

Photo: APM Terminals

The terminal operators at Mexico’s second largest container port on the Pacific coast, Lazaro Cardenas, are poised to expand capacity.

Less than two months after APM Terminals kicked off phase two of its expansion, Hutchison Ports announced it would start the expansion of its Specialised Container Terminal 1 in the new year, which is expected to take three years.

The $220m project will boost terminal capacity from 1.3m teu to 2m teu and will include construction of 345 metres of quay and 28.3 ha of yard space. Upon completion, the terminal will boast a quay length of 1,275 metres, backed up by 105 ha of yard space.

In addition, Hutchison plans to acquire 25 rubber-tyred gantry cranes and 10 quay cranes.

Work on APMT’s facility at the Mexican port got under way in early September, involving a $140m investment to double capacity to 2.2m teu, add more than 15ha of yard space, an upgrade of the facility’s operating system and the acquisition of 28 automated rail-mounted gantry cranes. Completion is scheduled for Q1 26.

Hutchison officials linked the expansion to nearshoring. Mexico has enjoyed a massive influx of foreign investment as companies set up production facilities there to feed the US market.

The port of Lazaro Cardenas itself enjoyed robust growth last year, container throughput surging 54% over its 2021 tally. In addition, the port has established itself as a key gateway for auto imports.

Over the first nine months of the year, container throughput on Mexico’s west coast increased 0.6% to 4,530,566 teu, led by the port of Manzanillo, where container count was up 6.4%. It handles about 60% of the container traffic on the coast.

Lazaro Cardenas, which accounts for about 30% of the west coast total, fared less well in the January-September period. Its tally of 1,371,586 teu was 10.8% down on the same period last year. However, this marked an improvement over a 15.9% drop in the first eight months.

Despite the decline in containers, the port has struggled with congestion this year. Much of this was due to a surge in auto imports, but container traffic was impeded by a blockade of the Ferrovalle intermodal terminal by local truckers, which lasted over three months and left over 5,000 containers stuck at Lazaro Cardenas.

While the near-shoring scramble has failed to boost the port’s volumes this year, judging from its lower box data, the overall economic climate would appear to provide some tailwind – with transpacific carriers reportedly making more ad hoc as well as regular calls at Lazaro Cardenas recently to move traffic from Asia to the US Midwest.

This has been linked to the low water levels on the Panama Canal, which has led to restrictions on the number of container vessel transits, while Lazaro Cardenas has direct rail service to the Midwest through Canadian Pacific Kansas City, which has been aggressively marketing the route to shippers in Asia.