In 2015, the volume of goods mobilized by rail in Mexico fell 25.8% and is expected that by the end of this year the problem will increase to a loss of three thousand 800 million pesos.
For the first time in nine years, companies that provide transportation service by train in Mexico, Ferromex and Kansas City Southern (KCSM) mainly, failed to earn income of 3 billion 200 million pesos in 2015 and the expectation is that by the end of this year the amount will grow to about 4 billion because its customers are leaving due to insecurity.
In 2015, the volume of mobilized rail freight in the country fell 25.8 percent, standing at 46 million 616 thousand tons, according to data from the General Directorate of Railways and Multimodal, under the SCT. This contraction in the local rail transport has not been seen since 2007.
The volume of cargo for Mexican railways meant not billing more than 3 billion 200 million pesos last year, according to a calculation based on data gathered by 'El Financiero' companies and the SCT.
Experts believe that this problem will grow in 2016, when the railroads will mobilize 41 million 689 thousand tons in the domestic market, 11 million less than in 2015. This will mean that companies won't earn income by 3,800 million pesos.
"We had 24 incidents related to insecurity per day in September, we have met with the federal police, army, state police, and government. This situation has decreased in October and hopefully will normalize in the third quarter " said Alfredo Casar, president of Ferromex in a conference call with analysts.
According to the firm, in 2013 the average daily incidents was 3.4.
Recently, the Federal entities that have the highest theft incidence are Queretaro, Guanajuato and Aguascalientes, which recorded significant increases.
Theft to trains in Mexico has been increasing, mainly in the Bajío. According to initiatives developed by deputies and the recent demonstrations of railway companies, currently 25 robberies are committed as a daily average, although not all are reported to the authorities.
Rogelio Velez, CEO of Ferromex, said last July that the assailants, whom are paid between 500 and 600 pesos, get on board at urban crossings, close the brake valves and force the train to stop for time that gangs exploit to steal merchandise.
Braking a train makes the whole chain stop to avoid accidents, which implies that about 20 convoys per day idle, added the CEO.
"There has been a factor that has affected the rail lately: The blockage of the railway tracks, creating some concern among users, particularly those who have to move goods short distances, maybe they have decided to migrate to road transport "explained José Zozaya, president of Kansas City Southern Mexico (KCSM).
The US FreightWatch report details that 27 percent of thefts relate to food and beverages, 11 percent to construction-related products and industrial inputs, and another 11 percent relate to fuel.
Volume of cement transported, for firms like CEMEX , contracted 1.5 percent in 2015. This staple represents 8.3 percent of the total cargo. Pemex fuel oil means 1.7 percent of the total rail load, had a 37 percent drop last year.
ROAD TRANSPORTATION WINS
The business that left rail due to insecurity was taken up by Truck carriers.
"Insecurity on the train is different, being single track, the goods are stopped and are stolen. In road transport there are several alternatives, there are options open to users, however, the lack of rail track development and insecurity enhances the migration of said cargo to truck transportation, truckers being winners of this market" said Enrique Gonzalez, delegate of the National Chamber of trucking in the Bajío.
The railway sector is considered as optimal for large volumes and distances on land, as it reduces transportation costs as compared with trucking. "When you stop using it, this action may increase business costs and higher costs may be transferred to the products," said Jose Luis Fuente, president of the transport committee of CONCAMIN.
"In Mexico safety indexes have improved in some areas, we believe that is due to having the entire automotive industry together in an area, particularly as Mexico produces automobiles for many countries," lamented Zozaya.
Source: elfinanciero.com.mx