TREND: In June, US-Mexico trade hit an all-time monthly high (US $57.1 billion). Mexico is still the US’ largest trade partner for the fifth month in a row. Total year-to-date trade as of June 2021 is up 32.17% compared to June 2020. However Canada has been growing its participation as a top destination for US exports considerably and is the second largest trade partner of the US by less than US $3 billion or 0.1% of total US trade. If this trend continues for the rest of the year, Canada might overtake Mexico as the largest trade partner in the coming months. China has been consistently losing its position as a top trade partner as their exports and imports to the US continue to contract.
•Mexico’s exports to the US in June (US $33.0 billion) recovered to the levels of March 2021 (US $33.3 billion) after a two-month decline in April and May. Mexican imports from the US hit an all-time high this month (US $24.1 billion) after a slight decrease in April. Mexican exports to the US grew 5.27% in June compared to May. Mexican imports from the US grew 5.85% compared to May and have continued to recover after a slight contraction of 4.04% between March and April. Both exports and imports are up more than 29% compared to June 2020 when the pandemic cut trade by more than half.
US-Mexico total trade 2021 (millions, USD)
Click here for AmCham’s Trade Dashboard English – Spanish
•Mexico is still the top trade partner of the US and Canada is the second. Total US-Mexico trade in 2021 equals US $320 billion or 14.7% of total US trade, which is still greater than Canada (US $317.1 billion) and China (US $300.7 billion). Canada has continued to grow its percentage of trade with the US for the second month in a row. The top 5 US trade partners are 1. Mexico, 2. Canada, 3. China, 4. Japan, and 5. Germany.
•As of June 2021, Mexico recovered marginally as a top export destination for US products compared to May 2021, from 15.8% to 15.9%. Canada’s participation as the leading importer of US goods improved again this month by 0.1% from 17.6% to 17.7%. US exports to China stayed the same this month after a three month decrease from 8.8% in February to 8.5%. As a result, both Mexico’s and Canada’s percent of total exports are higher than 2020.
•China is still the top source of US imports (17.2% of total), but its percentage has kept decreasing from 19.1% in January to 17.2% in June. Mexico’s position also decreased 0.1% while Canada was the only country in the top three that grew 0.2% this month (12.6%). The US increased its imports from Canada while decreasing its imports from China and Mexico.
•The top 5 US imports from Mexico in total value compared to June 2021 are (i) Vehicles, except Railway or Tramway (ii) Electric Machinery (iii) Nuclear Reactors, Boilers, Machinery (iv) Mineral Fuel, Oil (v) Mineral Fuel. In June 2021, most categories grew compared to May 2021. The three categories that grew the most were: (i) Footwear & Headgear 29.24% (ii) Live Animals & Animal Products (16.78%), and Raw Hides, Skins, Leathers & Furs (15.72%).
•The top 5 US exports to Mexico compared to July 2021 in total value were (i) Electric Machine (ii) Mineral Fuel, Oil, (iii) Nuclear Reactors, Boilers, Machinery, (iv) Plastic and Articles Thereof. , (v) Vehicles, except Railway or Tramway. During the same period, all of US export categories to Mexico also grew. The three types of products with the most growth compared to June 2021 were: (i) Footwear & Headgear (29.24%), (ii) Live Animals & Animal Products (16.78%), (iii) Raw Hides, Skins, Leathers & Furs (15.72%).
TAKEAWAY: Although US-Mexico trade has recovered strongly and hit an all-time high this year, US-Canada trade has also exhibited a strong performance as both Mexico and Canada are both still benefiting from the US continuing trade tensions with China. However, for the last two months, Canada has been reducing the gap with Mexico to be the US’ largest trade partner, driven by an increase in US imports from Canada. This trend might be worrisome for Mexico in the coming months if US exports to Mexico do not grow at the same rate. At the same time, a potential impact of Delta variant in key manufacturing cities such as Monterrey, Guadalajara, and Tijuana, could negatively impact Mexico’s position as US largest trading partner.
* Spotlight by José Burnes, AmCham/Mexico’s Trade & Investment Center Manager and Gaby Valdés, Trade & Investment Center Specialist. The American Chamber of Commerce of Mexico (AmCham/Mexico) seeks to facilitate commercial integration between Mexico and the US, build a favorable business environment, and contribute with proposals to consolidate Mexico’s competitiveness and development as a top destination for American investment. By connecting companies and sharing trends and market intelligence, its Trade & Investment Center boosts cross-border business. Twitter: @amchammexico
