Texas loses cross-border trade to New Mexico after Abbott inspections order

SANTA TERESA, N.M. — When Marco Grajeda stood up at a luncheon of El Paso and Juárez business leaders to tout increased trade at the Santa Teresa port of entry, he was nodding both to the strength of the regional “borderplex” economic model and to a trend that is playing in New Mexico’s favor.

Commercial cargo crossings at Santa Teresa have surged between 5% and 12%in the months since Texas Gov. Greg Abbott briefly ramped up state inspections, snarling international trade in a failed bid to crack down on drugs and migrants — neither of which pass in significant numbers through commercial lanes. Cargo crossings at El Paso’s two cargo bridges declined over the same period.

Experts say that while cross-border trade in southern New Mexico benefits the whole region in broad terms, Texas is losing tax revenue and new investment to its neighbor state as a result.

“We’ve always seen ourselves playing a supporting role for the region and really benefitting the ‘borderplex,’” said Grajeda, executive director of the New Mexico Border Authority, at his office near the Santa Teresa port of entry.

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That support took the form of triage when Abbott ordered the increased secondary inspections of cargo trucks by state troopers at Texas ports of entry in early April. Grajeda started fielding calls from panicked owners of trucking and logistics companies.

Could Santa Teresa extend its hours and relieve a bottleneck that was putting millions of dollars at risk by the hour?

“We worked with our partners to open on Saturday and clear the traffic,” he said. “We had huge lines.”

In an emailed response to questions, Abbott spokeswoman Renae Eze said "border governors are leading the way in solving border problems." She noted the governor negotiated "historic agreements" with the governors of four Mexican states bordering Texas to improve security. It's not clear whether any of the Mexican governors have taken action on the promised security improvements.

The Santa Teresa port of entry lies west of El Paso and south of Sunland Park.

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It’s the preferred crossing point for specific goods like the enormous wind turbine blades manufactured in Juárez and for goods produced in maquiladora assembly plants that lie farther south in Chihuahua, thanks to a road that allows trucks to bypass the Juárez metropolitan area.

After initially jumping 20% in April, cargo crossings at Santa Teresa have risen each month May through September compared to the same month during the prior year, according to Tom Fullerton, economist at the Border Region Modeling Project at the University of Texas at El Paso.

The Santa Teresa port of entry saw cargo crossings increase 11% in May, 5% in June and 12% each in July and August, Fullerton said. The gains amount to an increase of 600 to 1,600 trucks monthly.

Overall trade in the region has held steady after adjusting for inflation, he said, suggesting the traffic at Santa Teresa isn't new business but trade shifting from El Paso.

“Wherever the trade flows, that influences investments in other businesses like warehousing, logistics offices, truck stops and restaurants,” Fullerton said. “Those imaginary lines on the map influence where those tax revenues are accrued.”

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Miriam Kotkowski oversees about 100 truck crossings daily as president of Tecma Transportation Services, which ferries products between maquiladoras operating in Juárez and their warehousing or distribution locations on the U.S. side. Since April, the company has increasingly shifted cargo crossings to Santa Teresa, she said, and is growing its warehouse capacity, too.

The company uses all three ports of entry, Kotkowski said, but "our preference is Santa Teresa because it is fast and friendly, as well. We have established a distribution warehouse in Santa Teresa and we are growing with two more."

Northbound commercial wait times at Ysleta-Zaragoza have lately ranged from one to two hours; one to three hours at the Bridge of the Americas and from 30 minutes to an hour at Santa Teresa, she said.

Trucking and logistics company Capin-Vyborny moves agricultural products, climate-controlled candies and automotive parts that require just-in-time delivery from plants in Mexico to U.S. assembly lines.

Abbott's seven-day slowdown crushed those industries, as wait times at El Paso ports of entry surged from two to 12 hours in April, said Franz Felhaber, regional manager. Auto parts manufacturers in Mexico are just now feeling the pain of incurring tens of thousands of dollars in fines by the major U.S. auto manufacturers for late deliveries, he said.

The company has tried to diversify its use of area ports for roughly 125 truck crossings daily, shifting what commerce it can to Santa Teresa, Felhaber said. Many of the company's clients have warehouses on the Eastside of El Paso, he said, but New Mexico is planning to build a new road that will connect the Santa Teresa port to Loop 375, which could make connections easier. The state is funding a feasibility study.

"We are fortunate in El Paso that we have Santa Teresa," he said. "Now people are using it not as a backup but as the primary port. And I see it as an option for when there political mistakes, like the one Abbott committed in April."

Grajeda said the Santa Teresa port has room to expand still.

"I think we can accommodate still further growth," he said. "I think can we about about double what we are getting and keep the wait times still much faster than what we have in El Paso."

This article originally appeared on El Paso Times: After Greg Abbott's border inspections orders, Texas loses trade to NM