Lookin' good

As we have crabbed before in this space, for the longest time it seemed like all you ever saw in the press about Mexico was nasty news about drug trafficking violence.  But at some point in 2012, it was like a new memo went out (and maybe one did), and all of a sudden stories started popping up about Mexico’s economic progress, bright future, and flashy manufacturing industries.  It’s not like our problems have gone away – they certainly have not – but it is nice to see something more positive in the media for once.  After a while we started collecting these stories to enjoy time and time again, so we thought we’d share them so that you can enjoy them as much as we have.

Go on, have a look.  Let’s savor our spell in the golden light of favor while it lasts:

MoneyWeek: Why you should be excited about Mexico

New York Times: Mexico: The New China

Forbes: For American Exporters, Mexico Is The China Next Door

City A.M.: Mexico and Indonesia to eclipse UK’s GDP by 2050

What Investment: Mexico tipped over Brazil for 2013

World Politics Review: At Long Last, Mexico’s Bright Future

Reuters: Credit Suisse bankers see iconic IPOs in Mexico next year

The Economist: From darkness, dawn

Nearshore Americas: Presidential Election is a Win for Mexico

Fox News (!): Study Ranks Mexico as World’s Fourth Best Investment Destination

Foreign Policy Blogs: Mexico’s Growing Middle Class

Wall Street Journal: The Next Emerging Tech Powerhouse: Latin America

Financial Times: Made in Mexico gains ground on China

Reuters: Mexico could pass Brazil as top LatAm economy in 10 years

MoneyMorning: Why Mexico’s Economy Could Be One of the Most Attractive Emerging Markets

The pace of growth of Mexico’s construction industry may have dived in the fourth quarter lat year, but the Mexican Construction Industry Chamber (CMIC) is feeling guardedly optimistic about the sector’s prospects going forward.

Mexico’s construction industry is among the country’s largest industries by value, contributing close to 7% of national GDP through mid-2012.   With an estimated value of US$83 billion in 2011, the sector is the sixth largest by contribution to GDP.   The industry was hit hard by the 2008-2009 recession and did not fully return to growth until late 2010.  After a period of fairly robust growth through 2011 and into early 2012, the pace of expansion slowed in the second half.

Nonetheless, the CMIC is projecting final sector growth of approximately 4.1% for 2012 and up to 5.7% in 2013.  The policies of the incoming government of President Enrique Peña Nieto, who took office on December 1, 2012, are expected to have a major impact on the performance of the sector over the next five years.  If areas such as housing and infrastructure are given priority and resources, the construction industry and its suppliers will benefit from a larger number of projects stimulating demand for materials, equipment and services.  As it is too early to foresee how strongly the new government will support construction, the CMIC is projecting annual growth rates through 2016 in the range of 3.8%, with the possibility that these could rise to 5-6% if the Peña government prioritizes infrastructure projects.

Although the new government’s final National Infrastructure Plan has not yet been presented, Communications and Transport (SCT) Minister Gerardo Ruíz Esparza has identified certain areas planned to receive particular attention.  Most of these focus on large scale transport and logistics projects such as airports, inter-city trains and ports, however Peña Nieto himself and others in his campaign previously have stated his intention to strengthen programs to develop low income housing.  In his inaugural address, the new president also stressed his intention to pursue increased private sector investment in infrastructure development through the recently instituted Law of Public–Private Associations (LAPP), intended to stimulate investment in public works.

In comments published recently on Mexican Business Web, CMIC president Luís Zárate projected that overall investment in construction during the six-year Peña administration could end up doubling that of the recently concluded Calderón government, with 60% of the total coming through LAPP investment.  Construction analysts Bimsa Reports presented a more guarded outlook in recent comments published in El Financiero, however, asserting that 85% of Mexican builders lack a working knowledge of the new LAPP legislation and regulations.  Bimsa asserts that the construction industry is likely to grow at a more moderate pace of 3.5% this year.

Interested in the Mexican market for building materials and equipment?  Drop us a line at info@bdp-americas.com

Information collected from media reports over the past month:

• Manufacturing: Spanish appliance manufacturer Fagor will invest US$3.5 million to expand capacity at its production plant in the central state of San Luís Potosí.  The project is aimed at boosting output of products such as refrigerators, dishwashers, ovens and other kitchen equipment. (Mexican Business Web, August 27, 2012)
• Logistics: Mexican rail operator Ferrocarril Mexicano (Ferromex) plans investment of approximately US$2.3 billion over the next five years to upgrade infrastructure to meet projected growth in demand for rail service.  Resources will be used to expand and improve track and freight terminals to handle expected demand growth from the automotive and mining sectors. (El Economista, August 26, 2012)
• Building materials: U.S. ceramic flooring manufacturer Daltile opened a new production facility in the central state of Guanajuato.  The US$65 million site becomes the company’s eighth manufacturing location in the country. (El Economista, September 4, 2012)
• Security: Brink’s Panamericano de México, Mexican affiliate of U.S. secure transport firm Brink’s, is projecting investment of US$30 million over the next three years for upgrades and expansion.  Plans include upgraded armored trucks and equipment, technology enhancements and training for personnel. (Mexican Business Web, September 7, 2012)
• Electronics: U.S. contract manufacturer Sigmatron inaugurated a new production facility in the northern state of Tijuana.  The US$2 million plant will produce electronic components for the medical, automotive and electronics industries. (Periódico Industrial Siglo XXI, September 11, 2012)
• Steel: Mexican steel pipe manufacturer Tubacero began construction on a new production plant in the northeastern state of Nuevo León.  Tubacero intends to produce high performance helical tubing at the US$90 million facility, the company reported. (Reforma, September 17, 2012)
• Solar energy:  Sonora80M, a consortium including Spanish investors, initiated construction of a large scale solar energy plant in the northern state of Sonora.  The US$75 million project will be built and maintained by Portuguese developer Martifer Solar and is planned to produce 20 MW of power initially and ramp up to a maximum of 80 MW. (Milenio, September 19, 2012)
• Automotive: German auto parts maker Marquardt inaugurated a new manufacturing plant in the central state of Guanajuato.  The US$50 million facility will produce ignition switches, electronic locks and other electrical parts for clients such as General Motors, Chrysler and BMW. (El Sol de León, September 26, 2012)
• Airports: Mexican low-cost air carrier Interjet will invest US$25 million to construct four new maintenance hangars at the Toluca International Airport, the company reported.  Interjet is currently upgrading its hangar at the Mexico City airport for an additional US$25 million. (Reforma, September 28, 2012)
• Automotive: Japanese multinational corporate group Hitachi announced construction of a new manufacturing plant in the central state of Queretaro.  The US$100 million facility is planned to produce suspension components for supply to automotive OEMs. (Hitachi, September 20, 2012)
• Aviation: U.S. aviation maintenance services provider Hawker Beechcraft, in a joint venture with Mexican executive air travel operator Aerolíneas Ejecutivas, opened a new repair and maintenance facility in the northeastern city of Monterrey.  The US$5 million service center will provide MRO services for airframes, power plants and avionics systems, as well as painting services for private jets. (El Financiero, September 28, 2012)

You need one of these

In recent years, The Mexican market for fashionable kitchen, tabletop and other products for the home has registered important growth in size and quality. The entry into the market by Wal-Mart in the late 1990s increased the prevalence of foreign products on store shelves in Mexico.  Wal-Mart’s aggressive expansion has also driven its top competitors such as Comercial Mexicana, Soriana and Chedraui to step up their game with greater variety and innovation in their product lines, including housewares.

Upscale department store chains such as Palacio de Hierro and Liverpool have long featured departments offering expensive lines of kitchen gadgets, tableware and home décor items in Mexico, as have stores such as Sears and Sanborns.  Regional department store chains such as Chapur in the southeast, Dorian’s in the northwest and La Marina in the central west also offer similar product lines.  An important new trend is the recent emergence of specialty stores exclusively focused on products for the home.

Read more about how Mexico’s growing middle class is driving new markets for consumer goods in our post for Mexico Today.

Setting trade policy?

In March 2012, Brazil insisted on putting artificial curbs on imports of Mexican-made automobiles, contrary to the long-standing pact governing vehicle trade between Mexico and the Mercosur trade bloc comprised of Brazil, Argentina, Paraguay and Uruguay.  We’re in a snit about this, because the move creates problems for Mexico and in general adds to the list of alarming actions coming out of Mercosur countries lately that are undermining the environment for trade and investment.

The Economic Complementation Agreement No. 55, known as ACE 55, was negotiated between Mexico and Mercosur in 2002 as a means of reducing tariffs on vehicles and auto parts to facilitate trade in these goods between the five countries.  It worked; automotive trade surged and the deal seemed to suit Brazil just fine as the South American giant racked up a trade surplus in cars with Mexico year after year. But the tide began to turn about three years ago, as Brazil’s strong currency and the relatively high cost of domestic manufacturing helped make Mexican cars cheaper relative to their locally made equivalents.   When Mexican automotive exports to Brazil jumped 70% in 2011, Brazil plotzed, threatening to abandon the ACE 55 protocol if Mexico didn’t accept forced reductions on its car sales to the country.  Mexico announced in March this year that it had agreed to limit the value of its automobile exports to Brazil to US$1.45 billion in 2012, US$1.56 billion in 2013 and US$1.64 billion the year after.  Considering Mexico’s car sales to Brazil exceeded US$2 billion in 2011, the curbs are substantial.  The revisions to the original agreement also include stipulations aimed at increasing the amount of auto parts Mexico’s vehicle manufacturing industry sources from Latin America.

According to the Mexican government, the export quotas will take effect for three years, after which they will be removed.  Nonetheless there are a number of aspects about this issue that we don’t like, for example:

• It suddenly throws the brakes, as it were, on a very thriving and growing market for a key Mexican export.  Mexican automotive exports to Brazil surpassed US$2 billion last year and are on a pace to blow by that mark this year, except that they will now be halted at the relatively paltry level of US$1.45 billion despite the high demand in Brazil.
• It creates an element of uncertainty in the previously strong growth trend in the overall demand for Mexico’s automotive output which has driven substantial direct foreign investment in the sector in recent years.  Foreign automotive manufacturers such as Honda and Nissan which have announced plans for major expansion in Mexico could potentially reconsider or scale back their investment plans if Mexico’s access to the Brazilian market is restricted.
• Brazil’s fair-weather attitude to its trade agreements casts a pall upon trade agreements in Latin America.  If one of the parties abides by the agreement only when the balance of trade is firmly in their favor, what is the point of negotiating an agreement?  Should Mexico and Peru now feel free to apply the same strategy to the FTA they signed last year?
• The bad-faith maneuver by Brazil effectively pulls the plug on exploration of a possible free trade agreement between Latin America’s two largest economies, at least for the foreseeable future.  During the past two years, the tantalizing possibility of such an agreement has been hotly discussed in Mexican media and preliminary explored between the two governments.  Numerous representatives of Mexican industry have expressed trepidation over the idea, due to lack of confidence in Brazil’s commitment to a level playing field.  Now, it will be harder than ever to dispute these claims.

Brazil’s President Dilma Rousseff is scrambling to boost GDP growth while the country’s currency continues to appreciate internationally.  Emergency measures such as capping imports may appease certain industry sectors, but – much like recent nationalizations of foreign industrial holdings in Argentina and Bolivia – shoring up political problems at home may come at a cost to the country’s reputation among trade and investment partners in the future.  We don’t think it’s good for Brazil in the long run, and it sure doesn’t look good for Mexico in the short run.

Information collected from media reports over the past month:

• Aerospace: American aircraft maker Hawker Beechcraft is joining forces with Mexican executive jet operator Aerolineas Executivas to build a new maintenance facility to serve private aircraft in the northeastern city of Monterrey.  The US$2.2 million project is planned to provide repair and painting services in the country’s second largest private aviation hub. (El Financiero, January 2, 2012)
• Automotive: Japan-based Nissan Motor Co. is preparing plans to build a new automobile factory in Mexico.  The new facility will add production capacity to the company’s two existing plants in Mexico which currently have capacity to produce over 700,000 vehicles a year. (Wall Street Journal, January 6, 2012)
• Automotive: Japanese automaker Nissan announced it will construct a new vehicle assembly plant in the central state of Aguascalientes at an estimated cost of US$2 billion.  The large-scale plan includes a supplier park nearby the new manufacturing facility, which will become Nissan’s third in Mexico. (Autoweek, January 25, 2012)
• Aviation: European aerospace manufacturer Airbus announced an order from Mexican airline Volaris for the purchase of 44 new A320Neo and A320 aircraft. The total value of the deal, planned for delivery 2015 – 2020, was estimated at approximately US$4 billion. (AFP, January 12, 2012)
• Aviation: U.S.-based aerospace manufacturer Hawker Beechcraft announced the sale of six new T-6C+ training aircraft to the Mexican Air Force, with the possibility of additional future orders.  The value of the deal was not specified. (Defense Media Network, January 11, 2012)
• Electricity: German electronics and electrical engineering giant Siemans inaugurated a Low Voltage Research and Development Center near the northeastern city of Monterrey. The company invested approximately US$22 million in the new facility, which will help to develop high efficiency electrical systems for Siemens products. (Reforma, January 13, 2012)
• Retail: Mexican grocery and general merchandise retailer Soriana announced plans to open 50 new sales locations in the country this year.  The company currently operates 558 stores across its five formats. (Reforma, January 16, 2012)
• Logistics: The Mexican affiliate of Philippines-based International Container Terminal Services Inc. (ICTSI) has begun construction on a new container handling terminal at the Pacific port of Manzanillo.  The new facility will require investment of US$250 million.  (Maquila Portal, January 17, 2012)
• Manufacturing: U.S. based safety systems manufacturer IMMI will install a new production plant in the northern city of Coahuila.  The US$49 million facility will produce safety equipment for fire trucks, helicopters, ambulances and other applications. (El Diario de Coahuila, January 13, 2012)
• Aerospace: U.S.-based aerospace manufacturer Ducommun will invest US$6.6 million in machinery and other equipment to upgrade its factory at Guaymas, in the northwestern state of Sonora.  The project includes construction of a new industrial building at the facility, which provides electro-mechanical, sheet metal and composite assembly services. (NAFTA Works, January 2012)
• Logistics: U.S.-based rail carrier Kansas City Southern inaugurated a new rail freight handling terminal in the central State of Mexico.  Built at a cost of US$2.1 million, the terminal is equipped to handle a large volume of liquid cargo. (Info-Transportes, January 20, 2012)
• Aviation: Mexican airlines are projected to acquire 27 new aircraft in 2012, according to financial services firm Actinver.  Airlines expected to add to their fleets include Aeromexico, Interjet, Volaris and VivaAerobus. (Reforma, January 23, 2012)
• Retail: U.S.-based coffee shop chain Starbucks plans to invest US$25 million this year to open 50 additional locations in Mexico, the company reported.  Starbucks projects 24% growth in total Mexico sales this year, based in part on the country’s rising per capita coffee consumption. (El Financiero, January 24, 2012)
• Energy: Spanish bank Banco Santander will provide capital to build four wind farms in northern Mexico, in partnership with German wind energy developer SoWiTec.  The sites, to be built in the states of Nuevo León, San Luís Potosí and Coahuila represent combined capacity of 650 – 850 MW.  The amount of investment was not specified. (Milenio, January 23, 2012)
• Plastics: U.S.-based injection molding firm Century Mold Co. announced plans to build a new production plant in the central state of Queretaro.  The US$15 million facility will supply Tier 1 automotive component manufacturers in the region. (Plastics News, January 17, 2012)
• Retail: Mexican fast food franchise operator Alsea will open an additional 100 locations across its eight brands this year, the company announced.  Brands operated by Alsea in Mexico include Starbucks, Burger King, Chili’s and Domino’s Pizza, among others. (Reforma, January 26, 2012)
• Food processing: The Mexican affiliate of U.S.-based food processing giant Kraft Foods re-inaugurated its research and development center in Mexico City at a cost of US$50 million in technology and skilled staff.  The facility carries out research to improve the quality and development time for new products. (Reforma, January 26, 2012)

Clear path to business startup

Driven by a desire to stimulate employment and the internal market, as well as to scale the World Bank’s “Ease of Doing Business” rankings, the Mexican government approved a package of reforms in December 2011 aimed at facilitating the creation of new businesses.  The modifications, which affect laws such as the Foreign Investment Law, the General Law of Mercantile Societies, the Public Administration Law and others, are intended to reduce the time, cost and aggravation of registering a new company.  Some of the changes entered into effect as of January 1, 2012, and others will become operational as of June of this year.

Taken as a package, the reforms seek to concentrate the required procedures for forming a business within the Economy Ministry (SE), instead of having them distributed throughout various government agencies, each with their own offices, forms, procedures and fees.  The official reform decree also calls upon the SE to coordinate the harmonization of procedures across agencies and incorporate the overall process into a unified digital registration system, via the web portal www.tuempresa.gob.mx.  Examples of the regulatory modifications include:

•    Reduction of obligatory response time for new business approval applications
•    Elimination of fixed amount of initial share capital
•    Elimination of various fees from new business application process
•    Removal of requirement to establish a fixed duration for registered companies

The reforms are more incremental than revolutionary, but very welcome just the same.  Having hacked our way through a dense forest of procedures and fees to register our own companies in years past, we commend the current administration’s efforts to simplify the process for entrepreneurs.  To a similar end, the Federal Regulatory Improvement Commission (Cofemer) will be undertaking throughout the year a comprehensive examination of federal regulations and procedures to evaluate their cost-benefit efficiency.  The program, conducted with support from the Organization for Economic Cooperation and Development (OECD), seeks to implement best practices and harmonize systems at all levels of government with the lofty goal of reducing the overall cost of regulation to the economy by 25%.  Fun dayn moyl in gots oyern, we say!

With mere months remaining in his administration, we imagine President Felipe Calderon would be well chuffed to achieve an uptick in Mexico’s Ease of Doing Business ranking.  Even though we’re still *cough* 73 positions ahead of Brazil, there’s still plenty of room for improvement.

The decree detailing the new-business reforms can be found here.

As another year comes to a close we can’t help feeling some frustration that the economy just doesn’t seem to want to take off, both around the world and here in Mexico.  Between the Eurozone debt crisis and stubborn unemployment in the United States, among other topics, we’ve got plenty to keep us fretting for the foreseeable future.  But since the holidays are upon us and presumably it’s a time for good cheer, here are some of the talking points we’ll have in our pocket as we hit the punch bowl hard in the coming days:

GDP growth: Banco de México and Banamex are projecting final 2011 GDP growth in the range of 3.8%.  OK we’re not talking China numbers here but compared to 2009’s -6.1 we’ll take it.

Hot industries: While most sectors of the economy are merely shuffling along, certain industries are getting, or remaining, seriously hot.  The big star this past year was automotive manufacturing, which after suffering a rough patch during the recession has roared back, with production and exports well up over 2010 and a number of significant new investments announced.  Aerospace manufacturing also continued its unchecked expansion, with new international investments announced and exports projected to post double-digit growth for the year.  Outside of manufacturing, mining surged this year, led by demand for gold, silver, copper and industrial minerals, and is on track to exceed 2010’s record setting production value for the year.

Renewable energy: In the energy industry, 2011 saw continued high interest in renewables, with major new investments in a variety of alternative energy sources.  New wind power generation plans were announced not only in Oaxaca, site of the largest wind developments, but also in northern states such as Zacatecas and Baja California and far south eastern Quintana Roo.  Interest in solar electricity generation appeared to surge as well, with a range of projects announced for manufacturing sites, corporations, municipal lighting and rural electrification, among others.  The growth in demand for solar panels is helping drive expansion of domestic photovoltaic equipment manufacturing.

Agriculture: The agriculture and livestock sector faced a severe challenge this year with devastating drought conditions in various northern states.  A bright spot, nonetheless, is the growing diversification of exports such as meat.  Mexican beef has found a new market in Russia, to which exports of frozen beef surged this year, and exports of pork to China and Japan are expected to rise in 2012 following recent regulatory moves.  Chinese authorities have certified a number of Mexican pork packing plants to export to the Asian giant in 2012, while Japan recently agreed to increase quotas for imported Mexican pork, as well as beef and chicken, beginning next year.

Read about our participation in the Mexico Today program here.

Clear path to growth

Mexico’s biotechnology industry made an international splash this year when a biopharmaceutical treatment for scorpion stings developed in Mexico was approved for sale in the United States by the U.S. Food and Drug Administration (FDA).  The product, called Anascorp, was developed by the Biotechnology Institute of the National Autonomous University of Mexico (UNAM) and is manufactured by Mexico City-based laboratory Instituto Bioclon.  It is reportedly the first antidote of its type specifically for potentially lethal scorpion stings to be available on the U.S. market.

While Anascorp captured headlines, Mexico has quietly been building up its biotechnology industry in recent years.  Sporadic projects to develop hardier agricultural varieties began in the late 1980s, and since have grown into a concerted effort by government and academia to promote biotechnological research and development in support of industry.  Much attention has been given to the field as part of recent administrations’ drive to build Mexico’s international competitiveness in advanced industries such as aerospace, software and pharmaceutical manufacturing.  The majority of resources currently dedicated to biotechnological research in Mexico are reported to be concentrated in the development of pharmaceuticals, with agriculture and energy applications also receiving significant attention.  The Mexican Economy Ministry estimates the domestic market for products of biotechnological origin to be approximately US$1 billion with strong growth potential.

Federal and state governments are now seeking to replicate the success of the country’s aerospace industry by promoting incentivized biotechnology clusters in certain locations.  The government of the central state of Morelos, for example, is investing US$25 million in a new science and technology park in the city of Cuernavaca specifically targeting producers of biopharmaceuticals.  The government is offering tax breaks and other incentives plus the existence of other biotech companies in the city to build an industry concentration that will gather momentum to continue expanding on its own.

The western state of Jalisco is taking a slightly different approach with its recently formed Biocluster de Occidente.   The initiative, launched through an alliance between a local university, a regional manufacturing chamber and a state research and technology agency, will provide resources and logistical support to organize workshops, conferences and networking events to develop linkages between academia, government and industry.  The objective is to generate collaboration across the sectors to support industrial competitiveness and entrepreneurship that will create economic growth.  The project will reportedly begin working with 37 area companies in industries such as food science and human and animal health technologies.

The northeastern state of Monterrey, in turn, is pursuing its own biotechnology cluster focused primarily on the agriculture and food processing industries.  The state’s Cluster Agroalimentario de Nuevo León launched last year to put government and research organizations’ resources in the service of area agribusiness operations such as those in the citrus industry.  The cluster committee is currently conducting a campaign to recruit new companies from around the world to join the existing core group.

Despite an adverse economy, Mexico’s biotechnology community continues to grow.  Mexican pharmaceutical manufacturer Landsteiner Scientific recently announced planned investment of US$45 million in research to develop biopharmaceuticals for treatment of cancer and chronic degenerative diseases in conjunction with the Monterrey Technical Institute and the University of Michoacán.  Another Mexican firm, Biosustenta, this year inaugurated a plant to produce environmentally friendly biofertilizers.  The facility, built with federal and state support, is reportedly the largest of its kind in Latin America.  This past October, German pharmaceutical producer Boehringer Ingelheim joined Jalisco’s biotechnology community, inaugurating a plant develop and manufacture vaccines for poultry and other livestock.

The rise in importance of biotechnology has brought with it an effort to update regulatory frameworks to keep pace with an evolving industry.  On October 19, 2011, Mexico’s Official Gazette (DOF) published modifications to existing regulations governing health products that specifically addressed biopharmaceuticals.  The updated legislation includes key provisions on registration of generic biopharmaceuticals once the original developer’s patent expires.  The new regulations establish the process for registration of generics and time frame within which manufacturers may register their products for testing prior to the expiration of an existing drug’s patent.

For the full text of the reforms to the Health Products Law, go here.

Read about our participation in the Mexico Today program here.

Buried treasure

Despite a mopey world economy that just can’t seem to snap out of it, Mexico’s mining industry looks to be headed for another banner year in 2011.  The Mexican Mining Chamber (Camimex) reported a record high of US$13.9 billion in production value for 2010, leading the sector to outstrip tourism among the country’s leading industries.  The current year is expected to exceed last year’s performance, with growth through the first half set at over 17% and still on pace through August, according to the National Statistics Institute (INEGI).  High demand for precious metals and certain industrial minerals has in turn led to a flurry of investment that should keep production strong for the foreseeable future.  Camimex is projecting total mining sector investment of US$4.7 billion for 2011, which would represent a healthy 42% increase from 2010 levels.

While a number of extractive products are performing strongly, gold may well be the star of the show.  With jitters over European debt and an unstable dollar sending investors scrambling, demand for gold on world markets sent prices soaring through the summer of 2011.  Gold producers in Mexico moved quickly to increase output, resulting in a 41% increase in production in 2010 over the previous year and further growth of 14% through the first half of 2011.  Since 2005, Mexican gold production by weight has increased by a torrid 139%, according to INEGI figures.  While still not among the world’s top producers, Mexico has advanced several positions in recent years and Camimex is now claiming 11th place for Mexico in world gold production.

Other key metals have contributed to Mexico’s mining boom as well.  Rising copper prices from 2009 through 2011 coincided with increased production to drive revenues and profits for Mexican copper producers.  Copper output through the first half of 2011 was 60% ahead of last year, according to INEGI.  Mexico regained the lead in world silver production in 2010 with production of 128 million ounces, according to the Silver Institute, with strong prices driving the development of new production sites.

In addition to splashy metals such as gold and silver, lesser known elements with important industrial applications such as fluorite, bismuth and molybdenum are quietly driving revenue growth for both domestic and foreign mining concerns in Mexico.  Fluorite in particular has been instrumental in the vertiginous growth of chemicals and plastics multinational Mexichem.  Mexico City-based Mexichem operates what they claim to be the largest single fluorite mine in the world in the northeastern state of San Luis Potosí, helping make Mexico the second largest producer of the mineral after China.  Across its range of products, Mexichem operates 95 production plants in 19 countries, and reportedly plans to launch new plants in Japan and Korea by the end of 2012.

Read about our participation in the Mexico Today program here.