Issue #12: Produce from Mexico

Walking through a grocery store, you'll find a ton of brands with products made in Mexico. When it comes to the produce section, most of what you pick up will have a Mexico label on it.

Post-Manifest Thoughts

This year was my first time attending Manifest and experiencing conference life in Las Vegas. There were positives to it being in Vegas, like U2 at the Sphere, but things were incredibly spread out when it came to the Happy Hours and hotels, while seeing a mix of people attending Manifest, people attending a roofing conference, and those who were getting ready for the Super Bowl.

It was great seeing so many people focused on advancing innovation and technology in supply chain in logistics, from the founders and startups focused on building that technology to the investors who back those startups. Leaders of some of the biggest companies in the space were in attendance and it was quite the networking event. Also, did I mention U2 at the Sphere rocked?

As I continue to write this newsletter, I’ll be blending some content between Mexico, supply chain and logistics technology, and building Cargado. If there are any specific topics you’re interested in learning more about, respond to this newsletter or send me a DM on X/Twitter or LinkedIn.

A Produce Deep Dive

Cross-border refrigerated freight has its own market dynamics and different imbalance challenges than dry van freight. With the Kansas City Chiefs winning the Super Bowl, we’re officially into the start of produce season. The Super Bowl is the unofficial kickoff (pun intended) of produce season, with Super Bowl Sunday representing the largest consumption day for avocados. Avocados ship out of Michoacán and Estado México, with 92% of that volume coming out of Michoacán specifically, according to Avocados from Mexico. Given the perfect weather conditions in southwestern Mexico, avocados are able to be grown and harvested year round, providing for consistent availability.

Mexico represents 51% of US imports of fresh fruits and 69% of U.S. imports of fresh vegetables. Just walk around your local grocery store and you’re likely to find a significant amount of produce came from Mexico. Let’s take a look at some of the largest categories of produce that are shipped from Mexico to the United States:

• Avocados - $1.9B in export value, avocados represent the single most valuable fruit exported from Mexico. The majority ships out of Michoacán and ships year-round with the bulk of it starting in February and continuing through the summer.

• Bell Peppers - $600M in export value, with most coming out of Sinaloa and crossing through Nogales.

• Berries - $2.6B in export value (+7.2% growth from 2022 to 2023). Primarily grown in Jalisco and Michoacán, they represent just under 5% of Mexico’s overall fruit production. This includes strawberries, blackberries, raspberries, and blueberries.

• Cucumbers - $244M in export value, with most volume coming out of Sinaloa, like bell peppers. This fruit also crosses through Nogales, primarily, for distribution throughout the United States.

• Limes - 92% of limes imported into the United States come from Mexico, where most are grown in Veracruz, Michoacán, and Colima, crossing through Laredo and Pharr TX into the United States.

• Peppers - $1B in export value, primarily grown in Chihuahua, Sonora, and Zacetecas, chili peppers see their peak volume shipping in September, October, and November, crossing through Nogales, El Paso, and Laredo into the United States.

• Tomatoes - $2.1B in export value, tomatoes are the most valuable vegetable exported from Mexico to the United States. They are primarily grown in Sinaloa and San Luis Potosi but benefit from vertically integrated greenhouses and can ship year round.

This is just a select list of commodities that fall under the produce category that ship out of Mexico. Over $18B worth of fruit and vegetables were exported from Mexico to the United States in 2023. All of this represents a significant portion of the refrigerated and frozen freight that ships out of Mexico. The other products that require temperature control out of Mexico include frozen and prepared foods, chocolate, dairy products, some beverages, pharmaceuticals, and flowers and plants.

Interestingly, when produce season slows down, refrigerated carriers tend to have more southbound freight than northbound, as they haul meat and chicken southbound, with a lot of that product headed to resort areas of Mexico like Cancun, Riviera Maya, Los Cabos, Puerto Vallarta, and Acapulco. While carriers with dry vans tend to have more northbound than southbound volume for most of the year, it flips for refrigerated carriers during the slow months, part of Q4 and most of Q1.

Building in Public

We’re about three months into actively building Cargado since the team started in mid-November and I was lucky enough to visit Laredo recently and start introducing part of our product to our first set of users. While we ran into a bug or two occasionally, the team jumped in quickly to squash them and were communicating directly via WhatsApp with those who needed assistance. We’re excited to help bring cross-border Mexico freight online and enable everyone involved in the process to collaborate more effectively.

If you’re interested in learning more about Cargado, you can sign up for our waitlist at cargado.com. We’re building tools for everyone involved in freight moving across the U.S.-Mexico border and look forward to sharing more soon!