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Sept.18, 2017

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Paul Brady Photography / 34 THE JOURNAL OF COMMERCE SEPTEMBER 18.2017 SPECIAL REPORT INTERMODAL AS US, MEXICAN, and Canadian negotia- tors clash over the future of the North American Free Trade Agreement, truck- ing companies, railroads, and logistics providers are expanding facilities in Laredo, Texas, to combat congestion, equipment imbalances, and expedite shipments and vehicles at the border. The goal is to keep Laredo from becom - ing a cross-border chokepoint, rather than a gateway. US and Mexican officials in August dedicated a unified rail cargo processing facility in Laredo that may increase sig- nificantly the number of trains that can be processed daily at the border crossing. The facility, constructed by Kansas City Southern Railway, houses Mexican and US Customs officials, who will work col- laboratively, processing KCS and Union Pacific Railroad trains. The joint US-Mexican rail cargo processing facility should expedite north- bound trains carrying autos and auto parts, produce, and manufactured goods to the US, but also will help clear Mexico- bound trains, said Patrick J. Ottensmeyer, KCS president and CEO. "This project, and others to follow, are essential to facilitate the goal of expanding trade and particularly increasing exports of goods such as refined petroleum prod- ucts and petrochemicals from the United States to Mexico," he said, underscoring the importance of US energy exports to Mexico. Although the US had a $64.4 billion trade deficit in goods with Mexico in 2016, it had an $11.5 billion surplus in energy- related trade, owing to $20.2 billion in exports of refined petroleum and natural gas, according to US Energy Information Administration data. Mexican crude oil exported to the US increasingly is being refined and exported back to Mexico as fuel. Those exports, often delivered in tank cars, are meet- ing northbound carload and intermodal freight at Laredo, where about 23 trains a day are processed and cleared at the US border. Northbound rail traffic at Laredo is up 16.5 percent this year, US Customs and Border Protection said. Last year, the number of trains crossing the border into the US from Mexico at Laredo climbed 2.9 percent, and loaded rail containers were up 3.2 percent, US Bureau of Trans- portation Statistics data show. News reports suggested the number of trains crossing daily at Laredo could climb to more than 40 after the unified rail cargo processing facility is fully online. KCS said the facility already is improving freight flow across the border. "Eliminating stopping trains on the bridge would increase velocity and fluidity of train movements over the border, which is important for all stakeholders," KCS said in a statement. "Keeping trains moving increases security and throughput, while reducing traffic congestion within the city limits of Laredo and Nuevo Laredo." Laredo has experienced a boom in truck-related construction as well, with companies such as Werner Enterprises, Transplace, and Landstar System build- ing or expanding warehousing and cross- docking facilities this year. Rising freight volumes and an imbalance in northbound and southbound traffic encourages cross- docking. But the fragility of freight infrastruc- ture at the border was highlighted in May when the World Trade International Bridge linking Laredo with Nuevo Lar- edo, processing more than 12,000 cargo vehicles a day, was closed temporarily after being damaged by heavy rains and high winds Trucks had to be rerouted to the Laredo-Colombia Solidarity Interna- tional Bridge, 18 miles to the west, causing delays. JOC Contact William B. Cassidy at and follow him on Twitter: @wbcassidy _joc. By William B. Cassidy A new US-Mexican rail cargo processing facility will speed clearance of trains at Laredo SMOOTHING CARGO FLOW

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