Mexican imports of petroleum products from China and South Korea doubled between 2018 and 2019, and though the United States remains by far its largest supplier, Asian refiners have gained market share in the Central American country.
Last year, Mexico imported 20,000 barrels per day of gasoline from China, up over 50% versus the previous year, while flows from South Korea stood at 18,000 bpd, about three times higher than in 2018. While South Korea has delivered gasoline to Mexico in January, China is yet to discharge a cargo:
Rising exports from East Asia have been the result of increased refining capacity and particularly from China. While the spread of the coronavirus has reduced refinery runs in the last month, Chinese gasoline exports remain strong amid cratering domestic demand. South Korean exports of refined products, for their part, are so far stable.
Higher East Asian flows to Mexico come at a time when the country’s refining sector hits a low refining utilization rate of roughly 36.6%. Despite the growing influence of Chinese and South Korean refined product flows, the US is overwhelmingly the largest supplier of petroleum products to Mexico, accounting for 75% of the country’s total gasoline imports last year.
As Mexico imports more South Korean clean products, South Korean imports of Mexican crude have been on the rise – nearly doubling in 2019 versus the prior year. As Iranian barrels to South Korea have dropped, Mexican barrels have stepped up to fill the gap. Nonetheless, the US is still by far the largest importer of Mexican crude, accounting for over 50% of total flows.