The Union Blockade and Mexico—Part 2

By Caroline Davis—part two

William H. Seward
William H. Seward

The Union Blockade had begun to move inland up the Rio Grande by 1864, thwarting trade across the river. One would expect negative repercussions with the closing of this important trade route, but the Confederacy was never a primary benefactor in the relationship. In all actuality, the Matamoros Trade was more of a benefit to Mexico than to the southern United US. The small portion of West Texas that traded with Mexico before 1864 was the only Confederate area to directly reap the benefits. The sheer amount of travel required for goods to make it to the Rio Grande ate up most profits. Supplies coming in from the Matamoros Trade had to travel over 500 miles by wagon to reach the Texas-Louisiana border.

In the late 1850s and early 1860s, Mexico was developing its own cotton industry in addition to trading cotton with the Confederacy. This Central American country began growing cotton at a vital time. Prior to the war, the Union began developing its textile industry – specifically in New England. Northern textile manufactures had depended on southern cotton farmers to provide them with the raw materials needed to keep the textile industry afloat. The Civil War not only meant the death of the southern cotton industry but also threatened the New England textile industry. As a result, New England turned to Europe to buy the raw cotton needed. The New England textile industry suffered greatly in this newer, more competitive market due to its distance from the cotton-producing nations of India and Egypt. When Mexico began to grow cotton, New England saw an opportunity to combat some of the negative ramifications that had arisen from the laws banning trade between the Union and the Confederacy. Stepping up to the plate, Mexico began providing cotton to New England, helping to ease the effects of the “cotton famine.”

By the time the Civil War ended, the amount of trade between the Union and Mexico had increased fivefold.  According to the US Department of Commerce, 1860 showed a total of seven million dollars worth of imports and exports between the US and Mexico. There was a dip in 1861 and 1862, but in 1963 the amount skyrocketed to 12 million – and was at 22.6 million by the war’s end![i] This rapid increase in trade was due to the growth of Mexico’s raw cotton industry. The New England textile industry was in dire need of cotton by 1863. Maximilian I seized this opportunity to strengthen Mexico’s weak economy by taking advantage of the world’s provisional cotton shortage.

Mexico had been producing a small amount of cotton since the time of pre-Columbian Indian cultures, but production had remained incredibly low until the 1850 and 1860’s. As early as 1861, Mexican newspapers included cotton-growing tips and began devoting entire sections to the effects of the blockade. There were also textile industries in Mexico, but the continuing guerrilla warfare between Maximilian I’s newly-established government and the liberal party made domestic trading difficult.

In order to aid Mexico’s expanding cotton industry, the US began to export cotton gins to Mexico. Schoonover sites a rare letter from Lewis S. Ely to William H. Seward in which Ely states cotton-related machinery was one of the largest exports from the US to Acapulco and that, as an import, raw cotton was becoming increasingly more important to the U.S. Schoonover writes, “…in the export year ending on 30 September 1863, Ely reported that 7,095 bales or 1,036,444 pounds of cotton worth $209,475.44 had been shipped to the United States from Guerrero.”[ii] Information about the amount of cotton grown in Mexico at that the time is as Schoonover says “often scattered and incomplete.”[iii] However, data provided by the US combined with the little information that has been unearthed shows that the Mexican economy benefited from the new trade relations established due to the blockade and the laws banning domestic trade between the Union and the Confederacy.


Unfortunately for Mexico, the high increase of trade to New England would eventually end. When trade between the northern textile manufacturers and the southern cotton farmers reopened in the spring of 1865, cotton was once again supplied domestically. Exports from New England to Mexico slowed to a crawl. With the southern states in complete disarray, nearly all provisions and money went to help rebuild the South’s damaged infrastructure. By 1870, the annual value of goods traded between the US and Mexico had dropped to 8.6 million dollars. [iv]However, not all was lost for Mexico. The blockade and trade with New England had helped to establish Mexico’s presence on the global cotton market. So even though trade slowed and the Mexican economy suffered slightly after the end of the Civil War (and the blockade), the country was able to partially depend on its improved cotton industry to keep their economy strong.

Increased trade between Mexico and Texas is an interesting and often ignored result of the Union Blockade. Consider how differently the blockade affected Mexico than it did other countries. Despite the violence and disorder, Mexico developed a raw cotton industry –this industry brought revenue into Mexico and helped to stabilize both the country’s government and economy. England and France, who had once depended on the South for cotton, had to find new suppliers. Egypt and India quickly stepped up and took on the role in the cotton market once played by the Confederacy. Essentially, the only change for those living in Europe was the source of the cotton. Simply put, the blockade helped – or perhaps even forced –Mexico to establish itself as a contender on the global cotton market.


[i] Taken from the United States Department of Commerce as stated in: Schoonover, Mexican Cotton and the American Civil War. 430.
[ii] Schoonover, Mexican Cotton and the American Civil War. 434
[iii] Schoonover, Mexican Cotton and the American Civil War. 435.
[iv] Schoonover, Mexican Cotton and the American Civil War.  (Taken from the United States Department of Commerce) 430.

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