Hauling cargo from Central America or the Caribbean is relatively easy, but ship space is tight in the U.S. outbound trade to the region, and moving goods through many of the ports in the region can be challenging.
Those issues gain in significance because of the growth in volume expected from the Central America Free Trade Agreement, but shipping interests seem confident that carriers and ports can keep pace. "My instinct tells me that it's not surges but incremental growth," said Stephen Lamar, executive vice president of the American Apparel and Footwear Association, an industry group that lobbied hard for U.S. participation in CAFTA. The U.S. trade pact is composed of five Central American nations and the Dominican Republic.
The growth is noticeable in the textile and apparels sector. Lamar said the volume of apparel and textile imports into the U.S. from CAFTA trade partners between January and April increased nearly 4 percent from the year-earlier period, while global imports of those commodities into the U.S. declined 3 percent. And while the volume of U.S. yarn exports during the period rose by just under 2 percent, traffic to CAFTA partners shot up 36 percent, he said.
Obviously, trade in other product lines can be expected to increase similarly as CAFTA is implemented and tariffs diminish or disappear, Lamar said.
"There is a shortage of capacity outbound. The Caribbean is certainly not immune to it," said John W. James, president of John S. James Co., which provides a variety of freight-related services. Capacity is ample out of southern Florida, however, because several small carriers provide barge services into Miami and Port Everglades, he said.
Brisk import traffic into Savannah, Ga., where James's company is based, makes for a ready supply of containers for southbound shipments, though trying to locate a box inland can be difficult, James said.
"If you go with a big (carrier), you might have a problem. If you choose a line that operates in the (Savannah) area, they'll put the containers where you need them," he said.
There's plenty of competition for oceanborne shipments, said Charlie Dominguez, vice president of sales in Crowley Maritime Corp.'s Latin America division. "There are quite a few competitors of all sizes and shapes," he said. Crowley's niche is fast delivery to manufacturers in the Caribbean and Central America region, mainly with roll-on, roll-off vessels carrying trailers.
Financial strains are making it difficult for many Central American countries to expand and modernize their ports, Dominguez said.
"The ports need new cranes and comfortable marshaling yards, and they're all aware of it," he said. But the countries have other needs and devote their resources to more politically popular projects, such as airports, that have greater visibility among their citizens, he said.
Underscoring the port investment need was a June 22 incident at the Port of Belize. The crane that loads and offloads cargo ships at the port broke down, leaving the Carib Mariner with half of its freight still onboard, according to newspaper reports.
A backup crane reportedly was not available, so the ship stayed in port for 36 hours. With no solutions available at the time, Caribbean Shipping, the agent for the Mariner, decided to cut its losses and sail -- leaving half the cargo bound for Belize on the ship. Everything that was due for export, including much of the papayas destined for Miami, was left on the dock.
Reynaldo Guerrero, chief operating officer at the Port of Belize, told local reporters that the company was aware of the urgency and had dispatched an employee to Miami to locate a replacement repair part for the crane.
Belize's sovereign port normally has a backup crane provided by Lopez Equipment. But Lopez's cranes were out of the city working other jobs at the time.
The region needs investment to drive employment and to supply people with basic needs -- food, water, shelter and electricity, Dominguez said.
"As the trade starts to grow, the ports have to deal with their infrastructure problems -- the roads in and out of the ports, dredging, cranes, security issues," Lamar said. He added that there is equal pressure to boost other resources such as telecommunications.
While CAFTA is aimed at borderless trade among the participants -- Guatemala, Honduras, Nicaragua, Costa Rica, El Salvador and the Dominican Republic -- poor overland infrastructure in Central America is likely to keep north-south intra-regional cargo on the water, Dominguez said. There is no rail to speak of, and the Pan American Highway is mostly a two-lane road, he said. It hugs the Pacific Coast and becomes badly congested during harvest seasons, Dominguez said.
There are some bright spots among the region's ports, he said. Panama has world-class facilities at Balboa, Colon and Manzanillo, and a new port at Cutuco, El Salvador, is due to open shortly, he said. Crane additions, yard expansions and other improvements are in progress at Puerto Cortes, Honduras, he said.
Improvement projects are needed at Puerto Limon, Costa Rica, but are unlikely to happen soon, he said. The dockworkers' union there is fighting a government effort to privatize the port, and no improvements will occur until the matter is resolved and with it the question of who would pay for the work, he said.
Productivity at the container ports called by Crowley vessels is "acceptable, within reason and competitive. They do 25 and sometimes 30 picks an hour," Dominguez said.
All the ports in the region have beefed up security; Puerto Cortes is the first Latin American port to be certified for participation in the Customs-Trade Partnership Against Terrorism, the supply-chain security program established by the U.S. after the Sept. 11 terrorist attacks.
Dominguez said he doesn't foresee any major changes to shipping patterns once expansion of the Panama Canal is completed. What he does envision, he said, is "a very large enhancement to what is already going on," especially in distribution and feeder activity radiating both north and south.
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