Gulf Coast ports have long been underserved in the main east-west trades, but are counting on their access to the Midwest and the South’s growing population to attract new carrier services.
Houston, Tampa and Mobile have joined forces in a marketing initiative called the Gulf Coast Advantage. Houston and Tampa have huge populations — Tampa includes the tens of millions of tourists who visit Florida each year — while Mobile serves a growing industrial base.
“We have three strong distinct markets that wouldn’t compete against each other; we just complement one another,” said John Moseley, the Port of Houston Authority’s general manager for trade development.
Mobile and Tampa are newcomers to the container trade, while Houston ranks eighth among the nation’s container ports, according to PIERS, a sister company of The Journal of Commerce. But Houston could easily vault past Oakland, Virginia and Seattle into fifth place — it trailed fifth-ranked Oakland by less than 150,000 TEUs last year, according to PIERS.
New Orleans is in 16th place for container traffic, but its box traffic grew 21.5 percent last year — a bigger rise than any other port in the PIERS top 25 except for Seattle, where volume jumped 32 percent.
“Houston is really well-positioned, because they have the local market with Houston, Dallas and San Antonio, plus Mexico and the Midwest. The area has great potential because of the population, distribution centers and rail connectivity,” port consultant John Martin said.
The port’s hinterland stretches from the Mississippi River in the east to the Rocky Mountains in the west, Moseley said. But for trade with South America, “our market extends to the West Coast.”
Houston has fabulous rail connections, with 96 intermodal trains in and out each week, and 16 of those 96 are between Chicago and Houston, according to Moseley. Four of those 16 are express trains, with no stops along the way, he said.
Trains can reach Chicago in four days, Memphis in three days and St. Louis and Kansas City in two days, Moseley said. The rail service is provided by BNSF and Union Pacific, whose routes extend from California to the Mississippi, and Kansas City Southern. Through its wholly owned Mexican affiliate, its network extends from southern Mexico to Minneapolis, where it interchanges with Canadian National Railway. KCS also owns 50 percent of the Panama Canal Railway.
Asia is Houston’s biggest trade partner, accounting for 30 percent of its import containers, up from just 8 percent in 2000. Moseley said the port expects 10 to 15 percent growth after the completion of the Panama Canal.
Houston’s population and its role as a gateway to the nation’s midsection attracted a 4 million-square-foot Wal-Mart distribution center, the world’s largest, Moseley said.
But the port’s location also poses the biggest challenge to its future growth. The port is 50 miles from the sea, and while the Houston Ship Channel is 45 feet deep, it must be maintained and improved constantly. Getting federal funds for that purpose “is an ongoing battle, as with every port across the country,” Moseley said.
That geographical disadvantage provides an opportunity for Galveston. Its port facilities are just 9.3 miles from the open sea, or 30 minutes sailing time, according to its Web site. The Galveston Channel is 1,200 feet wide at its narrowest point — more than twice the 530-foot authorized width for the Houston Ship Channel — and provides direct access to the Gulf of Mexico. Galveston, which has been described as the best natural harbor in Texas, has an authorized minimum depth of 40 feet — not bad, but not deep enough to accommodate the biggest ships. Nor does it have any container services at present.
New Orleans’ strong suit has always been its location at the mouth of the Mississippi River. About 500 million tons of cargo, including chemicals, coal, timber, iron, steel and more than half of the nation’s grain exports, move up and down the river each year, according to the port. The 14,500-mile inland waterway system allows New Orleans to serve as an entree to markets such as Sioux City, Iowa; St. Louis; Tulsa, Okla.; Nashville, Tenn.; Chicago; Minneapolis and Pittsburgh.
New Orleans also has excellent rail service. Six Class I railroads — UP, BNSF, CSX, Norfolk Southern, Kansas City Southern and Canadian National — serve the Crescent City. The port has an intermodal railyard on property adjacent to the Napoleon Avenue Container Terminal that it purchased from the old Illinois Central in 2007. The short line New Orleans Public Belt Railroad connects the intermodal yard to the trunk line railroads.
The Napoleon Avenue terminal will add two new gantry cranes by September, bringing the total to six. Five additional acres of marshaling yard at the terminal are expected to be ready by October, port spokesman Chris Bonura said.
Mobile entered the competition for container cargoes when the Mobile Container Terminal, run by APM Terminals, opened in 2008. Volume last year totaled 130,000 TEUs, but the port is hopeful a new intermodal container terminal in the early stages of development could provide a springboard to substantial growth. The ICTF would provide near-dock service initially and then on-dock service in about five years, said James K. Lyons, CEO of the Alabama State Ports Authority.
The port is hoping to get some small-scale rail service this year.
“We’re looking at targeting the Midwest and to the north and east of here,” he said.
The 4,500-mile Tennessee-Tombigbee Waterway provides access from Mobile to a major swath of the nation’s midsection.
The port scored a major coup last fall when it landed a new roll-on, roll-off service linking it with Veracruz, Mexico. The service, called the NAFTA Gulf Bridge, effectively cuts an estimated 2,500 miles of truck traffic, according to the Alabama State Docks Authority, which runs the Port of Mobile. That reduces transit time, fuel consumption and congestion at the border crossings.
Tampa gained a link to Mexico several months ago when Zim Integrated Shipping Services introduced a weekly Mexico-Tampa express service linking the Florida port with Veracruz and Altamira. Zim also expanded its South America Express Service with a direct connection to Tampa from Brazil and Argentina.
The Port of Freeport, Texas, has two advantages that could help it attract some container services. It has a natural deep-water draft of 45 feet, and room to expand. The port has about 8,000 acres of land, only 300 to 400 of which is being used, Port Director Pete Reixach said. “Anyone wants to build a distribution center, come on down,” he said.
Contact William Armbruster at email@example.com.