Port Watch – Filling the Basket ‘One Peck’ at a Time

Tom Marian, Buffalo Marine Service, Inc.

There’s an old saying that the best way to fill a basket is one peck at a time. The logic being that ultimately enough effort will yield a full bushel basket even if the individual contributions are quite small at the onset. Now that we have four months under our belt, how does 2016’s basket compare to last year’s? For half of the major ports, the arrival numbers are promising enough; however, for the bulk of the other half, there is much catching-up to do. This is particularly true in light of the fact that the month of April was flat. All told, the state’s cumulative vessel arrival count continues to lag the previous year by nearly 4%. On the other hand, the inland tow sector movements across the “Houston Marine Thoroughfare” enjoyed a respectable 2% monthly gain which succeeded in pulling this sector of the maritime transportation community into the black – albeit by a paltry 4/10th of one percent.

2016 APR GHPB Vessel Movement Database - Texas

A few of the Lone Star ports tallied sizeable monthly gains which, in turn, bolstered the year-to-date positive numbers. The port of Freeport yielded the highest monthly percentage gain at 15%. Its April arrival count was the high for the year. Consequently, Freeport is tracking 9% above its 2015 numbers. The Port of Brownsville also had an “arrival high” for the year as 7% more vessels called upon this border port. To date, Brownsville is outpacing last year’s performance by 3%. After a very solid performance in March, the port of Sabine managed to eke out a .5% gain but that was not enough to eclipse January’s arrival count which remains as the high count for 2016. The good news is that Sabine’s energy exports have created enough activity to keep the port 4% ahead of last year’s arrival numbers.Buffalo 2016

Unfortunately, to the west, the Port of Texas City could not hold on to its triple-digit vessel count as it saw nearly 11% fewer arrivals. Things have not been helped by the departure of its major shipyard and far less activity at the majority of the oil storage terminals. April’s poor count numbers dragged the port further into the red on a year-to-date basis to the tune of over 5%. Several miles to the south, the Port of Galveston fared better over the last month by avoiding a double-digit percentage decline – by less than 1%. Unfortunately, the port that serves as the gateway to Galveston Bay, is far, far behind the 2015 vessel arrival tally. How far? Nearly 27% down! Port Corpus Christi was the third and final port to register a monthly decline of over 7% with its lowest vessel count for 2016. Not surprisingly, this further dragged down its year-to-date numbers by 10%.

While the two ports to its south languished during this last month, Houston managed to attract nearly 700 vessels – a high for the year. Nonetheless, despite this 2% monthly rise, Houston still trails 2015’s arrival count by nearly 3%. Much of the flat-to-negative trend is tied to softening demand for major projects in the petro-chemical arena. Other factors that have taken the wind out of the region’s economic sails have been substantial cuts in high-paying jobs that relied upon unbounded growth in the shale-gas plays and an offshore petroleum exploration market that has experienced dramatic reductions over the last two years.

Throw in lackluster demand for raw materials on the other side of the Pacific and there is little wonder that one of Texas’ biggest economic engines is stuck in low gear. Thus, general cargo moves remain 15% below 2015 Half Horz Odfjell2015’s year-to-date vessel arrival count and bulkers are off 21% for the same period. The good news is that while bulk vessel arrivals fell 10% over the last month, general cargo moves were up 14%. Container vessel traffic – like its distant cousin general cargo vessels – also saw a high vessel count for the year. Hence, with a 4% monthly gain in container vessel arrivals, the port is poised to move more than 2 million TEUs for a second-consecutive year.

Houston’s energy-laden vessels did fairly well over the course of the last month. Chemical tankers posted a monthly high for the year which resulted in a 5% increase. Nonetheless, 2016 is still 9% below that of the previous year. Conversely, LPG movements hit a nadir for the year as this vessel category registered a 10% drop. Nevertheless, it continues to outpace 2015’s numbers by 23% reflecting a solid demand for this form of energy beyond the borders of the United States. Finally, as the price of a barrel of crude emerges from its hole, tank vessels joined the “best of the year” club with a monthly tally resulting in a 2.5% climb and a 4.4% positive showing for the year.

Overall, there appears to be a desire to break free from economic headwinds that are lurking well beyond the horizon. Perhaps 2016’s less-than-robust performance to date reflects the caution that permeates various business sectors until a new president takes the oath of office. Then again, April may foreshadow the beginning of greater trade momentum that is doing its best to “gain some legs” in order to build upon last year’s gains. If that is the case, the basket-filling pecks will need to pick up speed, given that we are already a third of the way through the year and much work needs to be done.

2016 APR GHPB Vessel Movement Database - Houston

  • Date June 14, 2016
  • Tags June 2016