Port Watch-Six Months Down. Six to Go.

Tom Marian Buffalo Marine Service, Inc.

Six months down, six to go. It is difficult to fathom that fewer weeks remain until 2019 than the number of days since it was 2017. Given that we are already on the backside of 2018, it is time to see how things are shaping up for the year.

The commencement of the summer trade taper in June resulted in the typical fall in monthly arrivals. Every port – save Sabine – registered a monthly vessel arrival decrease. Yet, on a more positive note, all but two ports remain ahead of 2017’s vessel arrival count.

The pair of year-to-date laggards that have fallen short when compared against last year’s first-half arrival count are the ports of Corpus Christi and Freeport. Mind you, in the port of Freeport, a mere 1.5% drop after a nine-and-one-half percentage decline over the last month is rather positive and certainly deserves a passing grade in the maritime commerce arena; particularly when one takes into consideration last year’s record movements on the waterfront. Corpus Christi – on the other hand – was one of last year’s darlings at the mid-year point. Not so this year, after chalking up one of the largest monthly percentage drops with nearly 14% fewer arrivals. All told, the port is suffering a bit of a soft patch with 12% fewer arrivals at this year’s mid-point. Perhaps this is a harbinger of things to come as the US-China trade tiff broadens. Brownsville is currently leaps and bounds beyond where it was a year ago on two fronts. First, 2017’s mid-year performance when weighed against 2016 was off by over 17%. Second, 2018’s mid-term performance is 12% ahead of last year’s pace – even after factoring in a 21% plunge in monthly arrivals. Galveston is similarly situated in that it continues to outpace its prior year arrival numbers by over 14%. What is perhaps most noteworthy is the fact that Galveston has had four consecutive months of arrival declines with the most recent one at 3%. Fortunately, the solid price of oil should contribute to a continued improvement over last year’s vessel count.

Several miles to the north, Texas City is also enjoying a 4.5% vessel arrival advantage year-to-date wise. Last year, at this time, things were lagging by 4% but arrivals remain in positive territory in 2018 after back-to-back monthly wanes – the most recent on being over 3%. Sabine has had a marked improvement over the past year in terms of vessel arrivals. As previously mentioned, this was the sole port that posted positive arrival numbers over the past month. That added nicely to its year-to-date performance which currently stands at nearly 17% higher than last year.

Finally, the Bayou City’s economic gem – the port of Houston – saw a significant taper in vessel arrivals over the last month; however, its cumulative arrival numbers for the year currently exceed 2017’s by over 2%. Given an 8% fall in vessel arrivals over the last month, it should not come as any surprise that the majority of the vessel categories ended up in the red for the month. Yet, there were a few bright spots; particularly with container ships. Specifically, June’s count was 12% higher than May’s with 93 vessel calls – an arrival count that has not been seen for this type of vessel in over 3 years. While the category is off by just shy 2% for the year, once again, the port is poised to set another container record by the end of the year. The count currently eclipses last year’s running total by 6%. General cargo also had a solid showing with a 10% monthly rise. Mind you, it was not enough to pull the category out of the red for the year as reflected in a 3% fall. Bulkers registered their worst showing for the year with a precipitous fall of 28%. This particular category is more vulnerable to the chilling winds of a tariff tangle and will most likely not show any improvement over 2017. There were 2 less car carriers on the docks in June but that was still the 2nd highest monthly count for the year. Hence, this vessel type exceeds last year’s tally by over 12%.

The energy triad continues to outperform 2017’s numbers as demand from Houston’s petrochemical complex shows no signs of dampening. Chemical tankers may have down over 11% during the last month but it continues to outdistance 2017’s vessel count by nearly 9%. LPG managed a modest 2.4% monthly climb in the arrivals arena. This pales in comparison to its 14% lead vis-à-vis last year’s count. Tankers are also experiencing a solid year-to-date gain with increased levels of exports including ever more barrels of crude. Even when one factors in the most recent 10% monthly decline, tankers remain firmly in positive territory with a 6% year-over-year rise. Closer to shore, inland tow movements across the Houston Ship Channel have experienced their fourth consecutive percentage loss. Nonetheless, brownwater activity is clearly on the uptick as substantiated by a 4% year-to-date gain.

All told, a mid-term report replete with a smattering of Cs, a few Ds, a handful of A’s and mostly Bs is a commendable progress report in the wake of uncertainty on the international trade front. Undoubtedly, there may be some more unsettling developments with respect to tariff-induced price hikes, a dearth of demand for agriculture exports or an overall sluggishness in world trade. Nevertheless, just as the summer trade lull is followed by fall’s restocking of inventory, goods will be consumed, prices will rise and the ebb and flow of commerce on the waterfront will continue.

  • Date August 14, 2018
  • Tags 2018 July/August