Port Watch-What’s Not To Like

By Tom Marian

Photo courtesy of Buffalo Marine

As Harvey recedes further in the rear view mirror, the residual effects of the historic storm are becoming less pronounced. In general, those ports that experienced sizable rebounds in September could not match those numbers in October, while the ports that were still reeling from restricted drafts through the month of September posted handsome gains in October. All in all, Texas ports tallied a modest 3.6% gain as they ushered in the first month of the year’s final quarter. Yet, they still trail 2016’s arrival numbers by just over 1%.

Freeport kicked off the final quarter of the year with a robust 17% increase in vessel arrivals; thereby placing yet more distance between this year’s throughput and last year’s. The October vessel count was the high for the year as the port continues to expand its customer base and capacity. At the rate the port is growing, it is not inconceivable that Freeport will enter the coveted triple-digit club by logging 100 or more vessel arrivals in a month before the end of 2019.

Corpus Christi also continues to outpace 2016’s arrival figures as it chalked up a 13% monthly gain. The port’s focus on the export of crude and various petroleum derivatives has served it well. The final port whose 2017 arrival total eclipsed that of 2016 is Sabine. Granted, the positive percentage is a scant 0.2%; however, Sabine’s October numbers were 31% above those of September as it hit a high for the year. Sabine is also capitalizing on the export of energy cargoes but, unlike Corpus Christi, it was adversely impacted by longer term shoaling problems due to Harvey.

The port of Galveston would have been hard pressed to improve upon its September arrivals since that particular month exceeded all others for the year. Accordingly, the ship tally plunged 20% for the month and remains off by over 3% for the year. Even as oil creeps towards $60/barrel, there are no signs that the Gulf oil patch is awakening from its long slumber. Just look at Corpus Christi: it’s easier to pump fracked barrels from the Texas shale formation than from several thousand feet beneath the Gulf of Mexico. Brownsville is certainly aware of the ramifications of $50-a-barrel oil. Its 2017 trade picture is subdued compared to years past as reflected in a 17% year-to-date decline following its most recent monthly free fall of 35%. Texas City also finds itself in a net loss position as fewer barrels are imported into this compact port and more pipelines deliver domestic barrels to its petrochemical complex. On a positive note, Texas City was up over 3% for the month but is off just shy of 9% compared to the same period last year.

A handful of miles to the north of Texas City, the behemoth port of Houston soldiered on as it logged its second highest monthly arrival count for the year. Since the high for the year was claimed by September, the monthly numbers were down by 1% and are also lagging 2016’s numbers by 1.6%. Most vessel categories were down for the month but there were some notable exceptions. First and foremost, 8% more tanker arrivals called upon H-Town; albeit 10% fewer tankers have visited Houston’s terminals over the past year. Car carriers also enjoyed a positive month but, they too, remain outpaced by the previous year. Ocean-going tows remain in positive territory for the year – to the tune of 12% – after a strong 15% monthly gain. Bulkers are also outperforming last year’s arrival count by 7% despite the most recent monthly wane of nearly 9%. While chemical tankers also found themselves in negative territory for the month, the overall picture is bullish for the year with 11% more arrivals than this time last year. Indeed, the overseas demand for the raft of refined products being produced by ever-larger petrochemical facilities continues to add to Houston’s export tonnages. Unfortunately, at this juncture, the same cannot be said about the general cargo stream of commerce which remains in the doldrums. Nonetheless, there are signs that its pace is quickening as projects move from the drawing board to the wide open spaces of the Lone Star State. Meanwhile, the containers keep flowing to and from the hemisphere’s largest petrochemical port. The Houston Pilots may be moving a few less container ships into the port, but they are certainly shoehorning ever larger vessels into those terminals. It should come as no surprise that Houston will once again exceed its record for number of containers handled by the end of this year. With two months remaining in this year of natural disaster challenges and stock market euphoria, Houston is well positioned to finish ahead of last year’s tonnage numbers with a vessel count at or slightly below that of 2016’s. Freeport’s aggressive marketing and expanded capability will yield the highest arrival percentage gains of all Texas ports. Of course, we cannot forget about what $60-a-barrel oil will do for those maritime gateways that provide access to all of that black gold; exports will climb, more development will ensue, and regional consumption will become a bit more frenzied. It’s all looking rather good for now. After all, the Lone Star State just claimed its first World Series Championship. What’s not to like?

Tom Marian
Buffalo Marine Service, Inc.


  • Date December 19, 2017
  • Tags Dec 2017-Jan 2018