News & Updates: Port Bureau News: June 2020

Port Watch: Je Me Souviens

Friday, June 26, 2020  
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By Tom Marian, Buffalo Marine Service, Inc.

It can never compare to the sylvan shores of Chesapeake Bay; or, to the bucolic setting of the San Juan Islands at the southern reach of the Strait of Georgia; or, to the many leagues of wilderness bordering the St. Lawrence Seaway; but , the world’s tallest war monument that sits astride Buffalo Bayou is an omnipresent reminder of the most unlikely of events. Indeed, but for the strident prodding of a local farmer, Sam Houston’s band of warriors may very well have marched north to Nacogdoches rather than opting for the southeast fork destined for Harrisburg. If it had not been for the impetuousness of Sidney Sherman, Santa Anna’s army would have never been surprised by the late afternoon assault by the Texian Army. Regardless of the circumstances leading up to the victory on the marshy plains of the San Jacinto, a republic was born and the massacres of the Alamo and Goliad were avenged.

It’s anyone’s guess as to how many mariners ponder the history behind the monument that looms well above the horizon; however, it is a safe bet that there were fewer eyes gazing on this site in May than any other month in 2020. May’s 5.6% decline added to its year-over-year decrease to the tune of 2%. Across the spectrum of vessel types, a few categories held their ground in spite of the trading malaise. Bulkers chalked up the most impressive monthly gain at just shy 27%. Unfortunately, bulkers still trail 2019’s pace by nearly 21%. Container vessels managed to hold their own with a 4.7% rise for the month. Thus, boosting its year-to-date performance by over 9%. Nonetheless, that does not tell a complete story of what is unfolding on the waterfront given that more ships are bringing fewer containers in and out of the port. Specifically, the total TEU monthly count was relatively flat over the last month; albeit, full TEU exports were up 10% for the month and full TEU imports were down 1% for the same period. Most striking was the fact that empty import containers plummeted 51% from April to May. Overall, 2020’s total TEU count is running 1% ahead of last year’s pace. Undoubtedly, things are slowing in the TEU realm.

Car carriers are getting hammered in this era of pandemic as the arrival count plunged 24% in the last month and remains 10% behind last year’s arrival count. General cargo is also faltering but not to the same extreme as car carriers. Last month there were 6% fewer arrivals for this vessel type.  Houston’s energy triad has certainly seen better days. Tankers had one of their lowest monthly vessel counts in recent memory with nearly 24% less arrivals. This paltry showing dragged tankers further into the red on a year-to-date basis (i.e., 9.8%). Chemical tankers remain slightly ahead of 2019’s count after the most recent 1.3% monthly wane. LPG arrivals currently retain the best overall year-to-date performance of the three, with a 15% gain after its most recent uptick of 4.7%. Only oceangoing tows eclipsed LPG’s year-over-year percentages with an enviable jump of 20.4%. This is in stark contrast to local inland tow movements which failed to achieve the 10,000 mark in May and ended nearly 10% behind April. The good news is that, thus far, 2020 has seen 3.5% more inland tow movements across the Houston Ship Channel than that of 2019.

While the port that serves the Bayou City certainly did not have much to brag about in May, there were several other Texas ports that posted double digit percentage declines. At the top of the list was Galveston Bay’s cruise ship capitol. The COVID-19 crisis has been rather unforgiving to the cruise ship industry and Galveston has borne the brunt of that hardship with a near-record low arrival number that was less than one-half its arrival account of two months ago. The most recent dive of over 29% has pulled the port’s year-to-date arrival stats further into the red which currently stands at 11.6%. At this juncture, Galveston will be hard pressed to surpass its 2019’s numbers.

Several miles to the north, the port of Texas City– commerce was not much better. 19% fewer vessels plied its entrance channel and this third consecutive decrease in vessel arrivals currently places 2020 numbers nearly 7% behind those of 2019’s. The drastic decrease in bulk liquid exports has taken the wind out of the sails of this port after an extremely promising start to the year.

With each passing month in 2020, fewer and fewer deedpdrafts have navigated through the Port of Sabine. In fact, May was the fourth consecutive decline in vessel arrivals for the port. The most recent arrival nadir was 11% below the previous month and has now fallen 12% behind last year. It, too, is a victim of the dampened demand for petrochemical exports.

The Port of Brownsville continues to hold its own in a year of economic uncertainty. The port has posted four monthly gains in a row. May is the new high tide for the port with the most recent 3% hike; 33% more vessels called on the port in 2020.

There is an interesting story behind the port that Dow Chemical built prior to World War II. When the company sought to expand its manufacturing base south, several executives were partial to expanding its operations in Corpus Christi over the lesser known Port of Freeport. Yet, a monstrous January ice storm descended upon Corpus Christi, prompting the search team to abandon Corpus Christi and drive to Freeport. Upon reaching Freeport, the day’s sunny clime motivated Dow to purchase 800 acres and, as they say, the rest is history.

Those that participated in the opening of Dow’s magnesium plant in 1941 would certainly not recognize today’s bustling port which welcomed 25% more ships in the last month. May’s triple digit arrival count has further solidified 2020’s dominance over 2019’s arrival figures. Mind you, Corpus Christi is no shrinking violet when it comes to maritime commerce. 2020’s aggregate vessel count remains over 17% higher than that of 2019’s. Yet, as evidenced by the most recent monthly slide of 0.5%, exports and refinery activity have been softening due to lagging demand for such things both at home and around the world.

Such is the maritime trade picture as the “twin year” approaches it midpoint. Fewer ships in summer, greater numbers in fall, it always seems to be in a state of flux dependent upon the whims of the consumer. That is certainly in stark contrast to those things that have been etched in stone or secured in the earth to memorialize an event of many moons ago. Ultimately, that 570-foot concrete obelisk that casts a shadow over the nation’s largest petrochemical port is a tie to the past. It is a marker to a time that once was and seeks to bind a people to an ideal, a vision, or simply remind others of a great sacrifice. Consequently, for better or worse, it has had an impact on the present and will continue to do so into the future despite the varying perspectives of what once was, what is and what will be.

Yes, indeed, the Houston Ship Channel is no St. Lawrence River but if you were to set sail on that international waterway you could not help but notice the magnificent Plains of Abraham in Quebec City. It is the site where two very famous generals – Montcalm and Wolfe - died fighting for their respective nations in order to secure an empire in North America. England prevailed and France relinquished Lower Canada to the victor, resulting in the exile or Le Grand Derangement of thousands of Acadians to the British colonies that would eventually comprise the United States. In short, the French-speaking inhabitants had to adjust to an English government that would challenge their way of life and sense of identity. Quebec accepted its new overlords but never forgot its roots. To this day, if you were to spy one of their license plates, you would see their provincial motto stamped at the bottom - “Je Me Souviens”.

Simply translated, it means, “I remember”. However, in remembrance, what is far more important for the residents of that province to remember, is the past and its misfortunes and the past and its lessons.

About the Author

Tom Marian is the General Counsel of Buffalo Marine Service, Inc. He also serves on the Executive Committee of the Port Bureau Board of Directors.