Houston Waterborne Foreign Trade – Ports that Deliver

Dave Cooley, GHPB

As waterborne commerce has been around since time immemorial, it leads one to the conclusion that ports that deliver the goods have also been around for a long time as well. Generally, this is true, but a well-coordinated growth and development plan coupled with several innovative implementation ideas can allow an interloper to become a team member.
This is the fourth installment of the Port Bureau’s analysis of the waterborne foreign trade of the U.S. and addresses the flow of trade by port; specifically the top eight ports at the end of 2014. Data will show the trend in both value (U.S. dollars) and tonnage for the U.S. waterborne foreign total trade (imports plus exports), along with individual assessments for imports and exports, the type of movement (containers or bulk/break bulk) from 2003 to 2014, and display the top eight ports in each category. Figure 1 shows the top eight ports for both value and tonnage for 2014.

us-vector-map

Figure 1: Top ports by value and tonnage, Source: GHPB analysis of US Customs Bureau Data

Port Rank – Total Trade
Value
The value of the U.S. waterborne foreign total trade grew from $810 billion in 2003 to over $1,750 billion in 2014; more than doubling in 11 years. Figure 2 shows the ranking of the top eight ports and how the total trade values have evolved over the 11-year analysis period.

total us trade by port value

Figure 2

Features of the top eight value ports:

  • The top eight ports handle $994 billion or 57% of all waterborne foreign total trade of the U.S. (imports plus exports).
  • The top three ports handle $609 billion or 35% of all waterborne foreign total trade of the U.S. (Houston is #2, handling $167 billion of U.S. waterborne foreign total trade).
  • The top port accounts for $290 billion or 17%.
  • Six ports of the top eight value ports are also in the top eight tonnage ports.
  • Four ports of the top eight value ports are located on the East Coast; two ports are located on the West Coast; and two ports are located on the Gulf Coast.

 

 

Tonnage
The total U.S. waterborne foreign total trade tonnage discharged from and loaded aboard ocean-going ships grew slightly over 11 years from 1,210 million metric tons in 2003 to over 1,286 million metric tons in 2014; a net increase of just 76 million tons. Figure 3 shows the ranking of the top eight ports and how the total trade tonnage has evolved over the 11-year analysis period.

total us trade by port tonnage

Figure 3

Regarding tonnage, features of the top eight ports are:

  • The top eight ports handle 595 million metric tons or 46% of all waterborne foreign total trade tonnage of the U.S.
  • The top three ports handle 322 million metric tons or 25% of all waterborne foreign total trade tonnage of the U.S.
  • The top port (Houston), accounts for 148 billion metric tons or 12% of total trade tonnage
  • Six ports of the top eight tonnage ports are also in the top eight value ports
  • Two ports of the top eight tonnage ports are located on the East Coast; two ports are located on the West Coast; and four ports are located on the Gulf Coast – two of which are in Texas.

 

 

 

 

Having established the bounds of the U.S. waterborne foreign trade, evaluating the individual trade components, imports and exports, as well as the manner of trade, viz., moving in containers or bulk/break bulk offers an interesting assessment of the top eight ports.
Cargo value and tonnage will be evaluated separately, and the top eight ports of each of four categories (import or export and container or bulk/break bulk) will be shown.

value top 8

Figure 4

Port Rank – Value
Figure 4 describes the top eight value ports by movement and cargo type.

Total Imports
U.S. waterborne foreign trade imports during 2014 were $1,150 billion, $170 billion above the annual average from 2003 to 2014. Imports for the top eight ports total $712 billion or 62%.

Salient features for 2014:

  • The top waterborne foreign trade import commodity group imported at LA is boilers, machinery, motors, and electronics; at Newark and Houston, it’s energy;
  • The three top ports account for $454 billion or 40% of waterborne foreign trade imports;
  • Four ports are located on the East Coast, three ports on the West Coast, and one port on the Gulf Coast (Houston).

Container Imports
Imports of finished and semi-finished goods that are shipped in containers totaled $723 billion during 2014 or 63% of total U.S. waterborne foreign trade imports and $170 billion above the 11-year average. Container imports for the top eight ports totaled $584 billion or 81%.
Interesting features for 2014:

  • The top waterborne foreign container trade imported commodity group for all three top ports is boilers, machinery, motors, and electronics;
  • Top three ports total $391 billion or 54% of all imported waterborne foreign container traffic;
  • Four ports are located on the East Coast; three on the West Coast; and one port on the Gulf.

Bulk and Break Bulk Imports
Waterborne foreign trade imports of bulk and break bulk commodities totaled $427 billion during 2014 or 37% of the total waterborne foreign trade imports and were $2 billion below the 11-year average. Bulk and break bulk imports for the top eight ports totaled $197 billion or 46%.

Intriguing aspects for 2014:

  • Energy is the top imported bulk/break bulk waterborne foreign trade commodity group for all three top ports;
  • Top three ports total $107 billion or 25% of all waterborne foreign bulk/break bulk imports;
  • Three ports are located on the East Coast; one port is on the West Coast; and four ports on the Gulf Coast – two of which are in Texas.

Total Exports
U.S. waterborne foreign exports were $600 billion during 2014 and were $180 billion above the annual average from 2003 to 2014. Waterborne foreign exports for the top eight ports totaled $327 billion or 54%.

Interesting facts for 2014:

  • The top waterborne foreign export commodity group at Houston is energy; at LA it is chemicals, fertilizers, plastics, and rubber; and at NY it is boilers, machinery, motors, and electronics;
  • Top three ports for waterborne foreign trade exports total $172 billion or 29%;
  • Four ports are located on the East Coast; two on the West Coast; and two on the Gulf Coast, including Houston.

Container Exports
Exports of finished and semi-finished goods that are shipped in containers totaled $261 billion during 2014 or 43% of total U.S. waterborne foreign exports and $67 billion above the 11-year average of total container exports. Container exports for the top eight ports totaled $194 billion or 74%.

Intriguing facts for 2014:

  • The top waterborne foreign export container trade at all three ports is chemicals, fertilizers, plastics, and rubber;
  • Top three ports total $93 billion or 36% of the total waterborne foreign export container trade;
  • Four ports are located on the East Coast; three ports on the West Coast; and one port on the Gulf (Houston).

Bulk and Break Bulk Exports
The export value of waterborne foreign bulk/break bulk trade was $339 billion in 2014, or 57% of the total waterborne foreign exports. This was $114 billion or 50% above the 11-year average. The top eight ports exported $163 billion or 48%.

Intriguing facts for 2014:

  • Energy, predominantly refined products exports, are the top waterborne foreign export bulk/break bulk commodity at the top three ports;
  • Top three ports total $106 billion or 31% of the waterborne foreign bulk/break bulk exports;
  • Three ports are located on the East Coast; none on the West Coast; and five on the Gulf – one of which is Houston.

Port Rank – Tonnage
Figure 5 describes the top eight value ports by movement and cargo type.

tonnage top 8
Total Imports
U.S. waterborne foreign trade import tonnage was 673 million metric tons during 2014, which was 163 million metric tons below the annual average from 2003 to 2014. Tonnage imports for the top eight ports totaled 302 million metric tons or 45%.
Salient points for 2014:

  • Energy, reflecting declining crude oil imports since 2006 as U.S. oil production increases, remains the top imported waterborne foreign trade tonnage commodity group for all top three ports;
  • Top three ports total 170 million metric tons or 25% of the imported waterborne foreign trade tonnage;
  • One port is located on the East Coast; one port on the West Coast; and six ports on the Gulf Coast – three of which are in Texas.

Container Imports
U.S. waterborne foreign import container trade tonnage was 154 million metric tons during 2014, or 23% of total U.S. waterborne foreign trade import tonnage and was 19 million metric tons above the annual average container import tonnage from 2003 to 2014. Container tonnage imports for the top eight ports totaled 109 million metric tons or 71% of the total container imports.

Features of waterborne foreign imported container tonnage for 2014:

  • The top imported commodity group at LA is boilers, machinery, motors, and electronics; at Newark it is foodstuffs; and at Savannah is chemicals, fertilizers, plastics, and rubber;
  • The top three ports handled 70 million metric tons or 45% of the total imported waterborne foreign trade container tonnage;
  • Four ports are located on the East Coast; three on the West Coast; and one port on the Gulf.

Bulk and Break Bulk Imports
U.S. waterborne foreign import bulk and break bulk trade tonnage was 519 million metric tons during 2014, or 77% of the waterborne foreign trade import tonnage and was 201 million metric tons below the annual average container import tonnage from 2003 to 2014. Tonnage imports for the top eight ports totaled 230 million metric tons or 44%.

Salient factors for 2014:

  • Energy is the top waterborne foreign import bulk/break bulk trade tonnage at the top three ports;
  • The top three ports account for 122 million metric tons or 24% of the waterborne foreign import bulk and break bulk trade tonnage;
  • One port is located on the East Coast; no ports on the West Coast, and seven ports on the Gulf Coast – three of which are in Texas.

Total Exports
U.S. waterborne foreign export trade tonnage was 613 million metric tons during 2014, which was 143 million metric tons above the annual average from 2003 to 2014. Tonnage exports for the top eight ports totaled 325 million metric tons or 53%.

Salient features for 2014:

  • Energy is the top waterborne foreign export trade tonnage at both Houston (oil) and Norfolk-Newport News (coal); at New Orleans it’s grains and milling products;
  • Waterborne foreign export trade tonnage at the top three ports totals 198 million metric tons or 32%;
  • One port is located on the East Coast; two ports on the West Coast; and five ports on the Gulf Coast – three of which are in Texas, led by Houston.

Container Exports
U.S. waterborne foreign export tonnage of container goods during 2014 was 107 million metric tons or 17% of total U.S. waterborne foreign export tonnage and was 20 million metric tons above the 11-year annual average. The top eight ports exported 77 million metric tons or 72%.

Interesting aspects for 2014:

  • The top waterborne foreign export container trade tonnage at both Houston and LA is chemicals, fertilizers, plastics, and rubber; and at Long Beach it is foodstuffs;
  • Top three ports totals 40 million metric tons or 38% of the waterborne foreign export container tonnage;
  • Three ports are located on the East Coast; four on the West Coast; and one on the Gulf Coast (Houston).

Bulk and Break Bulk Exports
Export tonnage for the waterborne foreign bulk/break bulk trade for 2014 was 505 million metric tons or 83% of the total waterborne foreign export tonnage and was 122 million metric tons or 24% above the 11-year average. The top eight ports exported 281 million metric tons or 56%.

Intriguing facts for 2014:

  • Energy (refined petroleum products at New Orleans and Houston; coal at Norfolk-Newport News) are the top waterborne foreign bulk/break bulk export commodity at the top three ports;
  • Top three ports total $106 billion or 31% of the waterborne foreign bulk/break bulk exports;
  • Three ports are located on the East Coast; none on the West Coast; and five on the Gulf – one of which is Houston.

Summary
By taking the top three ports from the above categories, 24 possible port and mode of transport combinations are created, which are filled by 10 unique ports. Out of these 24 possible combinations, the Port of Houston captures six; Los Angeles has five; Long Beach, Newark, New York, and New Orleans each have three; and Gramercy, Norfolk-Newport News, Port Arthur, and Savannah are each mentioned once. Furthermore, the ports mentioned in the top-three group can be generally categorized as a container port, an oil port, or a diverse port.
Container ports: Container ports are generally characterized as a conveyor belt. That is, goods arrive by ship boxed in a container, are unloaded onto a chassis or train, and moved locally or inland to enter the distribution system. Loading a containership also utilizes the conveyor belt analogy in reverse. The cargo handled by a container port is generally high value-added finished or semi-finished products requiring little or no further manufacture. That is, the goods shipped in a container are generally consumer-ready and little value added is required. Container ports include Long Beach, Los Angeles, Newark, New York, Norfolk-Newport News, and Savannah.
Oil ports: An oil port functions somewhat similar to a container port in that there is unity of cargo serving a particular logistics system. Specifically, an oil port is where the customer base is largely, if not completely, composed of oil refiners and oil terminals and where oil is the predominant flow of waterborne foreign trade moving through the port complex. Here is where the container comparison ends. Oil is a raw material and as such requires a value-added activity to be transformed into a finished product. Any port handling any product that requires any further processing or transformation offers value-added opportunities and enhances growth of the economy. During 2014, high oil volumes coupled with high oil prices created prominence for several key ports being classed as an oil port, such as Port Arthur, TX and Gramercy, LA., both of which are included in the top-three analysis.
Diverse ports: Diverse ports exhibit attributes of both a container port and an oil port. That is, the port complex offers the logistics infrastructure to accommodate multiple modes of transport (containerships and bulk/break bulk ships), supports local waterfront processing or manufacture, and connects to local industry facilitating off-site value-added enhancements. Houston and perhaps New Orleans can be considered diverse ports. Houston is active in both container and bulk/break bulk activities. New Orleans, while container activity may be considered minimal, is quite active in various liquid and solid bulk commodities as well as handling various bulk/break bulk cargos.
As noted, Houston appears in six of the possible 24 top three categories. Specifically, Houston appears in bulk imports for value and for tonnage, in container exports for value and tonnage, and in bulk and break bulk exports for value and for tonnage. Houston is the only port that appears in all four export categories – a testament to the diversity of not only the port but also the community.
Conclusion
The waterborne foreign trade of the U.S. is quite stable, yet dynamic. Ports that are less flexible and less pro-active may find that when the list is published for next year, that port may not be found. Key attention to innovation and coordinated port development is essential. The fifth article, titled “Now you see me; now you don’t,” discusses the evolution of the top ranked ports and the events that occurred to change the port’s position in the ranking.

  • Date January 15, 2016
  • Tags January 2016