- THE MAGAZINE
Located centrally on the US Gulf Coast, the Port of Houston handles nearly 70 percent of all containerized cargo in the Gulf of Mexico. Unlike ports on the East and West Coast, which focus on specific trade regions, the Port of Houston utilizes the Gulf of Mexico as a direct gateway to the world, bringing far-reaching destinations in Asia, South America, Europe and beyond to the fingertips of its economically booming home state.
As business at the Port of Houston continues to increase, the expansion of the Panama Canal, a $5.25 billion project expected to be complete in 2015, will enhance traffic in and out of Houston and further establish its position as the leading US port.
According to the US Department of Commerce’s International Trade Association, the Houston-Sugar Land-Baytown area of Texas is considered the largest export market in the United States. From 2010 to 2011, a boom in shale oil production spurred a nearly 30 percent increase in exports from the Port of Houston, resulting in a $23.9 billion increase in volume.
With increased exports, more jobs and a burgeoning economy, Texas welcomes nearly 1200 new citizens to its community every day. The growing population couples with heightened demand for products, again fueling the call for trade in Houston.
As the global marketplace prepares for the Panama Canal expansion, Triton Overseas Transport, a Houston-based NVOCC and provider of international freight services, readies for the Port of Houston’s expected 15 percent increase in business. More specifically, the company focuses on receiving an increase in direct port calls in Asia and the west coast of South America from carriers, as well as developing new LCL services to handle increased volume from Texas, Louisiana, Arkansas and Oklahoma.
“Currently, 850,000 TEUs en route to Asia originate in Texas, Louisiana, Oklahoma and Arkansas annually. The Port of Houston handles only 6 percent of this volume, leaving plenty of opportunity for enhanced capacity,” comments John Moseley of the Port of Houston Authority.
From 2012 to 2013, the Port of Houston experienced a 43 percent trade growth from Asia largely due to lower freight costs by all-water services including MSC and COSCO. This trend is expected to strengthen following the Canal widening. Texas’ production of resin should also be monitored for hints into future business opportunities.
By 2016, Texas is expected to surpass Singapore and the Middle East in resin production. Advancements in fracking as well as investments in the use of natural feed stocks by major petroleum companies provide Texas with a competitive edge in the global marketplace.
As the world awaits the completion of the Panama Canal, Houston-based businesses, including Triton, prepare for a shift in trade from the congested West Coast ports to the Gulf Coast. It will mark the first time in history that the Gulf Coast is able to compete for West Coast business. Surely, businesses will do what they can to prepare for a looming change in the global marketplace.