Goal to double U.S. exports by 2014, but could be tripped by lackluster 2012.
By Eric Johnson
More than halfway through the Obama administration’s efforts to double U.S. exports by the end of 2014, export volumes through the biggest U.S. container ports are stagnating.
A survey of loaded outbound port volumes through September at the nation’s key containerized cargo gateways shows a distinct lack of growth. What’s more, data from the consultancy Seabury shows U.S. export volume had fallen by 3.6 percent through July.
It’s not the story that the government wants to hear, given its vociferous push to support U.S. businesses and their efforts to expand export markets through President Obama’s National Export Initiative (NEI). But the reality is 2012 has been a sorry year on the export front.
More than half of the nation’s top container ports have seen export growth this year, but that fact is a bit misleading. Other than a bump in the South Atlantic region between Norfolk, Va., and Savannah, Ga., the nation’s other regions are even or down for the year.
For instance, the Port of Los Angeles has seen a 1.9 percent rise year-on-year in loaded export volume through September to 1.6 million TEUs. That increase has been virtually offset by a 1.3 percent decline at the neighboring Port of Long Beach, where volume has fallen to 1.1 million TEUs. Together, the nation’s biggest port complex is still positive for the year, but barely, and certainly well short of the growth needed to keep NEI momentum driving forward.
|Sources: American Shipper, port statistics.
Further north in California, the problem seems more acute. The Port of Oakland has seen loaded export volume drop 1.1 percent. That decrease is crucial for two reasons. For one, Oakland is much more dependent on export cargo than the Southern California ports — 55 percent of its full volume is exports this year, compared to 33.3 percent of Los Angeles’ and 33.9 percent of Long Beach’s. Second, Oakland has no natural regional competitor, so a fall-off in volume can’t be explained by the loss of volume to a nearby port, such as in Southern California or the Pacific Northwest.
In the Puget Sound area, Tacoma has seen volume climb 14 percent, but the larger Port of Seattle experienced an export volume drop of 10 percent, again essentially offsetting each other. It’s also part of a port-wide migration of volume south from Seattle to Tacoma, with Tacoma’s total volume up 11.3 percent this year, while Seattle’s has dropped 4.4 percent.
The slight fall-off in Oakland is somewhat comparable to the Port of New York and New Jersey, where loaded exports have dropped 1.3 percent through September. Like Oakland, New York/New Jersey has less of a natural competitor than the Southern California or Pacific Northwest ports, thus a volume drop is a volume drop.
New York/New Jersey has likely been hit by Europe’s economic woes, while the Pacific ports have been hurt by slowing growth in China. Exports of scrap and machinery have fallen this year to Asia’s powerhouse, underlined by Caterpillar announcing in mid-October that sales to China were down this year.
China’s gross domestic product grew at 7.4 percent in the third quarter of 2012, the slowest rate of growth in three years.
Seabury’s statistics through July show that containerized U.S. exports to the Asia-Pacific region fell 4.6 percent to 3.4 million TEUs. The figures include U.S.-origin cargo routed through Canadian or Mexican ports.
There were sizable drops to Europe and the Middle East/Indian Subcontinent region as well, with stagnation in the Latin American export markets. The only export region to grow sizably was the relatively small Africa market.
In terms of export commodities, the fall-off this year has been steep in raw materials, industrial consumables, and foods, by far the largest single category tracked by Seabury, which has overall export volume down 3.6 percent to 5.5 million TEUs through July.
There is an apparent bright spot though. The Norfolk-Charleston-Savannah troika has all seen export volumes rise solidly this year.
The Port of Savannah’s volume has risen 1.7 percent to 964,018 TEUs, while the Port of Virginia’s has climbed 8.3 percent to 829,687 TEUs (including empties). The Port of Charleston’s export volume has risen 3.6 percent to 442,922 TEUs.
All three ports, like Oakland, rely heavily on exports, making their growth this year all the more important. More than half of Norfolk’s and Savannah’s loaded volume is tied to exports, while barely less than 50 percent of Charleston’s is.
But to place their combined growth in a statistical context, the three Atlantic ports’ collective volume gain this year was under 100,000 TEUs, or less than 9 percent of the Port of Long Beach’s total export volume so far this year.