Posted on 11/07/2004 6:58:42 AM PST by maui_hawaii
When Wal-Mart's enormous distribution center in Chambers County opens next year, it will trigger a substantial increase in shipments from Asia through the Port of Houston.
And it didn't happen by accident.
The costly statewide push to snare the 2 million-square-foot warehouse operation is a big win. The facility under construction will cover 50 acres and ultimately could double in size.
Wal-Mart, the world's biggest retailer, depends so much on shipments from the East that shipping lines are adding service.
From the day — 90 years ago this month — that the Houston Ship Channel officially opened, its backers have been constantly pushing for business from around the world.
While the city cheered as a boat loaded with cast iron pipe moved up the Houston Ship Channel in October 1914, just weeks before the official opening, port backers had just begun.
They convinced the master of that vessel, the Henry C. May, to contact the captain of a coal-carrying vessel to urge him to bring that cargo to the unproven port.
Capt. Benjamin Benson ultimately brought the 290-foot-long vessel Dorothy, which sailed from Philadelphia loaded with 3,000 tons of coal. Instead of going to Galveston, it plied the newly dug Ship Channel.
The entrance of that load of coal was front page news in the Houston Chronicle because the arrival of oceangoing freight was still a rarity in the city.
Leading player Today, the port is first in the United States in foreign tonnage and second in total tonnage, thanks in large part to the huge trade in petrochemicals, a natural outgrowth of the city's role as an energy capital.
But the port has also become a dominant player in the container business, handling roughly two-thirds of all containers that enter the Gulf of Mexico. This hasn't come as easily as the long-established oil business. The port is banking that it can grow, however, persuading voters to back bonds for the billion-dollar Bayport expansion.
Voters also were asked to back bonds for the first wharves built for the new Ship Channel in 1914.
Global logistics The port has pushed trade with Asia up by 28 percent over the past two years. Goods transported solely by ocean vessels amounted to about 9.4 million tons in 2002 and are expected to jump to about 12 million tons for 2004, according to statistics and projections from the Port of Houston Authority.
Trade officials at the Port of Houston say they expect business will continue to expand.
"Houston is getting back into the East Asia trade," said John Horan, the port's trade director. "There is so much growth in East Asia in manufacturing, particularly in China, and major retailers are sourcing a lot of their consumer goods out of East Asia."
Pete Smith, director of trade development for NYK Line, which recently added service through the Panama Canal to the port, said Houston won big when it snared Wal-Mart's new distribution center. U.S. consumers have an enormous appetite for shopping, and Wal-Mart is the biggest importer, he noted.
"Wal-Mart, to a certain degree, is on the cutting edge of global logistics," he said. "Different gateways in the U.S. are reaching saturation thresholds, and that will be revealed over the next three to five years at different ports."
Houston stands to gain because it will be a major distribution point for the huge retailer when its center is completed next year, he said.
The combination of Wal-Mart and the existing Home Depot distribution center near the port is driving carriers to come to Houston, said Rick Couch, who runs Osprey Line.
"Houston is becoming a pretty big option," Couch said.
Smith noted that because Americans also are moving away from expensive areas to live and shifting to places like Arizona, Houston is becoming a natural gateway.
Waiting on Wal-Mart The focus on grabbing more Asian trade is just the latest of many marketing pushes for the port. In recent years, its promotion efforts have aimed at seizing opportunities in Asia and Latin America.
This year, China has been one of the world's biggest engines for economic growth. But to tap into this burgeoning manufacturing center, Houston has had to hurdle a big obstacle: Historically, most goods from Asia move through West Coast ports.
The trip to the West Coast ports and then onto trains has been quicker and cheaper than traveling through the Panama Canal, which allows for only limited ship sizes. But congestion at West Coast ports coupled with labor problems and rail congestion have led shippers to seek alternatives.
"A lot of big retailers say they want an alternative to the West Coast, to come through the Panama Canal and come to Houston," Horan said. "The near- and long-term future for us both looks very good."
Several carriers already provide service between Houston and Asia via the Panama Canal, but other shipping lines reportedly are considering adding service once the Wal-Mart center is open.
Ties to Panama Canal This growing trade could forge an even closer relationship between the port and the Panama Canal, two entities that share common roots. Both are man-made, and both opened within months of each other: the canal in August 1914, the Ship Channel in November of the same year.
Numerous improvements have been made at the Panama Canal in recent years to handle more and bigger ships, and discussions are under way to expand the "big ditch" more.
Last year, the Port of Houston and Panama Canal Authority entered into a business agreement aimed at attracting more goods from Asia by promoting the route.
"The most recent is NYK Line with Panama-Houston relay service," Horan said. "And we have got several major ocean carriers looking at Houston for East Asia services."
The initiative for the service by NYK and Megacarriers, which began in August, came from Wal-Mart, according to NYK's Smith.
Each of the two vessels used for the service carries 500 20-foot-equivalent containers at a time and can easily traverse the canal.
But the fact remains that many vessels steaming to the United States from Asia are too big to pass through.
West Coast bottleneck Currently, cargo is backing up again on the West Coast, with as many as 40 vessels at a time anchored in the harbor at Los Angeles.
The problems on the West Coast stem from labor shortages as well as rail congestion.
Shippers here are also experiencing rail headaches, with demand growing faster than Union Pacific can handle. The port's Barbours Cut container terminal is operating at capacity.
For that reason, the construction of Bayport was a big topic of discussion when Houston port officials went on a trade mission to East Asia recently, calling on corporations and government officials in Tokyo; Taipei, Taiwan; and Shanghai, China.
Plans call for the initial phase to come on line in 2006, although Bayport opponents are pursuing legal challenges.
NYK Line said it likes what it sees in Houston.
"Overall, the Port Authority of Houston has become very aggressive," Smith said. "They've done their work and seem to have enough foresight and a good plan."
It was the highest bridge in Texas when it opened in 1959.
The new rail line would have run next to Ellington airport and skirted the north side of Clear Lake City before ending within the Bayport industrial complex just east of Red Bluff, about midway between Bay Area Blvd and Fairmont Pky. It was cancelled after an agreement was reached (in part brokered by Tom DeLay) for the 2 competing railroads to share an existing line that runs along Hwy 225 and the Ship Channel industries.
As to the Red Bluff freeway, it was at one time killed but appears to be resurrected as a 4-lane tollway that will begin construction in 2009. Some of the info I've seen suggested it might run entirely down Fairmont Pky, instead of the original plan to turn southeast down Red Bluff. However my gut says it will run on the latter corridor. Interesting that the port's Bayport master plan map doesn't show a freeway interchange for Red Bluff & 146, and all ramps into and out of the port only connect to/from the north side of 146. But I wouldn't rule out them adding ramps from Red Bluff both into the port and southbound onto 146.
Bayport master plan:
http://www.portofhouston.com/pdf/genifo/POHA-BayportMasterPlan.pdf
Bayport website:
http://www.zachrybayporteam.com/live/home.htm
Port of Houston website:
http://www.portofhouston.com/geninfo/bayportproject.html
makes sense.
the los angeles/long beach harbor is maxed out. and the traffic in the area is horrendous. this is not to say that the harbor and roads and trains could not be modernized, but with nimby's? nada.
there was a time when the mexicans wanted to build a port just south of yuma, to cut los angeles/long beach out of the action.
bringing stuff to the mid-part of the u.s. makes sense.
you can't stop progress
Excellent post.
Sounds to me that its Houston's to lose...that highway is going to give H-town the leg up to attract many businesses.
I wonder what Jacksonville has up its sleeve?
Time is money...
Indeed.
And you know Bay Area Blvd also connects to Port Rd.
I drove past the construction for Phase-I the other day, they aren't wasting any time.
I hope they use the Fairmont/Beltway corridor to 146 rather than Red Bluff.
That is a good satellite picture you had also, I saved it.
And like you said, those folks on Todville Rd down toward the project are in Pasadena and LaPort.
I wonder if the best compromise might be to end up having the freeway run down most of Red Bluff (since the land is already there and there's not the drainage issues that using Fairmont Pkwy all the way would have) but at the southern end cross the open land at the south edge of the Bayport industrial complex and put the interchange with 146 further north at Port Road? That way they wouldn't have the condemnation, noise, aesthetic(high ramps next to residences) or complexity issues of R.B./146 or F.P./146 interchanges, since all the new land required would be open land in and adjacent to an industrial area. The environmentalists would scream about the loss of wetlands, but it is really only a small sliver. I'd run it on the backside(south) border of the industries on Bay Area Blvd, then next to Port Road and the railroad tracks. That connector portion wouldn't need frontage roads, just the 4 main lines, an exit just west of Port Rd/146, and ramps to/from south 146. Local traffic to the industries can simply use the existing Bay Area Blvd, and local traffic to the residential areas use the existing Red Bluff.
Hallelujah! More cheap sh!t from China to widen our trade deficit. This isn't trade because trade is two sided.This is imports. So the port of entry moves from California to Houston and this is something to make a big deal about ?
RE:Hutchinson Wampoa
See http://www.newsmax.com/archives/articles/2004/1/6/174054.shtml for info on bid last year by the son of Hutchin Wampoa director to purchase a large portion of Air Canada. Are there any connections with Venezuela (only western hemisphere OPEC country)?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.