By Nicole Cornett, Managing Editor, Expansion Solutions Magazine
Growth in U.S.-international trade accelerated at an unprecedented pace in response to the spike in consumer demand during the COVID-19 pandemic. The United States is one of the world’s largest trading nations, with nearly $6 trillion in exports and imports of goods and services from the latest available 2021 data.
Of the total U.S. international trade of goods and services, the import and export of goods alone exceeded $4.6 trillion (77.4 percent) in 2021, up from $3.8 trillion in 2020. The Nation’s ports handled 41.1 percent (over $1.8 trillion) of the U.S. international trade by value in 2021. U.S. imports of goods grew by almost $506 billion or 21.5 percent while the export of goods grew by more than $329 billion or 23.0 percent between 2020 and 2021.1
Waterborne vessels are the leading transportation mode for U.S.-international trade in goods. Vessels have transported U.S.-international freight at record levels, with cargo value peaking at more than $205 billion in May 2022—up $105 billion from the $100 billion low recorded in May 2020.2
Unprecedented seaport congestion has reinforced the importance of infrastructure improvements to create efficiencies and better manage container flows. Supply chain challenges and performance of the freight transportation system have affected the U.S. economy since the onset of the COVID-19 pandemic while container ports continue to be burdened by shortages, including but not limited to intermodal shipping containers and chassis, as the demand for ocean shipping and port services exceeds supply, contributing to disruptions throughout the supply chain.
Data from Descartes Datamyne indicates that West Coast ports are once again gaining market share. In December 2022, top West Coast ports reversed their market share decline versus top East and Gulf Coast ports.
Descartes data shows that total import container volume at West Coast ports grew to 38.1 percent in December 2022, up 1.2 percent versus November 2022, while the East and Gulf Coast ports declined in December 2022 to 45.5 percent, down 1.7 percent versus November 2022.
On the West Coast, the focus is to optimize existing assets to provide high capacity on the same footprint and to improve capability through berth and channel deepening.
The congestion seen at West Coast ports over the past two years is no longer an issue, as import volumes declined over the second half of 2022, and the ports of Houston and Savannah, which saw congestion build up in 2022, are almost back to normal. After a 15 percent surge in imports in 2021, 2022 was a year of transition, with year-on-year growth in the first half followed by declines in the second half.
Both Gulf and East Coast ports saw a record setting year in 2022, even with volume declines in the second half. Global Port Tracker found that at East Coast ports, import volumes remained high and exceeded 2021 levels throughout the first three quarters.
The Port of New York and New Jersey became the second largest port destination for 2022 and even surpassed Long Beach/Los Angeles for most of the second half of 2022. Nevertheless, reports indicate that 2022 volumes still marked the second busiest year on record for West Coast ports.
New York/New Jersey recorded nearly 9.5 million TEUs for 2022, the highest in its history. The Port of Los Angeles weighed in at over 9.9 million TEUs, while Long Beach tallied 9.13 million TEUs. Cargo volumes at the Port of New York and New Jersey declined in the latter half of 2022.
On the Gulf Coast, primarily Port Houston, Global Port Tracker reports that import volumes remained high throughout 2022 with double-digit percentage year-on-year growth through October 2022. The year with a 17.3 percent increase in loaded imports and an 18.7 percent increase in loaded exports. Like East Coast ports, the Gulf Coast benefited from the cargo diverted from the West Coast and shifts by shippers to diversify supply chains.
Georgia Ports Authority’s (GPA) Port of Savannah is increasing rail capacity, deepening, and straightening existing berths at its Garden City Terminal to increase capacity for the larger vessels, and transforming the current multipurpose ocean terminal to accommodate container trade.
Georgia Ports Authority continues to develop rail hubs around the state and is gaining momentum, with federal environmental approval for an inland terminal near Gainesville. Georgia’s expanding network is increasing rail capacity and connectivity between the port and major manufacturing sites around the state which will ease interstate traffic and reduce the carbon footprint of the state’s logistics industry by making the most efficient use of Georgia’s logistics infrastructure.
GPA recently received NEPA (National Environmental Policy Act) approval for the Northeast Georgia Inland Port in the Gainesville-Hall County area. The Authority will now finalize a grant agreement with the U.S. Department of Transportation Maritime Administration, and then move on to construction. GPA has been awarded a grant of up to $46.8 million to build a new inland container port along the I-85/I-985 corridor. The project is set to begin in July, with terminal construction scheduled to begin January 2024 and complete by July 2026.
Georgia Ports anticipates the inland rail hub will open with volumes of 60,000 containers per year. With the roundtrip truck route totaling 602 miles, this opening volume would alleviate approximately 36 million truck miles on Georgia highways in the terminal’s first year of operation. GPA estimates 46 of truck traffic between Northeast Georgia and Savannah will use rail instead. Cargo moving to the region by rail will reduce truck use from seven hours to less than 30 minutes. The shift will avoid 1.6 billion tons of carbon dioxide (CO2e) emissions by 2054.
For the east coast, the Administration will invest $69 million to improve navigation and expand capacity at Port of Virginia’s Norfolk Harbor, which handled 67 percent more containers in 2021 than it did 10 years ago. Work will include deepening and widening the harbor’s shipping channels to improve navigation and enable safer access for larger commercial and naval vessels, and to provide significant new economic opportunities to the region. The Port of Virginia is working on a dredging project, a rail yard upgrade, and a $650-million investment to upgrade and expand Norfolk International Terminal.
The top 25 tonnage U.S. ports combined handled a total of 1,744 million tons of cargo. The highest tonnage figures are associated with ports, such as the ports of Houston, South Louisiana, and Corpus Christi, that handle large quantities of both liquid bulk cargo and dry bulk cargo.
In 2020, Houston was the top tonnage port, handling about 276 million short tons of cargo.3 Currently, the port of South Louisiana is in the top spot and handled 146 million short tons, by far the greatest volume of dry bulk cargo, more than three and four times the amounts handled by the ports of New Orleans and the Plaquemines.4
Most Gulf and East Coast ports are focusing on equipment updates, software enhancements, and improvements to accommodate the massive new containerships on order. A record 2.5 million TEUs of new containerships are scheduled for delivery this year.
Experts expect port waiting time and congestion to return to pre-pandemic levels over the course of 2023, thanks to reduced cargo demand, due to lower economic growth combined with a resumption of more normal seasonality. Signs of the latter are clear in the first few weeks of the year which heralds more predictable times, though continued use of blanked sailings will add to average berth times.
Sources:
1 U.S. Department of Transportation, Bureau of Transportation Statistics analysis of U.S. Census Bureau, U.S. Import & Export Merchandise Trade Statistics, available at Foreign Trade: Data – Historical Series (census.gov) as of November 2022.
2 U.S. Department of Transportation, Bureau of Transportation Statistics, based upon U.S. Department of Commerce, Census Bureau, USA Trade Online, available at USA Trade Online (census.gov) as of September 2022.
3 U.S. Department of Transportation, Bureau of Transportation Statistics, based upon 2020 data (most recently available), U.S. Army Corps of Engineers, Waterborne Commerce Statistics Center. Special tabulation as of November 2022.
4 U.S. Department of Transportation, Bureau of Transportation Statistics, based upon 2020 data (most recently available), U.S. Army Corps of Engineers, Waterborne Commerce Statistics Center. Special tabulation as of November 2022.
