Gulf Coast ports sense change in shipping traffic

A steamboat captain needed a machete to reach this "port" city in the mid- 1800s. Navigating Buffalo Bayou required a keen eye to avoid sand bars and alligators, and a strong arm for hacking away vines and brush that clogged the waterway as it narrowed near Houston, 50 miles inland.

Today, there is still congestion. But it owes to heavy shipping traffic along the widened and deepened Houston ship channel, not bayou wildlife.

Business is good along the Houston waterfront, as it is at most of the Gulf Coast ports. The reason: they trade heavily in grains and energy-related products and equipment, which are relatively resistant to downturns in the national economy.

"Our biggest commodities are food and energy [products and equipment]," declares Richard P. Leach, executive director of the Port of Houston.

Indeed, grain is the top export commodity in terms of tonnage for the ports of New Orleans and Houston, the nation's second and third largest ports in total cargo movement, according to the most recent figures from the US Army Corps of Engineers.

President Carter's embargo of grain sales to the Soviet Union announced earlier this year caused some temporary disruptions in grain movement. "But the surplus seems to have found its way into the world market," noted Henry G. Joffray, associate port director in New Orleans.

World demand for US wheat, rice, and other grains is expected to rise smartly over the next decade. The greater New Orleans area, the mouth of the Mississippi River to Baton Rouge, is already the largest grain export region in the world, according to Mr. Joffray. Yet grain elevator capacity in the area will have to double to meet demands for 100 million tons of exports annually in the next 7 to 10 years, he predicts.

Petroleum is the top import commodity at Houston, New Orleans, and several other ports that serve the oil refineries concentrated along the coast of Texas and Louisiana.

Oil shipments do not generate much revenue for Gulf ports because they usually are handled at private terminals. And the projected 1981 completion of the nation's first deepwater port -- the Louisiana Offshore Oil Port (LOOP) -- will significantly reduce oil imports to all coastal port facilities.

But petroleum imports have been highly beneficial in attracting energy-related industries, like petrochemical plants, to the region and thereby generating other business for Gulf Coast ports. So even as oil shipments to the US decline as they have so far in 1980, or are diverted to LOOP, Gulf port officials do not see much adverse impact on their overall trade.

If anything, tighter world oil supplies are expected to be a boon for Gulf Coast ports. The general acceleration in oil and natural gas exploration worldwide is boosting export of US-made drilling and production equipment. Much of it is manufactured in the oil patch states of Texas, Louisiana, and Oklahoma.

"We've generated tremendous movement of oil industry equipment" from the US Gulf region, noted Dow Wynn, president of the Gulf Ports Association and port director of Port Arthur, Texas. He foresees great expansion in the next decade of energy industry equipment and technology sales to Mexico as that country exploits its rich oil reserves.

Too, there is increased talk of coal exports along the Gulf, as the world looks for fuel alternatives to oil and natural gas. The US Department of Energy established in April a national coal export task force to set targets for "substantially increasing" steam coal shipments overseas.

The recent world coal study forecast a potential tripling of world coal production by 2000. The US could play an important role in such an expansion with its abundant coal reserves, and some see the Gulf region as gaining most of any new steam coal export business.

"The Gulf Coast ports will be in a great position because the East Cost ports are already so congested. You're already seeing a shift in overseas customers buying coal that does not have to go through the busy Eastern ports," noted Connie Holmes of the Coal Exporters Association in Washington.

New Orleans and Mobile, Ala., are particularly keen on increasing coal shipments. Mr. Joffray calls coal "one of the biggest growth markets we see."

The port of Mobile is spending $20 million to double its coal storage and handling capability over the next five years.

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