Role of Ports in Trade Angela Morley Jensen Yip Jake Norquist Lee Robles Ryan Martin The US Port system Waterways & Ports –More than 1,000 harbor channels –25,000 miles of inland, intracoastal, and coastal waterways. –Serving over 300 ports with more than 3,700 terminals –Links to 152,000 miles of rail 460,000 miles of pipeline 45,000 miles of interstate highways Intermodal connections –Vessels, vehicles, and system users Decision making driven by marketplace National, State, local all participate Logistics Importance of U.S. Ports Provides American businesses with competitive access to suppliers/ markets – Mainstay of global economic growth – Enables U.S. to be worlds largest trading partner Provides cost effective mean for moving bulk commodities – Grain, coal, petroleum, etc. – >95% of overseas trade in/ out moves by ship Includes 9 million barrels of oil daily Key strengths and issues – Flexibility/ ability to adapt to rapidly shifting market demands – No other system can accommodate future growth in overseas trade Other Importance National security – Vital role in mobilizing/ maintaining national security – Lifeline for equipment and supplies Environmental value – Coastal and marine ecosystems crucial for commercial and rec. fishing, wildlife watching, boating, drinking water – Environmentally responsible method of transportation Recreational value – Passenger vessels provide sightseeing, excursion, dining, gaming, cruises, etc. Questions What area of the government participates in the management, financing and operation of the U.S. port system? What is an issue that the ports are facing due to overseas trade growth? Ports and Jobs 4 Million Americans Wages are 13 - 17% higher $44 billion in personal income $16.1 billion was paid in taxes Exportation and Companies Companies are more profitable Produce twice as much Overall productivity up 12 – 16% North American Cruise Industry Very dependent on ports 30.06 billion in economic activity was generated 9 million people went on cruises 77% of global cruise embarkations were from US ports Questions Name one reason ports help jobs. Questions How does exportation help companies? Top Trading Partners Exports (Goods) Imports (Goods) Products from Top 3 Importers Canada 18.2% – Passenger cars, new and used $36.3 (in millions) – Gas-natural $26.8 – Crude oil $24.1 China 14.0% – Computer accessories, peripherals and parts $25.7 – Computers $14.4 – Apparel and household goods-other textiles $13.1 Mexico 10.7% – Crude oil $23 – Auto parts and accessories $20.6 – Passenger cars, new and used $10.8 Goods the U.S. exports to the top three trading partners Canada 22.8% – Parts and accessories of vehicles $23.5 (in millions) – Passenger cars, new and used $12 – Trucks, buses and special purpose vehicles $10 Mexico 13.5% – Electric apparatus $8.7 – Computer accessories $6.2 – Plastic materials $5.8 China 5.0% – Civilian aircraft $3.8 – Semiconductors $3.3 – Soybeans $2.2 Questions What country imports the most to the United States? What is the #1 good Imported from Canada? Current Issues Amount of trade and cargo dramatically increasing – Due to globalization – High consumption of Americans – Demand is so large that it is hard handle everything being sent to U.S. Current Issues Greater need for capital investment in port infrastructure – Shared costs between public and private sectors – 2003-Public invested $1.7B to meet shipping industry needs – Likely to increase as trade continues to increase Current Issues Vessel sizes are increasing and require larger channels – Bigger = better – Most ports have depths of 35-45 ft. Today’s large ships require depths of 45-53 ft. – Dredging adds costs and implicates the environment Disposal? Disruption to environment Current Issues Security – Ports handle essential cargoes for military operations – Gateway into the country Management of 6 U.S. ports and Dubai Ports World conflict Updating with radiation monitors, detection systems, and ID systems Questions? Name 1 reason why the amount of trade has increased with ports? Globalization, U.S. demand and consumption Questions? Why are people concerned with the environment when talking about ports? Dredging, harmful effects on natural eco- systems, disposal of dredged material Why managers should care Ports serve as a gateway to goods – Both coming in and going out – 95% of goods are in same way linked to ports A part A raw material, etc. Can cause major problems – Possibility of bottlenecks – Strikes A strike could put an entire company out of business Summary Type of products Volume of trade Imports Exports Sources Meserve, Jeanne. "Ports Company Will Delay Takeover." CNN.Com. 24 Feb. 2006. CNN. 29 Apr. 2006 <http://www.cnn.com/2006/POLITICS/02/23/port.security/?section=cnn_us>. "Press Room." US Department of Homeland Security. 22 Feb. 2006. 29 Apr. 2006 http://www.dhs.gov/dhspublic/display?content=5437. "The Dredging Process." EPA. 15 Mar. 2006. 29 Apr. 2006 <http://www.epa.gov/owow/oceans/ndt/s1.html>. "US Public Port Facts." AAPA. 2006. American Association of Port Authorities. 29 Apr. 2006 <http://www.aapa-ports.org/industryinfo/portfact.htm>. "Mineta Underscores Role of Ports in Global Transportation." Primezone. 7 Oct. 2005. 29 Apr. 2006 <http://www.primezone.com/newsroom/news.html?d=87533>. "Business Services." U.S. Department of Transportation Maritime Administration. 5 Oct. 2005. 29 Apr. 2006 <http://www.marad.dot.gov/business/index.html>. "Marine Transportation System." Department of Transportation. Sept. 1999. 28 Apr. 2006 <http://www.dot.gov/mts/report/mtslinks.pdf>.