The Value of Texas Seaports in an Environment of Increasing Global Trade

(PI: Rob Harrison, CoPIs: Nathan Hutson and Peter Siegesmund; collaborative project with James Kruse of Texas Transportation Institute)

The U.S. Gross Domestic Product (GDP) has increased dramatically in the past 20 years, enhancing the nation’s role in the global economy. Texas seaports play an important role in both the state and national economies as export and import gateways for a wide variety of sectors of the U.S economy. In 2004 the Bureau of Transportation Statistics reported that 39.4 percent of the value of U.S. international merchandise was traded via waterborne shipping. At present, four Texas deep-water ports (Houston, Beaumont, Corpus Christi, and Texas City) rank in the top ten U.S. water ports by shipment weight.

The increase in international trade, oil prices, and population has further increased the demand for waterborne commodities. An increase in containerized imports from developing Asian economies has, at times, overwhelmed port capacity on the West Coast and led shippers to examine gateway alternatives, such as Texas ports. As ports become more congested and extend their hours of operations, the logistics of maintaining ports have become more complicated. The true cost of deferring maintenance is often not realized until the cost of corrective actions becomes high. The emergence of mega-containerships, the consolidation of shipping lines, and the growing size of distribution centers have all been positive developments for commerce. However, these developments make ports more vulnerable if they allow their infrastructure to stagnate.