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 % 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  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 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 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 Current Issues  Vessel sizes are increasing and require larger channels –Bigger = better –Most ports have depths of ft. Today’s large ships require depths of ft. –Dredging adds costs and implicates the environment  Disposal?  Disruption to environment

Current Issues 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 CNN. 29 Apr  "Press Room." US Department of Homeland Security. 22 Feb Apr  "The Dredging Process." EPA. 15 Mar Apr  "US Public Port Facts." AAPA American Association of Port Authorities. 29 Apr  "Mineta Underscores Role of Ports in Global Transportation." Primezone. 7 Oct Apr  "Business Services." U.S. Department of Transportation Maritime Administration. 5 Oct Apr  "Marine Transportation System." Department of Transportation. Sept Apr