Houston

Three quarters behind us and one to go before we see a better year economically. Never mind the anti-wealth rallies, the stubborn unemployment rate and the deficit gloom and doom, for next year’s projected GDP growth in the United States will be 50% higher than this year’s. I suppose that makes sense when one juxtaposes September’s vessel arrival numbers for the Port of Houston which registered a modest 2% increase over August. On the other hand, total vessel arrivals in Texas ports were over 4% off – a rather odd situation since the latter half of September kicks off the holiday season inventory influx. Arguably, cautious retailers can translate into last-minute ordering by regional bosses. Consequently, the double digit decreases in the bulk of the larger ports in September may be offset by more robust October maritime commerce into the State. So let’s dig a bit and see what hand we have been dealt.

The good news is that year to date every port – with the exception of Freeport – continues to outperform 2010. Texas City led this month’s pack with a 10.5% month-to-month increase. That’s where the silver lining ended as further to the east in Sabine traffic was not as robust with a 12% monthly decrease. Shifting to the west, things were even less heartening as Galveston dropped 29%, Freeport was off 23% and Corpus Christi dipped nearly 16% for the month. Corpus Christi did retain its overall percentage lead as it remains 11.6% higher than last year.

Houston’s vessel specifics portray a rather interesting mix of results. While general cargo and container ships were down 6% and 5.5% respectively, bulk vessels and car carriers were up 16% and 25% respectively. Flattening demand and languid crude pricing most likely contributed to the 3% drop in tankers but LPG movements rebounded from the previous month’s decrease with a 6% increase over the August to September period. Yet, when all those numbers are set aside, there is one that is screaming for attention – CHEMICAL TANKERS! After four consecutive months of rather anemic numbers (i.e., 61 to 69), it crushed the competition with a 46% monthly increase. Just how strong was this number? It eclipsed its previous best month of the year by 25%. An aberration? To some degree, given the fact that there have only been two rather strong months this year (i.e., March & April); however, the combination of a weak dollar and desire to stockpile manufacturing components appears to justify the triple-digit-arrival number.

Has this shed any additional light on how the year will end? It’s hard to tell so let’s throw in two additional data points: Houston Ship Channel tow movements and private dock activity. The former number was off 3% for the month but the latter put up all the gains in Houston for the month with a 2.5% increase. Granted, the majority of the private terminals did not experience any monthly increase vis-à-vis vessel arrivals. Translation – there are some signs of growth out there but a tepid September does not make for a robust October. All in all, it could have been better and - if 2012 is forecasted to produce a 2.7% GDP increase - it should have been better. No matter, the holiday season will soon be upon us and we can all look forward to a better year.