Room to grow

Room to grow
U.S. imports from Middle East pale in comparison to other regions. Is that set to change?

By Eric Johnson

      The Middle East is fast becoming a starting and ending point for global container trade, not just a way station on the way from one region to another.
      But the reality is that Middle East/North America trade has barely scratched the surface of what it could become, as evidenced by statistics provided to American Shipper from Zepol Corp.
      Zepol's statistics measure inbound containers using U.S. Customs data straight from carrier bills of lading, showing the point from which carriers took possession of the goods.
      And there we see the Middle East port providing the most U.S. import volume was Jebel Ali, with only 11,808 TEUs in 2009. To put that in perspective, the Chinese terminal providing the most U.S. import volume in 2009, the Yantian terminal complex in the Port of Shenzhen, drove nearly 2.2 million TEUs of cargo to U.S. shores.
      Looking more broadly at the Middle East region ' to include eastern Mediterranean ports like Port Said, Haifa and Beirut ' the numbers still pale. The top 12 ports in the region for U.S. imports provided 145,655 TEUs collectively in 2009.
      Those 12 ports, if their U.S.-bound volume were totaled, would only be the 14th-largest provider of U.S. imports from the Far East.
      Middle East volume to the United States from certain ports was dented by the economic downturn last year, bucking a larger trend that saw the Middle East ports fare better than in any other region last year. But some terminals grew even as overall demand slid.
      Dubai originating volume to U.S. ports fell 22 percent in 2009 (not counting volume collected directly at Jebel Ali, which actually grew 2 percent, to 5,580 TEUs). Port Said's U.S.-bound volume dropped 42 percent, but it increased by 36 percent though the nearby Suez Canal Container Terminal.
      More than any one Middle East port, Israel's ports are the clear leaders in terms of U.S. imports. Haifi (quite clearly a Mediterranean port) led the regional table, with 59,776 TEUs in 2009, though its U.S.-bound volume has been dropping steadily the past four years, not just during the downturn.
      The Israeli port of Ashdod is the sixth-largest U.S. import driver in the broader region, while big-name ports in the Middle East like Salalah is 11th and Jeddah barely cracks the top 15.
      It's clear the ports in the heart of the Middle East ' like those that ring the Persian Gulf and the Arabian Peninsula ' are focused more on neighboring trades with better prospects for growth, like to East and West Africa, and the Indian Subcontinent.
      It also can't be ignored that the Middle East lies directly in the path of the Asia/Europe trade lane, and thus container flows to Europe and Asia would inevitably be more substantial than to North America. Again, Zepol statistics capture only U.S.-bound import information.
      As far as which products are moving from Middle East ports to the United States, it varies depending on the country. Pharmaceuticals were far and away the largest U.S. import category from Israel, while clothing and textiles were the biggest import from Egypt and Jordan, plastics and petrochemicals the biggest category from Saudi Arabia.
      But it can't be ignored that Middle East volume to the United States lags well behind that of other regions. Whether there are natural barriers or ceilings to trade from Middle East ports, or whether there is massive potential for growth is unclear.
      Perhaps if trade between the Indian Subcontinent and North America grows ' with the Middle East on the way ' and manufacturing in places like Egypt and Saudi Arabia expands, the import numbers from the last five years might look paltry in comparison.