Calif. port volumes down in 2008
California's three major container ports all reported significant declines in cargo volume during 2008 reflecting the ongoing deterioration of international trade being exacerbated by the unraveling of the global financial markets.
Containerized cargo volumes at the ports of Long Beach and Los Angeles dropped a collective 8.5 percent in 2008, bringing to an end nearly two decades of continued growth at the busiest container port complex in the Western Hemisphere.
The two adjacent ports, which handle more than 40 percent of the containerized cargo moving into the United States, moved a combined 14.34 million TEUs last year, compared to 15.67 million TEUs in 2007.
The overall decline in container traffic was mirrored at the Northern California Port of Oakland, the nation's fourth-busiest container port, which reported a 6.3 percent drop to 2.24 million TEUs.
Individually, the Port of Long Beach reported total volume for 2008 down 11.3 percent to 6.48 million TEUs. Loaded imports were off 13.9 percent at 3.19 million TEUs. Strong first half export volumes offset an export box collapse in the final quarter, with the port reporting loaded export boxes up 7.2 percent for the year to 1.69 million TEUs. Empties dropped 20.8 percent to end the year at 1.61 million TEUs.
'While 2008 was a difficult year for the maritime industry, the Port is firmly committed to investing in improvements that will provide new, local jobs, stimulate the local economy, protect the environment and improve security,' said port Executive Director Richard D. Steinke.
Next door, Los Angeles officials reported total 2008 volumes of 7.85 million TEUs, off 6 percent compared to 2007. Loaded import containers ended the year down 6.6 percent at 4.4 million TEUs. Loaded export containers were up 10.8 percent to 1.8 million TEUs. Empties dropped 17.5 percent to 1.9 million TEUs.
In December, Los Angeles port Executive Director Geraldine Knatz warned that if port projections play out, the first quarter of 2009 may see drop-offs in volume of 20 percent to 30 percent. Such a decline would force the port to take serious belt-tightening actions, she said.
'If 2009 goes as forecasted, we will need to push off starting some new capital projects until economic conditions improve,' Knatz told the port's governing board. 'This is not a time to try and finance capital construction through borrowing.'
Knatz listed three budget priorities for the port in 2009:
' Tenant revenue-generating projects.
' Projects that benefit the port authority and its employees.
' Previously committed 'community-priority' projects.
'We may have to forego things that do not fall within these three categories for some time,' Knatz said.
In the Bay Area, the Port of Oakland ended the year down 6.3 percent, with monthly losses being reported in 11 of 12 months throughout the year. Oakland officials reported loaded import containers fell 8.4 percent to 769,906 TEUs. Loaded export containers, which fell by double-digit percentages during each of the last three months of the year, ended 2008 at 912,480 TEUs, an 0.3 percent increase over 2007. Empties also ended the year down, falling 12.5 percent to 531,858 TEUs.
The port authority, which also operates the Oakland International Airport, is already predicting lean times ahead. Two weeks ago, port officials predicted 2008-2009 fiscal year revenues of $298.7 million would fall $12.1 million short unless costs reductions are implemented or revenues are increased.
“The global economic crisis has redefined what we are able to do,” port spokesperson Marilyn Sandifur told the Oakland Tribune. “The port’s situation is very different today than it was a year ago or even three months ago.”
Port commissioners voted in mid-December to temporarily layoff 54 percent of the port's workforce for 13 days during the fiscal year, saving the port $1.3 million. The port has already eliminated 100 positions, leaving a staff of about 575.
Other possible costs saving actions being looked at are $4 million in cuts to personnel, a 1 percent annual growth cap on expenses, and the reduction or delaying of capital improvement projects at the port.
According to port officials, about $11 million of the projected shortfall is due to the aviation division of the authority, with the remaining $1.1 million being attributed to the maritime division. ' Keith Higginbotham