Planning for Container Growth Along the Houston Ship Channel and other Texas Seaports TxDOT Project 0-5068 Robert Harrison Center for Transportation Research February 3, 2007 Project Scope Analyze current state of container handling practices in Texas Predict growth in future container volumes Isolate strategies to better manage growth Predict impact on port and landside infrastructure 1
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Dramatic increases in projected freight demand 1,776 2,557 Seattle 1,798 4,396 Tacoma 2,043 3,382 Oakland (TEUs in thousands) 2004 2020 13,101 59,420 LA/LB Volume of trade, 2004 and 2020 1,437 6,165 Houston 1,010 2,152 Miami 4,478 15,835 NY/NJ 5,566 1,809 Virginia 1,860 6,639 Charleston 1,662 9,420 Savannah Forecast figures based on a 10-year linear regression 6
Background for Container Growth Estimates Status of the global shipping market Trends in port and ship capacity - 10,000 TEU vessels will be delivered in 2007 - Rapid expansion of Port Capacity in China. - India attempting to overcome infrastructure deficit Improvements in ship and port technologies are coupled with new processes that could help to manage growth - Crane double cycling - Automation Container Growth at the Port of Houston TEUs 1,800,000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0 1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 Year 1990 1992 1994 1996 1998 2000 2002 2004 Each bar represents the total annual TEUs handled. The dotted line is the moving average while the solid line is an exponential trend line. 7
Port of Houston compared to selected large container ports (2005) Port of Long Beach: 6,709,818 Port of New York and New Jersey: 4,792,922 Port of Seattle: 2,087,929 Port of Houston: 1,584,100 Asian trade has increased to nearly a fifth of all container trade at POH - in only three years 5% 6% 2000 89% Atlantic Pacific Rim South Asia 7% 2005 19% 74% Atlantic Pacific Rim South Asia 8
Chinese trade has exploded - and dwarfs that of other Asian nations at Port of Houston 160000 140000 120000 100000 80000 60000 40000 20000 China Japan Hong Kong Taiwan South Korea South Korea 0 1999 2000 2001 2002 2003 2004 Hong Kong China 2005 Chinese trade now accounts for a large - and increasing - proportion of yearly container growth at POH 2000000 49.90% 1800000 1600000 1400000 13.14% 21.24% 21.24% 70349 141013 1200000 13229 33704 2110 2195 1456 1000000 800000 1440478 1582081 600000 1028961 1059330 1056413 1134260 1210162 400000 200000 0 1999 2000 2001 2002 2003 2004 2005 9
If current trends continue, the POH will grow to the current size of today s largest ports 7000000 6000000 1990 1992 Long Beach 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 5000000 4000000 New York/New Jersey 3000000 2000000 1000000 Seattle 0 1999-2004 Grow th Rate (7%) 4% Average Annual Grow th 10% Average Annual Grow th The I-710 Freeway in 2004 10
The Alameda Corridor in 2004 11
The Port Terminal Railroad Association (PTRA) Systems Initial Findings Options to Improve Conditions Draft Recommendations and Costs Study Focus Internal Rail Port Services and Market Demand Access problems to and from the port s main door that inhibit port have negative impact on internal port railway efficiency Internal port railway capacity problems 12
Initial Findings Pasadena to Harrisburg & Manchester Jct single track restricts train movements Barbours Cut approach and yard already at capacity Single track access to the north restricted between port access door and Englewood Yard Track at capacity to the west and NW via Rosenberg Impacts directly on Barbours Cut biggest customer Track at capacity to the south via BNSF & Hobby airport area Options to Improve Conditions Recommendations consistent with last year s report Train delay is the major cost Also the major railway benefit if fixed Train caused delays to highway commerce and the traveling public from restricted railway port approach with long slow moving trains is also the major public cost Also the major public benefit if fixed A few rail passing siding additions and some limited double track will bring the benefits (and railway operating savings) 13
Cost Estimates Total Under $50 Million $15 to $20 Million for port approach sidings $10 to $15 million for Englewood double track Balance for the doublestack and Pasadena doublestack improvements No estimate yet for Strang branch container port access Road Corridor Connections to POHA Truck container movements from the POHA depend on several key road corridors including Barbours Cut Blvd, SH 146, SH 225 and 610 in order to access local distribution centers and rail yards. Report addresses planned improvements in each of these corridors. 14
Improvements to SH 146 Links Barbours Cut to SH 225 will become even more important once Bayport opens Current major investment study calls for capacity expansions to meet expected growth of between 60% to 100% through 2022 Would provide 6 general purpose freeway lanes with frontage roads for the segment of the corridor linking red bluff road to Fairmont parkway Construction is expected to begin in 2010 with full buildout by 2020 Improvements to SH 225 Primary corridor for trucks transporting containers from Barbours Cut Most sections of the roadway are still significantly under capacity Plans call for no significant expansion of the mainlanes through the study horizon TxDOT plans on eliminating the left hand exit bottleneck that causes congestion where 225 meets 610 TxDOT considered but rejected for the time being options such as no build, truck only toll lanes, HOV, and commuter rail 15
Examination of Drayage at POHA To Houstonians, container growth at the port will be manifested in the form of more trucks on the roadways Important to learn more about delay patterns and routes chosen by drivers Need for more information on drayage fleet Port does not keep detailed information about truck operations outside port gates Survey Results On average, drivers work 55 hours per week Average dray length is 46 miles Average number of trips to the port per day is 3.2 75% own their own truck Almost 90% belong to a trucking company Drive on average 60,000 miles per year Substantial variation truck mileage profile with largest cluster between 600-900 thousand miles. 16
Houston Dray Fleet Age Profile 25.0% Percentag e of Driver's Vehicles 20.0% 15.0% 10.0% 5.0% 0.0% Under 100 100-200 200-300 300-400 400-500 500-600 600-700 700-800 800-900 900-1,000 Over 1,000 Thousands of Miles Houston Distribution Centers Distribution centers in Houston classified as small-box (under 100,000 sq ft), midbox (100,000-400,000) big-box 400,000-1,000.000, Mega-Box over 1 M. Often used to consolidate freight that can be part of transnational shipments Can be strictly for distribution, a combination of distribution center/warehouse, or a container freight station 17
Locations of Warehousing/Distribution Centers & Existing & Potential Intermodal Rail/Terminals in the Inland Empire Meeting the Transportation Challenges of the 21st Century: Intermodal Opportunities in the Appalachian Region Case Study Exhibit 4.2: Port of Charleston Container Traffic (Origin and Destination Concentrations) 18
Meeting the Transportation Challenges of the 21st Century: Intermodal Opportunities in the Appalachian Region Case Study Exhibit 4.3: Map of Potential SCIP Generalized Locations DC s in the Houston Area Import distribution centers in the Port of Houston area are predominantly privately owned facilities and are operated by a third party logistics provider. Many are located near the city center Location decisions for new DC s based on road and rail access, land value and productivity. Some smaller container freight stations generate comparatively high numbers of truck trips and VMT Examples: 200,000 sq ft CFS produces 4 million annual VMT in the Houston area 19
Logistics Park-Alliance APM Norfolk Terminal 95% of all trucks will be serviced within 11 minutes 20
Heartland Corridor Route Next Day Service to Columbus Reduce Transit to Chicago by 1 Day Will Shave Approx. 225 Route Miles Off Each Container Move to Chicago Greater Efficiencies High Speed Double Stack Current DS Route Secondary DS Route Current Single Stack Route Port-Heartland High Speed Doublestack Corridor Conclusions Container Growth In the next two decades, Texas should expect to see robust growth in maritime containers This trend is driven by economic and population growth, the growth of maritime trading partners, and technological advances in intermodalism Despite significant challenges ahead, it appears that Texas will have adequate capacity to handle this growth and will have an advantage over competing regions 21
Conclusions Rail issues Rail efficiency remains a weak link with several problems specific to the region Proposed system of grade separations would significantly improve Houston system velocity and would broaden the customer based for rail intermodal shipments leaving Houston. Improvements to Houston rail network and PTRA are being driven primarily by noncontainerized commodities. Conclusions Road Corridors Successful rehabilitation of Barbours Cut Blvd is critical and will require careful planning to avoid construction related bottlenecks SH 146 master plan should be periodically re-evaluated based on container growth Barbours Cut, Bayport and Texas City SH 225 improvements should be sufficient for handling expected growth rates 22
Conclusions Dray and Distribution Center Network Improving dray operations a key strategy for improving overall port efficiency Understanding the function of distribution centers is key to projecting impacts of containers on the road network. 3208 Red River Austin, TX 78705 (512) 232-3100 www.utexas.edu/research/ctr 23