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Supply Chain Managers Face New Shift in Leading Ocean Cargo Gateways

As noted in yesterday's report, Jones Lang LaSalle’s Seaport Index suggests a new definition of "Top Ports" in the U.S.
By Patrick Burnson, Executive Editor
July 09, 2013

Having surpassed the California ports to claim the top spot in the index in 2012, the Port of New York and New Jersey ranked first again in 2013, this year by a rapidly-widening 9-point margin, followed by the ports of Los Angeles and Long Beach.

As noted in yesterday’s report, Jones Lang LaSalle’s Seaport Index suggests a new definition for “Top Ports” in the U.S.

“The ports that succeed in our index are the shipping destinations best able to adapt to challenges of serving larger ships, expanding efficiencies and capacity while managing the ups and downs of a volatile global marketplace,” said Rich Thompson, Managing Director of JLL’s Ports Airports and Global Infrastructure (PAGI) group. “The industrial real estate market in New Jersey offers more options for retailers that need to both store and distribute inventory immediately after it comes off the ships.”

The highest ranking seaports in the index benefit from the following three primary factors:

1. Population Density Proximity. The warehouse and distribution center markets bordering the ports in the Los Angeles and New York regions serve considerable super-regional populations. In the case of New York / New Jersey, the surrounding metropolitan population totals 30.9 million, and 80 percent of imports stay within 260 miles of the port.

2. Real Estate Availability. Overall, the seaport markets continue to lead the broader industrial real estate market, making port-centric locations of perennial interest to investors in this property type. To help alleviate demand for big box space, national industrial construction is up 50 percent from one year ago and inland ports are being developed to provide an alternative to on-port warehouse and handling space.

3. Improved Infrastructure. The winner in this category is the Port of Los Angeles owing to its large and fast-growing container volume, rail connectivity and post-Panama expansion preparation. On this metric, New York / New Jersey is second while Long Beach, Savannah, and Baltimore round out the top five.  A few other ports, such as Miami, are also undertaking major infrastructure improvements to improve connectivity and accelerate their competitive market positioning.


When it comes to second-and third-tier ports, the rankings were shuffled: Savannah continues to lead the second tier of ports in the Index, followed by Baltimore and Jacksonville. The third tier has Charleston in the lead, followed by Tacoma and Virginia.  Charleston and Virginia switched places compared to last year’s rankings. The good news for port executives and industrial real estate investors is that several second and third tier markets have projects underway that—upon completion—will eventually provide users with more options. For example, Miami is developing a new tunnel and rail system that will give the port easier access to 74 percent of the U.S. population.

“As larger ships with double the capacity make calls on our U.S. ports, one of the real differentiators will be the ports ability to improve their throughput and to move those containers more efficiently and effectively from the ships to the major distribution centers and population hubs,” said Thompson.


About the Author

image
Patrick Burnson
Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).

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