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As with other ports across the planet, the Port of Houston is dealing with supply chain challenges.
“We’re not immune to what the other ports across the country are facing,” said Lisa Ashley, the port media relations director. “It’s a global issue.”
Port of Houston Executive Director Roger Guenther told KPRC-TV that a shortage of workers is a major reason for a clog in the supply chain. Ports across the country are reporting a shortage of storage space along with a need for more truck drivers.
“A lot of people that left the workforce didn’t return to the workforce, like those that work in the distribution centers where this cargo is ultimately going,” Guenther told KPRC. “They’re coming off the ship faster than they are leaving the terminal.”
He also noted a massive upturn in online shopping, which led to a greater demand for shipping. Guenther has worked at the port for 30 years and has been executive director since 2014.
Ashley said the COVID-19 pandemic is at the root of the problem.
Houston gets a “significant amount of goods” from the Asian trade lane, so when manufacturers and ports shut down, it was impacted, she told Houston Daily. As production picked back up, American ports were unable to process the flood of goods entering the country, according to a CBS News report.
“It just has implications that are long term,” Ashley said. “The congestion issues that the supply chain is seeing is a very complex scenario. This is the situation that we're seeing right now.”
Ports already overwhelmed with cargo are also experiencing issues with a trucker shortage.
“Consensus in the industry is we’re unlikely to see a cleaning up of the situation until deep into next year,” Brian Sondey, chief executive of Triton International, told Financial Times.
The Port of Houston had its biggest June ever, with a total of 292,627 20-foot equivalent unit (TEUs), a 39% increase from 2020. It also was the biggest month in port history for loaded imports, with 139,488 TEUs.
Imported goods in the United States increased 20% year over year as of July 2021, and grew 11.5% since 2019.
In August, imports in the United States jumped $4 billion from July — an increase of 1.4%.
Ashley said the Port of Houston is one of many locations facing the same challenges.
“We're part of the global process,” she said. “This is not a Houston issue. This is a global supply chain issue that we're just a part of that. We’re not immune to what the other ports across the country are experiencing. It’s a maritime logistical matter that is being addressed, just as we do normally.”
She said Houston and the state of Texas have been supportive.
“We've always had very good communications with all of our partners,” Ashley said. “From the very beginning, they've been very engaged and aware of the impact that the pandemic has had and what it means to the supply chain, and the port itself.”
In September, Morten Engelstoft, chief executive of Maersk-owned APM Terminals, said that a rapid increase in demand has created a “vicious circle” that is putting strain on all parts of the supply chain. Engelstoft’s solution to solving the supply chain issues is for individuals to break the cycle and lessen their demand.
“We need lower [consumer demand] growth to give the supply chain time to catch up, or differently spread out growth,” he said. “Over a long period of time, we will need to recover efficiency.”
Engelsoft argued that the rapid rise in consumer demand coming from the United States was the source of the strain. He did admit, however, that ports need to invest to improve their infrastructure.
The Port of Houston, which has been in operation for more than a century, includes the Houston Ship Channel complex and more than 200 public and private terminals. It is the nation’s largest port for waterborne tonnage and an essential economic pillar for Houston, Texas and the United States.
“The Port of Houston supports the creation of nearly 1.35 million jobs in Texas and 3.2 million jobs nationwide, and economic activity totaling $339 billion in Texas — 20.6% of Texas’ total gross domestic product— and $801.9 billion in economic impact across the nation,” according to its website.