California: light at the end of the funnel For a generation California has been the end of the funnel for goods coming in from Asia. However, with the advent of the Great or at least near-Great recession, California’s ports were hit hard on the inbound side and even with exports. But in 2010, there is promise that the economy is recovering, and that once again goods will funnel through California for distribution throughout North America. By George Lauriat, AJOTCalifornia’s ports have for the past twenty years represented the primary entry port for goods distributed all over North America. The San Pedro ports of the Port of Long Beach and Port of Los Angeles have become America’s port of entry for Asian goods. Up until the recession, near double digit growth was a given, and the problem of keeping up with the ever increasing flow of goods was the challenge for the Southern Californian port duo. In the Port of Oakland, space and keeping up with anticipated box traffic was on top of the to do list. All of California’s major boxports share the common issue of being located within major metropolitan areas. Their limiting expansion opportunities challenge the ports to be good neighbors while being engines of regional growth. The size of the Californian economy impacts the entire US. As California goes, so goes the nation…at least economically. Recent US Department of Commerce figures suggest that the State is pulling out of the recession, albeit with a caveat. Commerce reports that California’s merchandise import trade totaled $30.35 billion in August 2010, a healthy increase of 26.6% over August 2009. The importance of these numbers extends beyond California’s borders as the State accounts for 17.8% of all US merchandise imports in August. According to the Department of Commerce, California’s nominal international trade deficit in August amounted to $18.47 billion. The caveat to economic recovery is export growth. It was expected that as the US recovered from the recession, exports would grow at a rapid clip. California shipped $11.89 billion in goods in August, topping the $10.03 billion August 2009 by 18.5%. But August’s trade tally was just a 0.2% sliver ahead of July’s, according to an analysis by Beacon Economics. Jock O’Connell, Beacon Economics’ International Trade Adviser opined, “August 2009 was a lousy month in an exceptionally dismal year for trade.” Adding, “So a nominally healthy year-over-year improvement isn’t all that comforting.” O’Connell was most disturbed by the fact that August’s export trade number was barely larger than July’s. “Over the past decade, California’s export trade each August has exceeded July by an average of 7.0%,” he explained. “In that context, the 0.2% rise from July to August this year is disconcertingly anemic. You have to go back to 2006 to find August exports at this year’s level,” he said. Counting boxes Nevertheless, there are some very positive signs coming out of California’s box ports. For example, in the Port of Los Angeles, September’s loaded inbound tally was 373,249 teus, up nearly 21%, compared to 309,078 in 2009. Overall, the total through September this year is 5,869,895 teus, an increase of 18.3% over the same period last year. In neighboring Port of Long Beach, through September, the port handled 4,568,260 teus, up 23.5% for the same period. In the Port of Oakland, the trend is the same. The Port through August has handled 1,517,864 teus, up 14.7% over the same period last year. In the period of May through August the Port of Oakland has averaged over 20% teu growth. Port of Oakland Executive Director Omar Benjamin noted, “Exports began to rebound last year and now we’re seeing some recovery on the import side of our business.” Oakland’s numbers are a little different from those of the dynamic duo in San Pedro. The Port of Oakland has one of the most balanced imports-to-exports ratio of all US ports. For