Trade opportunity seen between Cuba and Port of New Orleans

Significant potential exists for trade between Cuba’s Port of Mariel and the Port of New Orleans, but U.S. trade policy and Cuban economic hurdles stand in the way, according to opening addresses today at the Cargo Connections Conference in New Orleans. Charles Baker, president and CEO of the Port of Mariel, said he perceives the three-year-old container facility on the northwest coast of Cuba, 26 miles west of the capital city of Havana, as the “new transport hub for the Americas” in “a very, very good location for a transshipment hub.” However, he cited the current U.S. embargo requirement that, in most cases, ships must wait 180 days after leaving a Cuban port before calling at a U.S. port as a major impediment. Baker said he believes there is light at the end of the proverbial tunnel as far as removal of U.S. trade policy hurdles under the Trump administration, adding, “We’re just not sure how far the end of the tunnel is. “I think trade between the two countries is going to stimulate the kind of growth Trump is seeking,” Baker said. Baker also cited the sorry state of the Cuban economy. “We saw the economy struggle, and we continue to see it struggle,” he said, referencing the low per-capita income of the island nation. “It doesn’t look good right now.” The average monthly salary of the 510 Cubans currently employed at the Port of Mariel is US$500, he said. Nonetheless, container volume at the Port of Mariel grew from about 160,000 twenty-foot-equivalent units in 2014, its first year of operation following end of container traffic at the depth-challenged Port of Havana, to 330,713 TEUs in 2015 before leveling off to 325,319 TEUs last year. The Mariel port’s current annual throughput capacity is 800,000 TEUs, with future expansion to boost that number to 3 million. Baker said Cubans “need everything” in terms of goods, while export opportunities exist for artisan charcoal (some of which was shipped to South Florida’s Port Everglades earlier this year), pharmaceuticals, frozen seafood, honey, Cuban coffee, tobacco and rum. Still, 90 percent of container capacity departing Cuba leaves empty, he noted. Regarding the 180-day rule, Baker said, “We would really, really like to have our Achilles’ heel removed by Washington.” In a presentation focused on the capabilities of the Port of New Orleans, Brandy Christian, who became that port’s president and CEO in January, called New Orleans and Mariel “two ports that have been linked by history and hopefully more in the future.”

Christian said petrochemical resins are helping spur a boost in New Orleans container volumes, which she projected will reach 550,000 TEUs this year after topping the 500,000-TEU mark in 2016. She cited the on-dock intermodal rail facility opened a year ago at the Port of New Orleans’ primary container terminal, as well as the fact that the port is served by six Class I railroads in addition to extensive barge links and trucks, with the latter mode eased by recent gate automation and appointment system implementation. Christian pointed to smooth, efficient service offered by the Port of New Orleans, saying, “They call us the Big Easy, and that’s what we hear from our shippers: It’s just easy to do business in New Orleans.” Comprehensive coverage of the conference, sponsored by the Port of New Orleans, is scheduled to appear in the April 24 edition of the American Journal of Transportation.