Wednesday, March 16 2016
NEW ORLEANS — When Chiquita Brands International executives accepted a 2014 Louisiana offer to return to New Orleans after a four-decade absence, the immediate yield was obvious.
Today, the fruit and produce company is shipping 1.5 billion bananas a year through the port and supporting approximately 300 new logistics jobs. Over the next decade, Louisiana will reap total new economic output of $373 million to $485 million from the project, according to estimates by LSU economists.
“We at Chiquita are thrilled to return to the Port of New Orleans as we implement a new shipping configuration,” said Mario Pacheco, a senior vice president overseeing global logistics for the company, at an event announcing the project. “We are particularly excited about the enhanced service levels to our Chiquita and Great White Fleet customers that will result from this change in our shipping operations and expanded vessel capacity.”
By leveraging the Napoleon Avenue Container Terminal at the Port of New Orleans, Chiquita Brands not only benefits from a major, multimodal gateway to the North American economy for its products: Chiquita also can capitalize on using its cargo fleet to ship refilled containers on return trips, replenishing goods needed by the company and its customers at ports of call in Central America and other locations.
By September 2015, aided by more than 60,000 annual Chiquita container shipments, the Port of New Orleans reached a record level of container cargo activity. For the 12-month period ending in September, the New Orleans port handled 537,285 twenty-foot-equivalent containers, known as TEUs.
That volume reflected a 13.6 percent increase over the year-ago period, with trade lane activity to Central America doubling. In addition to bananas and produce, shipments of paper and chemicals also pushed the port’s volume to new highs.
“It’s another milestone that comes on the heels of four record years in a row,” said President and CEO Gary LaGrange of the Port of New Orleans. “We anticipate continued growth in our container market, along with a robust break-bulk and project cargo market, as we recently set 14-year highs in tonnage moved over port docks.”
From the Gulf of Mexico, commercial fleets gain access in Louisiana to two-thirds of the interior U.S. states via the Mississippi River, the highest density of intrastate and interstate pipelines in the nation via the Calcasieu Ship Channel and the Gulf Intracoastal Waterway, multiple cross-country interstate highways, and all six Class I railroad systems in the U.S.
Little wonder that roughly half of the Top 10 U.S. ports by tonnage (five of the 11 busiest ports) are in Louisiana. In fact, the No. 1 port by tonnage in the entire Western Hemisphere is the Port of South Louisiana, with its busy industrial port district situated between Baton Rouge and New Orleans. To date, the Port of South Louisiana has attracted more than $23 billion in industrial projects, ranging from a $365 million crude oil storage expansion by NuStar Energy to a $750 million direct reduced iron manufacturing site by Nucor Steel Louisiana, a $1.85 billion methanol complex under construction by Yuhuang Chemical of China and a newly proposed $9.4 billion ethylene chemical complex by Formosa Petrochemical Corp. of Taiwan.
“Of all that took place in 2015, we are most pleased about the economic development boom that continues to bless the Port of South Louisiana and the River Region,” said Executive Director Paul Aucoin of the Port of South Louisiana. “The Mississippi River is our state’s greatest natural resource.”
The increasingly international flavor of the state’s economic growth is evident: Since 2008, more than $60 billion in foreign direct investment projects attracted to Louisiana rank the state No. 1 in the U.S., both on a per capita basis and overall, for FDI activity, according to fDi Markets.
Unique Louisiana assets continue to build the state’s industrial economy. Along the Calcasieu Ship Channel from Cameron Parish to the Port of Lake Charles, multiple liquefied natural gas terminals are under construction, including Cheniere Energy’s $20 billion LNG complex that can export and import super-cooled gas. Near Lake Charles, Sasol Ltd. is building a $9 billion ethane cracker facility that will contain a half-dozen chemical derivatives plants.
Across the state at the foot of the Mississippi River, Port Fourchon handles 1,200 freight trucks and 400 large supply vessels daily at one of the world’s premier energy ports. It serves as the land base for LOOP, the Louisiana Offshore Oil Port, and facilitates the transmission of 1.5 million barrels of crude oil daily. For perspective, if Port Fourchon were out of service for just three weeks, the U.S. economy would lose an estimated $11 billion in business sales, 65,000 jobs and $3 billion in household earnings.
Louisiana also boasts 16 inland ports on the Red, Ouachita, Atchafalaya and other rivers that facilitate commercial connections to the Mississippi River, the Gulf of Mexico and the world. On the Port of Caddo-Bossier, Benteler Steel/Tube has begun operating the first phase of a 1.4 million-square-foot, nearly $1 billion seamless steel tube and steel mill project that ranks among the most significant manufacturing projects in Northwest Louisiana history. In rural Northeast Louisiana, the State of Louisiana helped developed a river terminal to serve a new $100 million investment from Myriant Corp., which is operating a bio-based succinic acid manufacturing plant near the Port of Lake Providence.
In addition to cargo and industry, Louisiana ports serve other functions, such as the more than $400 million in annual cruise ship activity at the Port of New Orleans, where leaders set a goal of serving 1 million passengers years ago and exceeded it in 2014. That number will rise with new cruise ships from Carnival Cruise Line and American Cruise Line home-porting in New Orleans this year, and Viking River Cruises announcing the city as its homeport for trips on the Mississippi River later this decade.
All told, Louisiana’s 31 ports support 524,963 jobs and $182 billion in economic output, said LSU economist Jim Richardson, who completed a new economic impact study of Louisiana’s ports in March 2016.
With Don Pierson photo
One person well-acquainted with the power of Louisiana’s ports is Don Pierson. In January, Pierson began service as Louisiana Economic Development’s new secretary after his appointment by Gov. John Bel Edwards. With more than a decade of service at LED and 27 years in economic development, Pierson successfully led the recruitment of major Benteler Steel/Tube and Chiquita Brands International port-based projects to Louisiana. Those deals are among $75 billion in new capital investment and more than 105,000 jobs associated with LED projects wins while Pierson has served in senior LED management roles since 2005.
In his new leadership role, Pierson is emphasizing bedrock priorities – the collaboration of state, regional and local economic development partners on project-oriented solutions – while initiating targeted outreach in key global markets and redoubling Louisiana’s focus on small business success and continual workforce improvement. C
Visit http://www.expansionsolutionsmagazine.com/louisiana_ed for local economic development office directory listings.