Growing Houston port draws in intermodal, cold chain investments

Source: The Loadstar
Date: 22nd May 2023

The port of Houston, which was one of the fastest-growing US container gateways last year, continues to draw in new investment. Class I railway BNSF is readying the launch of intermodal services to the Dallas/Fort Worth area and Denver next month, while a developer of cold storage facilities is planning a $102m building with direct rail access to the port’s docks.

After a year of gauging demand for rail services between the port and the interior, BNSF is set to start a regular service from Houston’s Barbours Cut container terminal to these inland markets on 2 June. This follows upgrades at the railway’s intermodal facility in Dallas.

Trains will run twice a week to Dallas and weekly to Denver. BNSF management indicated that it may increase service in the sectors, based on demand.

The carrier has reportedly been in negotiations with several container ship lines to make them offer international customers intermodal service to these inland points. So far there have not been any announcements from ocean carriers along these lines.

Houston has not had regular intermodal service since 2019, but its rise in container traffic prompted BNSF to develop such an offering. The port’s box volumes surged over the past year as beneficial cargo owners diverted traffic from the US west coast ports to the East and Gulf coasts. Its container throughput jumped 14% last year to nearly twice the volume registered in 2016.

Houston’s box imports were up 9% in April from 12 months earlier. For the first four months of the year, the port reported 17% growth in loaded export volume.

The growth in traffic is also drawing in funds for cold chain capacity. A cold storage operator has formed a venture with BG Capital to build a 282,000 sq ft temperature-controlled warehouse in Baytown, 27 miles from Houston and 14 miles from the port. The new facility will have direct rail access to the port.

The pair intends to build about $ 1bn worth of cold storage facilities in ‘port-centric’ markets across the US.

The Houston facility, which has a $102m price tag, is their venture’s first project, scheduled for completion by mid-2024.

The rapid growth of traffic stretched the port’s capacity last year. By late September, with volumes up 26% year on year, it ranked as one of the most congested US container gateways.

The port authority is bent on boosting capacity.

“As the fastest growing and now the fifth-largest container port in the US, we must remain proactive and well-equipped to meet the needs of our customers,” commented the port’s executive director. “Infrastructure investments remain a priority at Port Houston, along with the expansion of the Houston Ship Channel, which is already improving vessel transit times.”

Not everybody is thrilled by the rapid expansion of the port’s traffic. One reliable source remarked ruefully that much of the space at the port has been taken up by containers. Houston is the largest US gateway for outsize project cargo entering the US.

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