News Content

Shippers, transport providers brace for long Harvey recovery

FREIGHT transportation in and around Houston remains at a standstill as companies check on staff, assess damages, and prepare for a difficult recovery and higher truck rates after historic flooding unleashed by Hurricane Harvey.

Port terminals, major highways, rail lines, airports, industries, trucking docks and warehouses remain closed, along with most regular business activity in the fourth-largest US city. Cargo remains stuck in warehouses, at port terminals, and on inbound ships.

Port Houston is taking a day-by-day approach to reopening its terminals, which closed before Harvey hit land near Corpus Christi. The US Coast Guard has halted ship traffic at Houston, Galveston, Freeport, and Corpus Christi until port channels and navigation aids can be checked.

The logistics industry is looking ahead to a likely spike in trucking rates after high water recedes from streets and neighbourhoods. "Look for spot prices to jump over the next several weeks, with very strong effects in Texas and the South Central region," said Noel Perry, partner at freight analyst firm FTR. "Spot pricing was already up strong, in double-digit territory. Market participants could easily add 5 percentage points to those numbers."

Recovery could be slowed by the sheer scope and extent of the storm. Many employees at logistics companies, terminals, and other supply chain work lost homes and vehicles in the flooding.

Container lines serving the port have avoided diverting cargo to other ports. Maersk said it hoped to work two ships, the Maersk Ohio on its TA1 service and the Maersk Denver on its MECU service, at Houston if labour was available.

The Port of Corpus Christi, which didn't flood when the storm hit land with 130 mph winds, said its terminals had light to moderate damage. The port said it was working to restore power to all facilities and hopes to return to normal operations September 4.

The Coast Guard said set conditions limiting vessel operations at the ports of Beaumont, Port Arthur, Orange, and Lake Charles, which are east of Houston and are in the path of the storm's latest path.

BNSF and Kansas City Southern railways and Union Pacific Railroad suspended operations in the Houston area and embargoed traffic at the hurricane approached, and said customers should expect delays.

Trucking companies also suspended operations in the region, with the pain inflicted by the storm reaching far inland. Terminal operations as far away as Laredo, Dallas and Fort Worth were affected by the diversion of freight or the inability to move freight on to its final destination closer to the Gulf, according to IHS Media.