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Jon Talton

Analysis and commentary on economic news, trends and issues, with an emphasis on Seattle and the Northwest.

Category: Ports of Seattle and Tacoma
June 18, 2014 at 10:37 AM

Where are the ports headed?

By my count (and I may be off), Port of Seattle and Port of Tacoma commissioners have held three confidential meetings since they received federal permission to share information. I’d love to be a fly on the wall. We know what won’t happen, a consolidation — Tacoma and Pierce County would never allow it. Here are  few…

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May 1, 2014 at 2:36 PM

Tacoma OKs major methanol export operation

Port of Tacoma commissioners today approved a lease for a $1.8 billion plant that would convert natural gas to methanol for export to Asia. Northwest Innovation Works, a joint venture that includes Chinese companies, proposes building it on the site of the former Kaiser Aluminum site. After permitting and environmental and other studies, the plant is…

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April 15, 2014 at 11:07 AM

The box that changed everything for shipping

Port of Seattle commissioners and other maritime officials on Wednesday will mark the 50th anniversary of the port’s first container terminal. It was leased to Sea-Land Service and Seattle became one of the first ports to have a dedicated container facility. This is the way the world’s 10,000-mile supply chain works now, as grippingly explained by…

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November 22, 2013 at 10:33 AM

Maritime, jobs, Eastside outlook and more

I was on the road (in the air, actually) for part of the week, so I need to play some catch up:

• My colleague Coral Garnick reported on the Pacific Marine Expo, including a new report showing that the maritime sectors have a $30 billion economic impact on Washington state. Like aerospace, software and biotech/biomedicine, this is a critical cluster.

Among its components: Passenger water transportation; boat and ship building, repair, and maintenance; maritime logistics and shipping; fishing and seafood products; and maritime support services. It is also a source of well-paying, blue-collar jobs.

It faces formidable risks. Climate change and overfishing threaten the ocean and its bounty. Members of Congress keep trying to weaken the Jones Act, which ensures some ship-building is done in America.

Closer to home, policymakers are not acting to ensure that infrastructure is maintained and built to ensure the viability of these sectors. Toxic competition between the ports of Seattle and Tacoma is not growing overall market share. Let’s not that this cluster for granted.

• Unemployment in metro Seattle and Washington ticked up last month. These reports always contain what economists call “noise,” so one month’s numbers should be approached with caution. Still, as my colleague Amy Martinez wrote, “October’s spike in joblessness, which continues a trend begun in August, suggests hiring has cooled considerably from spring and early summer.”

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Comments | More in Ports of Seattle and Tacoma | Topics: Bellevue Chamber, Eastside economy, Maritime

October 1, 2013 at 10:19 AM

Northwest ports losing market share

Amid continuing tepid growth in world trade in the Great Recession’s aftermath, the EU crisis and a slowdown in China, the Pacific Northwest saw an overall decline in its market share in the second quarter. A Journal of Commerce report said overall container traffic to North American West Coast ports fell by 2.3 percent compared with the same period in 2012 and overall market share also declined. But the pain was not uniformly felt.

In Los Angeles, container volume fell 9.9. percent, but this was offset by Long Beach’s 10.1 percent growth. This helped keep Southern California dominant in its share, up four tenths of a percentage point to 60.1 percent. Oakland was off 0.2 percent but its share grew slightly to 9.8 percent among the West Coast ports.

The story was different in the Northwest. The Port of Tacoma saw its container volume leap 34.3 percent, the best showing among the group surveyed. Unfortunately, most of this came as a result of the Grand Alliance and Hamburg Sud lines moving from the Port of Seattle, where traffic plummeted 28.8 percent, the biggest loss seen that quarter. Portland dropped 13.8 percent. Thus, the Northwest overall fell to 11.7 percent market share from 12.1 percent in the second quarter of 2012 and 12.4 percent in 2011. Share in Vancouver and Prince Rupert grew to 13.8 percent vs. 13.4 percent in 2012 and 12.6 percent in 2011.

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July 17, 2013 at 1:14 PM

Cruise industry brings big footprint ashore here

A new report from the Cruise Lines International Association says that the state posted a record $764 million in direct spending and cruise-industry employment of 19,000 last year. That ranked Washington sixth among the states in cruise industry economic impact. Seattle was the eighth-largest cruise port in the United States with 464,000 passengers embarking,…

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Comments | More in Ports of Seattle and Tacoma | Topics: Cruise industry, Port of Seattle, Seattle economy

June 10, 2013 at 10:42 AM

Seattle’s tight focus on trade

A Cosco container ship enters Elliott Bay. Cosco is the national flag carrier of China, the world's largest trading nation. (Photo by Ken Lambert / The Seattle Times)

A Cosco container ship enters Elliott Bay. Cosco is the national flag carrier of China, the world’s largest trading nation. (Photo by Ken Lambert / The Seattle Times)

The Trade Development Alliance of Greater Seattle held its annual dinner last Thursday. Gov. Jay Inslee was the keynote speaker. I was on a panel with Len Jordan of Madrona Venture Group and Jeff Frazier of Microsoft, moderated by Bill McSherry of Boeing. Major sponsors were Boeing, Microsoft and Highline Community College. Among those buying tables were the Port of Tacoma, the Port of Seattle, the Port of Everett, Seattle Metropolitan Chamber of Commerce and Washington State Department of Commerce. In addition to public officials and business people, attendees included consular officials of other countries.

It was an evening that attested to the power of trade here, and to this community’s interest in the wider world. Both are big advantages. Gov. Inslee promised the state would do what it could to win the 777X, said Washington would “feast at the table of technology” and touted the increase in cherry exports under the new Korean-U.S. trade agreement as well as the 100,000th Chrysler exported from the Port of Gray’s Harbor. Our panel was put through the paces in predicting such things as China’s growth and Middle East air traffic in 2013. I’ve worked in cities and states that only gazed at their navels, measured economic success in the number of new tract houses built. This is far better.

On the other hand, we live in our own bubble. Washington is a net winner from the trade status quo. The same is not true everywhere. For example, a year after the free-trade agreement with South Korea was signed, the U.S. trade deficit was larger and the promised increase in American jobs hasn’t happened.  South Korea is a currency manipulator, too.

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Comments | More in Aerospace/Boeing, Agriculture, Microsoft, Ports of Seattle and Tacoma, South Korea, Trade

June 6, 2013 at 10:28 AM

Finding the many vital rail links to the Puget Sound

I find evidence of the Puget Sound economy’s long reach all over, including in the June issue of Trains magazine. An article highlights the 25-year survival of Montana Rail Link, with a 623-mile main line running from Sand Point, Idaho, to east of Billings, Mont. This is the former Northern Pacific, the first transcontinental to reach our region. But it became redundant with the 1970 merger involving the NP and the Great Northern and creating the forerunner to today’s Burlington Northern Santa Fe. BN did a lease-purchase agreement with MRL founder Dennis Washington in 1987; in 2047, MRL has the option to purchase the main line outright. BNSF uses the former Great Northern as its main rail route, although it sends trains over MRL, too. And MRL has been successful in keeping and growing its own traffic.

One big blow came during the recession when Seattle’s Plum Creek Timber sawmill in Pablo, Mont., was permanently shut down. As a result, MRL was forced to close an entire branch line. “Losing Plum Creek was like losing Sears and JCPenney out of a mall,” the article quotes MRL President Thomas Walsh. The company was hammered by the housing collapse. It had also become a real estate investment trust, a boon to investors who get most of the profits, but a situation that doesn’t allow executives to be patient.

Meanwhile, the magazine — and you have to buy it, this isn’t available on the “tubes” (what a concept) — has a fascinating map showing all the trains operating on Montana Rail Link at 10 a.m. on Feb. 25. Again, the Puget Sound is heavily represented.

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June 4, 2013 at 10:24 AM

Airport, cruise ships are high points for Port of Seattle

Seattle-Tacoma International Airport (Ellen M. Banner, The Seattle Times)

Seattle-Tacoma International Airport (Ellen M. Banner, The Seattle Times)

In its new annual report, Port of Seattle CEO Tay Yoshitani called 2012 “another growth year and …we’re well positioned for 2013.” With 33 million passengers, Seattle-Tacoma International Airport achieved a record. International travel grew by 8 percent. Operating revenue rose to nearly $522 million in 2012, compared with $483 million the previous year. Of $224.6 million in capital spending, 82 percent went to aviation. Yoshitani said finances “were solid in 2012.”

The Midwest drought hammered grain exports, which fell 37 percent to 3.2 million metric tons. The biggest blow to the seaport in years came last year with the loss of the Grand Alliance and Hamburg Sud container lines, which went to the Port of Tacoma. The consequences won’t likely be tallied until next year’s report. Container volume fell 30 percent in March compared with the same month in 2011. The port did see Hanjin extend its lease at Terminal 46 through 2025. The United Arab Shipping Co. is expected to begin calling at Seattle this month in partnership with existing China Shipping service.

The cruise business continued to be a success for the port, with 202 vessel calls and a record 935,000 revenue passengers last year. The port claims that each homeport ship that calls brings $2 million to the local economy.

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