The Port of Brownsville is utilizing record revenue years leading up to COVID-19 to deal with the pandemic’s challenges.
The port reported a record $25.4 million in annual revenue in fiscal year 2019. The figure tops the previous record from 2018 with continuous robust growth over the last six years. The port’s performance was recently recognized by Moody’s Investor Service, ranking the Port of Brownsville third among all U.S. ports for financial resiliency.
Eduardo Campirano, the port’s director and chief executive officer, said some industries have seen reductions relating to COVID while others are seeing increases. Bulk mineral, breakbulk and steel are among the products that have seen increases at the port this year.
“Maritime operations at the Port of Brownsville have continued uninterrupted during the pandemic,” Campirano said. “Preliminary numbers indicate we are on pace to set a record for tonnage in 2020.”
Volumes in tonnage saw an increase from January through August of this year, he said. A key factor to this indicator is that the Port of Brownsville moves more steel into Mexico than any other U.S. port. Just over three million short tons of steel moved from the port to Mexico in 2019.
The recent approval of the United States Mexico Canada Agreement will likely add to this activity and other commerce related to Mexico. The USMCA updated the existing NAFTA agreement and will bring improved efficiencies in moving cargo across the border, Campirano said. He pointed to recent moves in Mexico that will introduce market dynamics to the fuel market.
Those changes in Mexico are likely to bolster the Foreign Trade Zone at the port. Products tied to petroleum are essential industries at the FTZ. Nearly $9 billion worth of exports and imports moved through the port’s FTZ in 2019.
Revenue Picture Moves Projects Forward
The port’s overall financial health makes it possible to continue with its strategic plans even during the COVID-19 era.
“With operating revenue records in five of the last six years, it’s now more feasible for the port to make significant, large infrastructure investments even during trying economic times,” Campirano said.
The projects have been many at the port in recent times. Over the last five years, the port has completed the construction and rehabilitation of docks. It has also improved internal roads to improve delivery of products and cargo. There is also the expansion of outside storage. The port received two new mobile harbor cranes early this year to keep up with growing demand for on-dock lifting capacity as cargo volumes increase.
In 2021, construction will begin on deepening the Brownsville Ship Channel from 42 to 52 feet. It’s a long-sought goal that will dramatically boost the port’s capabilities.
Seeking A Big Prize
The port also continues to move forward in its pursuit of a huge goal – the LNG projects that would bring an investment of nearly $39 billion. The Federal Energy Regulatory Commission has approved proposals to make the LNG energy projects a reality at the port.
Final investment decisions are to be made by the key applicants for the project, which would bring a liquefied natural gas facility to the port and export product to global markets from Brownsville. The facility would include three plants at the port that would produce about 38 million tons of LNG per year. It would also result in 470 tanker shipments per year for export from Brownsville.
“Just like everything else, COVID-19 has slowed these projects down a bit,” Campirano said about the LNG project. “We continue to work closely with the companies as they work to achieve their FDI (final investment decisions) goal.
“Once FIDs are announced, and the projects formally break ground, the region will be poised for new and diverse job opportunities,” he said.