Aviation Traffic Drives Growth for Port of Portland

The Port of Portland is contemplating adding gates at Portland International Airport for the first time in 20 years, signaling how increased airplane traffic is the main source of growth for the airport operator.

Bill Wyatt, executive director of the Port of Portland, said the airport is running out of parking space because of increased traffic. Passenger numbers were up 10% in March compared with the same time last year, according to Port of Portland statistics. Freight traffic was up 8% over the same time period.

Wyatt spoke at a breakfast meeting Tuesday on shifting trends in the state’s traded sector. The event is part of a series of topic-led breakfast seminars hosted by Oregon Business magazine.

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The increase in aviation traffic contrasts with the decline of Port of Portland’s marine traffic. The number of containers at the port’s marine terminals fell 94.4% between March 2015 and March 2016. The port’s marine business has been struck by the loss of two major shipping lines – Hanjin Shipping Co. and Hapag Lloyd – which left the port last year after a labor dispute between container-terminal operator ICTSI Oregon and the longshore workers union.

But the decline in marine business for the port also signals a shift in the local economy, which derives most of its growth from high-tech goods, such as electronics, which are moved by air.

“We think of trade as the exchange of physical stuff; but growth is in very high-value goods and services and the ability to export knowledge,” said Joe Cortright, economist and president of Impresa Consulting. He cited the example of sportswear apparel company Nike, which manufactures most of its products in Asia, moving very few goods through Portland.

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Panelists Blake Rowe, CEO of Oregon Wheat, and Chris Sarles, CEO of Oregon Fruit Products, spoke of how important the Trans-Pacific partnership is to breaking down tariffs and streamlining trade agreements. Both Rowe and Sarles said the agreement would remove barriers to Asian markets, such as Vietnam and Malaysia. “They are hugely important to us in terms of free markets,” said Rowe.

But the partnership has its shortcomings, said Cortright. He pointed to onerous rules that would extend the duration of copyrights and patents in certain industries, such as the biopharmaceutical and entertainment sectors, which he said creates monopolies and stifles innovation.

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Kim Moore

Kim Moore is the research editor for Oregon Business magazine.

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1 comment

  • Kenny Macdonald
    Kenny Macdonald Tuesday, 03 May 2016 17:32 Comment Link

    Thanks for a great event last week. We really enjoyed being part of the panel.

    For those interested in learning more about non-containerized cargo that moves through the Port, which makes up about 85% of our total business at our terminals by volume, go to our marine business page: (http://www2.portofportland.com/Marine/Terminal5).

    The Port of Portland, Portland Harbor and the Columbia River as a whole, represent the largest wheat gateway in the world. We are also one of the largest mineral bulk exporters on the west coast. Both of these commodities move in bulk ships, not in containers. As our fellow-panelist, Blake Rowe, pointed out, rural economies depend on agricultural commodities like wheat that aren’t shipped in containers. These businesses, tied to the global marketplace, require low-cost freight to remain profitable.

    Another non-containerized commodity: autos. Import and export autos are the highest value product that go through the Port and bring with them tremendously positive economic impact. We anticipate increases for auto imports of Honda, Hyundai and Toyota in addition to Ford exports in the coming years.

    After the withdrawal of Hanjin and Hapag-Lloyd, many of the state’s containerized cargoes are finding alternate routes through congested marine terminals in the Puget Sound and the Bay Area either by truck or train, but often with increased price for shippers. While affordable and reliable container service continues to be a challenge for regional businesses, we remain committed to finding workable local solutions.

    Again, thanks for a great conversation about the importance of freight to our economy.

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