Supply chains are already impacted by production and shipping delays caused often, by the global pandemic. At the same time, demand for e-commerce goods has skyrocketed. Especially through Port Houston. Social distancing means more people than ever before are ordering goods online. And in some sectors like health and wellness, suppliers have seen product demand increase.
That is just one reason why the demand for freight is continuing to increase. And why any kind of disruption to drayage and container vessels can be catastrophic. Not just for the port, or trucking companies, but for American consumers and businesses waiting for goods. We saw that on a global scale, when the Ever Given ship ran aground in the Suez Canal.
Closer to home in Port Houston, two shipping lanes were closed for hardware malfunctions. And that meant that the Port Authority had to work double time to make sure that Houston wouldn’t be a repeat of the problem at the Suez Canal. Port Houston remains America’s busiest port for container freight. And even the smallest disruption can cost businesses millions of dollars per day.
On Tuesday, July 27th, two of Houston’s busy freight terminals were closed. That meant no vessels incoming or outgoing through the terminals. Both the Bayport and the Barbours Cut Container terminals were affected.
What Caused the Hardware Malfunction at Bayport and Barbours Cut Terminals in Port Houston?
The first concern when a Port and terminals are impacted, is whether it is the work of cyber criminals or a cyber-attack. Increasingly global logistics are faced with new threats and sophisticated methods of piracy, that can result in the loss of containers.
On Tuesday July 27th, Port Houston Executive Director Roger Guenther wrote a letter to partners, businesses and major stake holders. He indicated that the malfunction was not related to a cyberattack on technology in the Port. Guenther instead referred to it as a “major failure of the storage devices.”
How Big Was the Problem in Port Houston After Shutting Down Two Terminals?
Because repairs were necessary, the two terminals stayed closed until Thursday morning. Many people were wondering if it was a malicious software attack, because the problem involved the support software at the terminals. But it was the hardware that malfunctioned. The devices that were responsible for operating both the Bayport and Barbours Cut terminals.
Normally the truck gates open at 7:00 a.m. That was when the first hardware and software failure happened. There was a data migration of software applications that were transferred to older storage devices to help fix the problem. But a few hours later the old storage systems were unable to process transactions and they failed.
With the catastrophe that lasted several days at the Suez Canal, Port Houston did not want to be responsible for another shipping disruption. Port Houston Executive Director Roger Guenther said that he would extend operation hours into the evenings and over the weekend to ensure that containers would not be backlogged at the port.
Speaking of high traffic canals, did you know that Port Houston and the Panama Canal Authority have a close friendship? It’s not surprising when you think of how much shared vessel freight the two ports manage.
Laurentino Cortizo Cohen is the President of the Republic of Panama. Cohen made an important visit to Port of Houston on July 14, 2021. The further expansion of Port of Houston impacts Panama’s vessel traffic and shared trade opportunities.
Port Houston Is Busy! Getting Things Moving Again Without Disrupting Gate Traffic
In 2020, Port of Houston Texas was ranked as the busiest waterway and shipping channel by tonnage, according to the U.S. Army Corps of Engineers. This despite all the supply chain disruptions caused by COVID-19. As well as the tremendous uptick in freight due to economic upturn, as consumer and business confidence has improved because of deployment of the COVID-19 vaccine.
The U.S. Census Bureau reported that Port Houston saw total world trade of $14.19 billion in May 2021 alone. Through June, 2021, Port Houston has reported 1,607,793 TEUs or a 13% increase in freight volume over the first six months of 2020.
“Unquestionably, the expansion of the Panama Canal has had a significant role in the growth of cargo volume and the number of larger ships and vessels calling our port,” Executive Director Roger Guenther remarked. “That’s why we must continue to make strides with the expansion of the Houston Ship Channel – Project 11 to ensure that we can accommodate the larger ships and vessels, which means more jobs and greater economic impact to our region.” – BusinessWire
The two terminals that were closed (Bayport and Barbours Cut) are high volume. Many local Houston trucking companies do as much as 80% of their pickups at those terminals. Particularly carriers with warehousing and crossdocking in nearby LaPorte, Texas.
Bayport Terminal Is Being Expanded in 2021
The U.S. Secretary of Transportation, Elaine Chao announced on March 10, 2020, that Port Houston was receiving a large grant for improvements. In total, Port Houston Texas will receive $21.8 million dollars as part of a new Port Infrastructure Development Program. The goal is to increase efficiency at some of America’s busiest freight hubs.
Part of the funding received by Port Houston will go into improving the Bayport Container Terminal. There will be a new crane rail for existing cranes to attach to. This will expand operational capacity on the wharf. After the improvement to Bayport Terminal, the new capacity will allow an additional 2.4 million TEUs to be to pass through the busy terminal.
Th opening and widening of the Port Houston Shipping channel is expected to drastically increase freight capabilities. And much larger container ships, as they keep getting bigger and bigger. Local private industry businesses have also pledged to donate up to 50% of the $1 billion cost of the channel expansion project.
The investment in Port of Houston is overdue and warranted. Mr. Ric Campo, the Chairman of the Port Authority went presented to the U.S. House of Representatives in February 2021, to ask for funds for the port expansion project. According to Campo, Port Houston is wroth $800+ billion in economic value every year. And the shipping canal in Houston provides for 3 million jobs.