Miami eyes Top 10 import-export ranking as state prepares logistics plan
The Miami Customs district is poised to finish among the nation’s 10 busiest for the first time in 2012, moving up from the No. 14 spot in the past few years on the strength of its exports to Latin America.
And 2013 should bring continued growth in South Florida trade, as Latin America is forecast to post solid economic gains yet again, panelists said at the Dec. 12 meeting of WorldCity’s Trade Connections.
For the first 10 months of 2012, South Florida’s trade with the world exceeded $105 billion, up by 10 percent from a year ago. That growth pushed Miami past San Francisco as the country’s No. 10 Customs district by value of goods sent in from and out to foreign countries. Brazil, Colombia and Switzerland remained Miami’s top three trade partners, with goods trade up more than $1 billion with each over the period, according to U.S. Census Bureau data analyzed by WorldCity.
“Miami has become the biggest export-import center for gold. A lot of it comes in from Colombia and Mexico and now some from Bolivia. It goes to Switzerland and, to a lesser but growing extent, the United Arab Emirates,” serving as a financial hedge for many investors in today’s uncertain times, said WorldCity President Ken Roberts.
For 2013, panelists see trade opportunities spurred partly by the ongoing expansion of the Panama Canal, which is expected to bring mega-ships and more cargo to the U.S. Atlantic Coast.
Florida is working on developing its first ever freight plan by July 2013, said Richard Biter, a Florida Department of Transportation assistant secretary with three decades experience in transport in the private and public sectors, including director of inter-modalism at the U.S. Department of Transportation.
Florida’s freight plan will involve three main areas, Biter said. First, it will tell the “freight story,” so that more in the public will recognize that moving cargo creates jobs and fuels the economy.
“Seeing trucks on the road is not a bad thing. It’s actually a good thing,” Biter said to the audience of more than 60 people involved in the freight business.
Next, the plan will institutionalize freight planning at the Florida Department of Transportation, so cargo will automatically be considered in planning roads, intersections and other transport needs. Specific efforts also will be made to plan “freight corridors” to carry goods to key areas in the state and beyond.
Finally, the department will work with ports and others to market and sell Florida’s transport infrastructure as a base for trade, distribution and related business, Biter told the group.
Many participants applauded the transport plan. They lamented that freight long had been undervalued in planning in a state soon to become No. 3 in population nationwide, surpassing New York.
“I think these are fantastic steps in the right direction. We need visionary people,” said Jeff Leopold, vice president of development at Florida Cargo Fresh Inc.
Still, there are challenges ahead for South Florida trade in 2013, participants cautioned.
While business with Latin America is strong and expanding, profit margins are compressed in a world economy growing slowly, said Dan Fisher, director for North America in the global trade finance division of TD Bank, the U.S. arm of Canada’s Toronto Dominion bank. There’s also a lag in selling or renting older warehouses and commercial space in South Florida, although newer, taller Class A space is moving more quickly, said Aaron Ahlburn, senior vice president for the Americas at real estate firm Jones Lang LaSalle.
And while the Panama Canal expansion will certainly bring more cargo to the U.S. East Coast, it remains unclear which seaports will be selected to handle the mega-ships and then, transport their goods inland to other cities and states, participants agreed. Decisions hinge partly on inland logistics systems.
“A lot of companies are waiting to see how [transport] plans play out,” before opting to invest in new warehouses and commercial buildings in Miami, Savannah or other port areas, said Ahlburn.
Other key issues raised during the morning session:
Near-shoring: Higher fuel and transport costs and rising wages in China are making manufacturers look closer to U.S. shores to produce goods for the Americas market, said Leo Moreira, American Airlines Cargo director of cargo sales and marketing for the U.S. southeast region. Mexico is becoming more competitive for manufacturing, recently attracting an Audi factory, said Ahlburn.
Incentives: Other states are offering more generous incentives for companies to develop freight warehouses, said Eric Olafson, PortMiami’s manager for cargo development. But the state doesn’t want investment in “Built it and they will come” facilities that may sit vacant, said Florida’s Biter.
“We want serious business plans,” Biter told the group.
Trade Connections is one of five events series organized by WorldCity to bring together executives on international business topics. The series is sponsored by PortMiami, Banesco, Miami International Airport, American Airlines Cargo, South Florida Logistics Center and Seaboard Marine. The next Trade Connections is set for Feb. 15.