New York Metropolitan Transportation Council, New York Metropolitan Transportation Council, Brown Bag Seminar, April 16 2007Brown Bag Seminar, April 16 2007

Intermodal Transportation Intermodal Transportation and Commodity Chains: and Commodity Chains: New York and the Global, New York and the Global, Regional and Local NexusRegional and Local NexusJean-Paul RodrigueAssociate Professor, Dept. of Economics & Geography, Hofstra University, New York, USA

Email: ecojpr@hofstra.eduPaper available at:http://people.hofstra.edu/faculty/Jean-paul_Rodrigue

New York as a Nexus: Commodity Chains and Transportation

CommodityChains

Transportation

Global

Regional

Local

Production

Distribution

Consumption

Gateways

Corridors

Terminals

Integrated Transport Systems

UPS Willow Springs Distribution Center, ChicagoUPS Willow Springs Distribution Center, Chicago

The Global Nexus: Commodity Chains and Global Production Networks

Global Production NetworksGlobal Production NetworksContainer Ports as GatewaysContainer Ports as GatewaysIntegrated Transport SystemsIntegrated Transport Systems

Spaces, Networks and Flows in a Global Economy

■ Globalization; a clustered and spatially diffused process• In terms of production and

consumption.• Distribution is reconciling

spatially diverse demands for raw materials, parts and finished goods.

■ The backbone of globalization• Networks are established to

support distribution.• Nodes are regulating the flows

within networks.• As international trade increases,

nodes have become strategic locations.

Commodity Chains and Added Value

Commodity chain

Adde

d va

lue

Low

High

Manufacturing

R&D Globalization

DistributionDesign

Branding Marketing

Sales / Service

Concept Logistics

Disconnection of Global Production and Distribution

Manufacturing Base

Core BaseDistribution Marketing / RetailR&D

The Emergence of Global Production Networks

■ The Logistical Nexus• Fast growth of international trade

with the full realization of comparative advantages.

• Geographical and functional integration of production, distribution and consumption.

• Commodity / Supply Chains.• Transportation integrated in the

production / retailing process.• Global Production Networks

(GPN).• Logistical poles where value

added activities are performed.

• Entirely new nodal locations.

Com

mod

ity C

hain

Flows

Market

Transport Chain

Parts and rawmaterials

Manufacturingand assembly

Distribution

Market

Stage

Bulk shipping

Unit shipping

High volumesLow frequency

Low volumesHigh frequency

LTL shipping

Average volumesHigh frequency

Network

GPN

Traffic at the 50 Largest Container Ports, 2004

Dubai

Tacoma

Santos

Jeddah

Durban

Seattle

Salalah

Oakland

Colombo

Melbourne

Long Beach

Charleston

Nhava Sheva

Los Angeles

New York/New Jersey

Kobe

TokyoOsaka

BusanNingbo

Nagoya

Manila

Dalian

Yantian

Tianjin

Keelung

Yokohama

ShenzhenShanghai

Quingdao

Singapore

KaohsiungHong Kong

GuangzhouPort Kalang

Laem Chabang

Tanjung Priok

Tanjung Pelepas

LeHavre

Hamburg

Antwerp

Valencia

Rotterdam

Barcelona

Algeciras

Felixstowe

Gioia Tauro

Bremen/Bremerhafen

Pacific Asia Europe

Traffic 2004 (TEU)

Less than 2 million

2 to 4 million

4 to 7 million

7 to 10 million

More than 10 million

Integrated Transport Systems: From Fragmentation to Coordination

Factor Cause Consequence

Technology Containerization & IT Modal and intermodal innovations; Tracking shipments and managing fleets

Capital investments Returns on investments

Highs costs and long amortization; Improve utilization to lessen capital costs

Alliances and M & A Deregulation Easier contractual agreements; joint ownership

Commodity chains Globalization Coordination of transportation and production (integrated demand)

Networks Consolidation and interconnection

Multiplying effect

Major US Modal Gateways, 2004

Port of Miami

Port of Tacoma

Port of Seattle

Port of Houston

Port of Oakland

Port of Beaumont

Port of Portland

Port of New York

Port of Savannah

Port of Baltimore

Port of CharlestonPort of Long Beach

Port of New Orleans

Port of Morgan City

Port of Los Angeles

Port of Philadelphia

Port of Jacksonville

Port of Norfolk Harbor

Port of Corpus ChristiPort of Port Everglades

Port of Huron

Port of Blaine

Port of Laredo

Port of Hidalgo

Port of El Paso

Port of Pembina

Port of Detroit

Port of Nogales

Port of Sweetgrass

Port of Calexico-East

Port of Alexandria Bay

Port of Otay Mesa Station

Port of Brownsville-Cameron

Port of Champlain-Rouses Pt.

Port of Buffalo-Niagara Falls

Chicago

Atlanta

Cleveland

New Orleans

Dallas-Fort Worth

Boston Logan Airport

JFK International Airport

Seattle-Tacoma International

Miami International Airport,

Los Angeles International Airport

San Francisco International Airpor

Air Gateways

$68 Billion

Exports

Imports

Land Gateways

$64 Billion

Exports

Imports

Port Gateways

$81 Billion

Exports

Imports

The Three Main Gateways of North America

Gateway System

Gateways Total share (%)

Imports / Exports ($ billions) 2004

Southern California

Port of Los Angeles, Port of Long Beach, Los Angeles International Airport, Otay Mesa (Port of Entry)

18.3% $255.9 $77.8

New York / New Jersey

JFK International Airport, Port of New York / New Jersey

13.1% $163.0 $75.8

Detroit Detroit (Port of Entry), Huron (Port of Entry)

9.8% $97.9 $81.8

Translisft crane, NS Rutherford yard, PATranslisft crane, NS Rutherford yard, PA

The Regional Nexus: Freight Distribution, Gateways and Corridors

Intermodalism and TransmodalismIntermodalism and TransmodalismCorridorsCorridors

Intermodal and Transmodal Operations

RO

AD

RA

ILM

AR

ITIME

Inte

rmod

al T

erm

inal

Thruport

Ship-to-ship

DCs / CD

Intermodal Operations Transmodal Operations

On-dock rail

Transloading

Port container yard

Intermodal Transport Chain

Composition

Transfer

Interchange

DecompositionLocal / Regional Distribution

National / International Distribution

Transport Terminal

‘First mile’

‘Last mile’

Main North American Trade Corridors and Metropolitan Freight Centers

Miami

Boston

Dallas

Denver

Norfolk

Atlanta

Memphis

Halifax

Detroit

Toronto

Chicago

Houston

Phoenix

Seattle

Calgary

Edmonton

Winnipeg

Montreal

New York

Portland

Baltimore

Charlotte

Cleve land

St. Louis

San Diego

Vancouver

Charleston

Pittsburgh

Cincinnati

New Orleans

Kansas City

Minneapolis

Los Angeles

Philadelphia

Oklahoma Ci ty

San Francisco

Salt Lake City

Hub

Gateway

Level of Congestion of the Interstate Highway System

APL “Australia” entering San Francisco HarborAPL “Australia” entering San Francisco Harbor

The Local Nexus: Terminals

Terminalization of PortsTerminalization of PortsPort RegionalizationPort Regionalization

Commodity Chain

The Value Capture Process along Commodity Chains

Port Holding

Port

Aut

horit

y

Maritime Services

Inland Services

Port Services

Horizontal IntegrationVertical Integration

Maritime Shipping

Port Terminal Operations

Inland Modes and Terminals

Distribution Centers

Logistics: Soft Pressures on Hard Assets

Locational

Infrastructural

Transport

LogisticalShipper

Customer

Valo

riza

tion

Dem

and

Pu

ll

Port Holdings as Elements of the Maritime / Land Interface

Global Port Terminal Ownership, 2001

0 10 20 30 40 50

Global PortHoldings

Ocean Carriers

Port Authorities

Other Private

Share of global port container throughputShare of global terminal ownership

■ Horizontal integration using fixed assets• More than 40% of global

containerized traffic (2006).• Gain a foothold in a wide variety of

markets (strategic positioning).• Financial assets.• Managerial expertise.• Gateway access.• Leverage.• Traffic capture.• Global perspective.

Pacific Asia Europe

APM Terminals

Dubai Ports World

Hutchison Port Holdings

Port of Singapore Authority

Eurogate

Stevedoring Services of America

Dedicated Maritime Container TerminalsMajort Port Holdings, 2007

Dr. Jean-Paul Rodrigue, Dept. of Economics & Geography, Hofstra University

The Spatial Development of a Port System: Towards Regionalization

Phase 1: Scattered ports Phase 2: Penetration and hinterland capture

Phase 3: Interconnection & concentration Phase 4: Centralization

Phase 5: Decentralization and insertion of ‘offshore’ hub Phase 6: Regionalization

Load center Interior centre Regional load centre network

Freight corridor

LAND

SEA

Deepsea liner services

Shortsea/feeder services

Cargo Handled by the Port of New York, 1991-2006 (metric tons)

0

10

20

30

40

50

60

70

80

90

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Mill

ions Bulk Cargo Exports

General Cargo Exports

Bulk Cargo Imports

General Cargo Imports

Annual Traffic at Some NY / NJ Crossings, 2005 (millions of vehicles)

0 10 20 30 40 50 60

GWB

Lincoln Tunnel

Holland Tunnel

Staten Island bridges

Truck Freight Corridors

New Jersey

Long Island

New York

Brooklyn

Queens

State

n Island

Bronx

Manhatt

an

GWB

TNBWSB

TZB

VZB

TBBLT

HT

OCB

GTB BYB

Connecticut

JFK

LGA

EWR

About 70 million truck crossings per year

Major Crossing

23.2

2.0 1,000 of Trucks per Day (2000)

8.6

7.47.8

5.2

5.7

1.5 8.4

4.8

6.44.21.9

QMT

BBT

8.4

Rail Freight Corridors and Port Facilities

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0 5 10 15 20 252.5Miles

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4 0 42 Miles

45

Navigation Channel

Control Depth (feet)

Intermodal Terminal

Container Port (proposed)

Major Highway

Proposed rail tunnel

5030

3737

37

50

45

40

43

40

50

40

42

Ambrose Channel

Main Ship Channel

Raritan Bay Channel

Arthur Kill Channel

Arthur Kill Channel

Kill Van KullChannel

Newark BayChannel

Upper Bay Channel

Hudson River

East River

50

The Narrows

Bro

okly

n

Stat

en Is

land

New

Jer

sey

N

2

1

Howland Hook

Red Hook

South Brooklyn

3

1- Port Newark2- Port Elizabeth3- Global Marine

Albers Equal-Area Conic Projection

Intermodal Facilities and Navigation Channels of the Port of New York, 2007

Port Elizabeth

Howland Hook

Port Newark

Global Marine

Red Hook

0 2000 4000 6000 8000 10000

Daily Truck Movements (one way), 2001

The Regina Maersk Could Barely Make it but The Emma Maersk Cannot…