GLOBAL CITIES INITIATIVE
BROOKINGS METROPOLITAN POLICY PROGRAM
The United States traded over $4 trillion worth of international goods in 2014, ranging from raw agriculture to advanced precision instruments. The enormous variety of exports and imports powers American industries, allowing industrial and household consumers to enjoy cost-effective products and exporting producers to access global markets. Even with a transition to a more service-based economy, goods trade still represents a vital component of economic growth.
America’s international ports—the water, air, and surface transportation facilities that handle global goods—are either the first or last place a good touches domestic soil, and therefore they are vital components in trade networks. With towers of containers sitting on docksides, flocks of cargo planes parked at airports, and lines of trucks on both sides of the borders, ports are often the clearest visual evidence of all the goods trade taking place across the country.
While ports are a vital conduit between the international marketplace and domestic producers and consumers, there is an information gap when it comes to ports’ specific role in the country’s trade networks. As a consequence, public policy tends to treat ports as infrastructure facilities that serve only their surrounding place, rather than as shared assets upon which dozens of metro areas across the country rely. This approach fails to take a holistic view of trade infrastructure and limits the coordination of fixed investments and commercial trade policies. To address this deficiency, this report analyzes international goods trade at ports of entry, whether land, air, or sea; it uses data from 2010, the latest year available. The analysis finds that:
- Ocean vessels and airplanes move over 70 percent of all internationally traded goods into and out of the U.S., a share consistent with transportation’s modal trends over the past two decades. Trucks, railroads, and pipelines account for the rest. There is a greater degree of modal variety by the commodity traded, with lower-value, higher-weight goods like energy products and agriculture more likely to move by ship and higher-value, lower-weight goods like electronics and precision instruments more likely to move by airplane.
- The country relies on 25 port complexes—a group of ports within one place—to move 85 percent of all internationally traded goods. The majority of these port complexes are in large metropolitan areas, ranging from the seaports and airports in Los Angeles, New York, and Houston to single major ports in metro areas like Anchorage, Alaska; Buffalo, N.Y.; and Savannah, Ga. The ports also tend to specialize in moving specific commodities, which affects their average value and determines common trading partners.
- All port complexes primarily serve customers in other parts of the country, with only 4 percent of their goods either starting or ending in their local market. Due to commodity specialties and common trading partners, even local economies tend to use other ports more than their local ports. This creates a spatial mismatch between where international transactions occur and the domestic source of that trade.
- The average international good travels over 1,000 miles within the U.S. to get from a port to its market, underscoring how international trade relies on the domestic freight network. This includes extensive travel from West Coast ports, but also lengthy average trips for goods starting or ending at East Coast, Gulf Coast, and NAFTA (North American Free Trade Agreement) ports.
This paper uncovers an intense spatial mismatch in the country’s international flow of goods: A small group of port complexes handles the vast majority of all trade flows, but those ports primarily serve domestic markets besides their own. In response, federal policies must do a better job recognizing the outsized role of the busiest ports and the benefits the entire country receives from efficient connections to those key assets. Likewise, local leaders must reconsider their ports’ role within the local economy and possibilities for logistics growth.
Background The United States has long been one of the world’s preeminent traders, currently ranking second to China in the exchange of physical goods. In 2014 alone, the United States exported and imported $4.0 trillion in goods—exceeding the combined trade of Japan, France, and the United Kingdom.
These high levels of international trade benefit the U.S. economy in several ways. Exporting firms not only pay higher wages, but they also play an outsized role in the ongoing economic recovery. Similarly, by importing foreign products, American producers and consumers can enjoy lower costs for many goods, and producers can inject additional value into domestic supply chains.4 Ultimately, exports and imports help regions across the U.S. create, manage, and participate in the global value chains that define modern production practices. For example, while many computer products are now assembled in Asia and imported to the U.S., high-value design, manufacturing, and management still takes place in metro areas like San Jose, Calif.; Portland, Ore.; and Austin, Texas.
Maximizing these economic benefits, though, requires an efficient and reliable freight infrastructure network. Various infrastructure facilities, including roads, railroads, and ports, represent the primary physical conduits between the domestic economy and the international marketplace. At the same time, transportation itself has a significant impact on the costs of traded goods. The marginal cost to move goods internationally can determine whether firms conduct trade at all. That means high-functioning infrastructure is more than just a luxury—it’s a requirement to maintain competitive exports and lowcost imports.
Among these infrastructure assets, the nation’s ports—the physical sites of foreign exchange—act as perhaps the most critical links tying together regional and international economies. From major cargo airports in New York and Miami, to seaports in Los Angeles and Savannah, to land border crossings in Laredo, Texas and Detroit, the United States boasts over 400 unique freight-handling ports (see Map 1). These ports are also tremendously busy, with over 30 million separate trade entries per year on imports alone. In addition to covering almost every corner of the country, these ports have unique characteristics when it comes to their global connections, commodities, and even the types of containers and products handled. The Port of Seattle, for instance, focuses on shipping standardized containers between East Asian markets, while Miami International Airport specializes in Latin American produce and flowers.
About the Global Cities Initiative
Launched in Los Angeles in March 2012, the Global Cities Initiative is a $10 million, five-year project of Brookings and JPMorgan Chase aimed at helping the leaders of metropolitan America strengthen their regional economies by becoming more competitive in the global marketplace.
About the Brookings Metropolitan Policy Program
The Metropolitan Policy Program at Brookings is redefining the challenges facing metropolitan America and identifying assets and promoting innovative solutions to help communities grow in more productive, inclusive, and sustainable ways.