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Plastics Position Port of New Orleans for Growth

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Ethylene plant under construction (file image courtesy BASF)

By MarEx 2016-11-17 21:05:46

The Port of New Orleans is planning expansion projects for its container operations to handle growing volume – but not from imports. Its export handling of chemicals rose 15 percent in the first six months of this year, and it foresees significant growth in resins and PVC exports for years to come. 

“We continue to realize growth in our container market and expect that demand to surge in the coming years as about $75 billion could be invested in large-scale industrial development in Louisiana over the next decade,” said port president and CEO Gary LaGrange. 

The investments in petchem facilities will drive plastics exports, in a parallel development to the rising export volumes at Port of Houston. A low-cost, abundant supply of natural gas liquids in the Gulf Coast region make it highly attractive for the construction of ethylene cracking plants. In the Houston area alone, new greenfield developments will add nearly five million tons per year of polyethylene capacity over 2016 and 2017, according to Plastics News.

Nearer to Port of New Orleans, the Louisiana Ethylene Plant will bring 500,000 tons per year of ethylene online; in Baton Rouge, a Formosa Plastics facility will produce 1.2 million tons; Axiall's Louisiana Ethylene Cracker in Lake Charles will pump out one million tons; and Sasol's Lake Charles Cracker will produce 1.5 million tons. All are expected to come online in 2018. 

To handle the extra plastic, Port of New Orleans has opened a new intermodal terminal, added two new container cranes and is upgrading a container storage and marshalling yard. With the added investments, the port expects that it will have a handling capacity approaching one million TEU. 

In addition, the port has a grant from MARAD to boost a container-on-barge service running to and from Baton Rouge. Empty boxes from the Memphis market go to Baton Rouge, where they are needed for petchem exports. Once loaded, they are shipped down the river and lifted onto box ships at Port of New Orleans. 

The port's tenants have also been adding new capacity to handle chemicals and plastics – including a new liquid bulk packaging facility, a container packing operation specializing in plastics and a new tank truck depot. 

“All of these additions, combined with plans for expanding container storage capacity will position the Port to handle our anticipated growth in the short-term," Lagrange said.