Neighbor Island Cargo Volumes Up Slightly

Makaala with tug. Courtesy of Young Brothers.

By Sonia Isotov

Young Brothers, Limited saw a slight increase in its intrastate cargo shipments between Honolulu and six neighbor island ports, according to the Young Brothers Quarterly Shipping Report for first quarter of 2012.

For the January to March 2012 period, intrastate volumes overall were up 2.6% compared to the year-ago quarter.

“The first quarter volume gain is modest, so it is still a little early to tell whether neighbor island economies collectively have begun to climb out of the bottom of the recession,” said Glenn Hong, president of Young Brothers, in a written statement.

“Although residents and businesses in Hawaii continue to manage through a difficult economic environment, given what’s transpired in the past few years, it’s encouraging to see even a modest increase in neighbor island economic activity and the associated intrastate cargo volumes. Of course, intrastate cargo volume is only one barometer of neighbor island economies.”

Hong said overall cargo volume started the quarter strong in January with favorable comparisons to a weak January-2011 period. However, the February comparison was not as strong and by March volume had shifted to a negative comparison.

Makaala close up. Courtesy of Young Brothers.

Cargo volumes to and from three neighbor island port facilities (Kahului, Maui and Hilo and Kawaihae on the Big Island) were encouraging, according to Roy Catalani, the vice president of strategic planning and government affairs for Young Brothers.

Kahului saw an increase of 6.3%% during the first quarter of the year, followed by Hilo (up 4.3%) and Kawaihae (up 2.4%).

Catalani said that Kahului’s increase appears to be largely driven by “inbound” cargo – or cargo headed to Kahului – which jumped 7.6% from the prior year, in contrast to a 1.4% increase in “outbound” cargo.

Similarly, Hilo’s increase is marked by a 5.8% increase in inbound cargo and a 0.1% increase in outbound cargo. In contrast, he noted that Kawaihae’s increased volumes were largely a result of its outbound cargo volume increasing 4% this quarter, while its inbound cargo was up a more modest 1.9%

Kaunakakai, Molokai showed the largest decline in cargo volumes (down 9.5% from the first quarter of last year), largely driven by a 30.9% decline in outbound cargo, combined with a much lesser decline in inbound cargo (down 3.5%). Nawiliwili, Kauai also showed a decrease in overall cargo volume (down 2.5%), also largely driven by a decline in outbound cargo (11.9%), combined with a very slight decline in inbound cargo (down 0.2%).

Maakala cargo. Courtesy of Young Brothers.

Rounding out the neighbor island ports, Young Brothers’ smallest facility in Kaumalapau, Lanai experienced a 5.3% increase in overall cargo volume from first quarter of last year.

“At this point in the year, it’s difficult to pinpoint what the specific economic drivers are because every neighbor island is unique and there are a number of variables from month to month,” Hong said.

“One thing we are heartened to see is that the volume of local agricultural shipments that qualified for our ‘island agricultural product’ discount program is increasing (up 16.2%), which we hope is in response to growing interest in locally-grown food. We believe that growth in our state’s agriculture sector is critical for Hawaii.”

Young Brothers offers a 30% to 35% discount on the price of shipping locally grown agricultural products including fruits, vegetables, macadamia nuts, coffee, meat, poultry, eggs, honey, and nursery plants.

Hong cautioned that the modest increase in 2012 shipping volumes must be considered in the appropriate context. “First, it’s still early in the year. Second, volume in the comparable quarter of 2011 was at the lowest level of the recent recession. Last, volume in the first quarter of 2012 remains well below the peak volumes seen in 2007,” he said.

Thus far in 2012, Young Brothers reports that its quarterly statewide volume is about 20% lower than the same period in 2007.

Note regarding CPE unit of measurement: In the water carrier industry generally, it may be necessary to measure and compare cargo flows across different sizes of containers (e.g., 20-foot, 24-foot, 40-foot and 45-foot containers). The industry uses the standard measurement of “TEU,” or twenty-foot equivalent unit, which refers to a container size standard of twenty feet, to ensure that measurements and comparisons are equivalent.