Will Cuba be the Next Major Transportation Hub?


For cargo shipping, focus is on the Cuban port, Container Terminal Mariel (TC Mariel) which opened in January 2014. The Obama Administration has made it easier for container services to add Cuba as a port of call since they’ve reopened embassies and ended a 54-year diplomatic standstill with the country. In May 2016, the first US cruise ship docked in Cuba since 1978 – opening the door to more travel and business with Cuba, but there are still limitations on trade in goods and services – the US trade embargo is still in place.

The US Office of Foreign Assets Control broadened allowances for US vessels carrying certain agricultural or otherwise approved cargoes, extending them to non-US vessels. “Cuba does have the potential to act as a transshipment hub for US cargo, in a similar way to how Freeport, Bahamas does now,” said Drewry.

Cuba’s Mariel container terminal has modern facilities, including the ability to handle refrigerated shipments and weigh trucks leaving or entering the terminal. The terminal is located 27 miles from Cuba’s capital Havana, just 90 miles from Florida.

TC Mariel has plans to be a major transshipment hub. In May 2016, TC Mariel’s General Director, Charles Baker, described growth at the terminal, its short- and long-term expansion plans and strategy to diversify beyond domestic cargo into transshipment. China does more than $10 billion worth of trade with Cuba each year.

In 2014, the Cuban container terminal handled 230,000 twenty foot equivalent units (TEU). In 2015, throughput at Mariel grew 35%, reaching 330,000 TEUs, and has been up 29% in the first half of 2016 as a result of Cuba’s tourism trade. In early 2015, it was reported by Seatrade-Maritime News that 51% of the terminal’s movements were imports and 49% were exports. The terminal is targeting to hold about 85% of the country’s exports.

The US Department of Commerce’s Bureau of Industry and Security is now allowing vessels to transport approved cargo originating in the US to Cuba and then sail to other counties with any remaining cargo that had also been loaded at a US port.

TC Mariel aims to be the first port of call for megaships passing through the newly expanded Panama Canal. Baker suggests dropping off cargo in TC Mariel and sending it to Gulf ports to attract shippers by improving transit times. He says, “to ship to Mobile Alabama, you’ll have to wait for the vessel to sail in and out of Houston and New Orleans before it gets there.” Baker continues, “When we talk to the carriers and the ports, they recognize the advantages of our geography, but they also recognize very clearly that the US embargo stands in the way of the opportunity we have.”

Cuba could be an ideal location for cross-docking or resorting and distributing cargo from large ships to smaller vessels headed for the US ports. Cuba’s shipping facilities have potential to be a key shipping hub for the region.

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Source: WSJ, JOC, JOC


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