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Distributors keep growing as area business prospers

December 4, 2016

Three of the biggest distribution complexes in the Baytown/Chambers County area are doing their part of help with the area’s growth.

Representatives from TGS Cedar Port, AmeriPort and Katoen Natie spoke about this at the third annual Baytown-West Chambers County Industrial Expansion Symposium Friday. The Lee College Center for Workforce and Community Development and the Baytown-West Chambers County Economic Development Foundation hosted the event.

TGS Cedar Port
TGS Cedar Port President of Construction and Maintenance Divisions James Scott gave an overview on projects involving the industrial park.

Scott said that an IKEA Distribution Facility is coming, with an expected move-in date of this month. The furniture giant will have two 500,000-sqaure-foot rail-served warehouses. “One million square feet the Cedar Port’s 2.6 million square footage in now in Phase 1 of construction,” Scott said.

Clay Development is leasing the area. They plan to move into the second building in the first quarter of 2017.

Ravago, a plastics distribution giant, has purchased 170 acres at Cedar Port where they plan to develop 700,000 square feet of warehousing and administration offices. In addition, the company will build a rail yard for up to 200 railcars.

The initial estimate of capital improvements of the company is between $70 and $75 billion, and they are expected to create about 100 jobs in first two years.

There are also railcar expansions that have expanded from 1,500 stored railcars in 2014 to 1,800 in 2015. Scott said they are also building 1,200 railcars spots to expand to over 3,000. In addition, they are about 50 percent complete with Phase 1 for 500 railcars spots and will complete this phase in the first quarter of 2017.

The park is also expanding interchange tracks by constructing a total of five new 9,000-foot tracks to bring the total to six.

“This will increase capacity to Cedar Port for both United Pacific and BNSF Railway,” Scott said. “All six interchange tracks will be under the Grand Parkway overpass, so there will be no traffic interruptions.”

Scott said that they plan to have more distribution centers due to close proximity to the Port of Houston and the Grand Parkway as well as more plastic resin packagers due to large rail and barge advantages. Other future projects center on small special chemical plants, small refinery and liquid logistic terminals, large chemical complexes and large rail intensive industrial projects.

Chairman and CEO of Plank Companies, Michael Plank talked about the advantages of being in Chambers County.

This included the county being pro-development, having tax abatements and incentive packages, being in a foreign trade zones, having access to heavy haul corridors, the ability to utilize a skilled labor force, having highway networks and the efforts of the Baytown-West Chambers County Economic Development Foundation. At AmeriPort, they have Delta Companies, Palmer Logistics, Plantgistix, GEODIS (with Red Bull products would be stored there), the Pilot/Flying J Terminal and the Fly Ash Terminal.

Katoen Natie
Katoen Natie Vice President of Sales Brandon Huynh talked about how the Belgium-based logistics service provider and port operator is contributing to the growth in Baytown/Chambers County.

“We’ve been around a long time, since 1855,” Huynh said. “And we are still growing.” Huynh said the company had 200 employees in 1989 and now has more than 14,000. “Our core business is plastics, with about 40 million tons produced every year,” he said. “Our goal is not to have as many customers as possible, but to have the right balance of customers.” Huynh asked what was coming next for the company.

“We heard about the expansions just in this area,” he said.

Huynh said the addition of some gas crackers in the area, including the ones at ExxonMobil and Chevron Phillips, caught their attention.

“What is expected with the new polyethylene production?” Huynh said. “With new polyethylene plants being built, new production will begin. In the U.S. alone, this could add between 6 to 8 million tons of new polyethylene capacity by 2017 to 2020.”

In 2016, Huynh said that the total NAFTA production of polyolefins is about 35.5 million metric tons with the total packaging capacity in the NAFTA region being about 11.5 million metric tons. In addition, the total exports from Katoen Natie’s NAFTA Region are about 7.5 million metric tons. By 2018, Huynh said they expect these figures to increase to 44.5 million, 17.5 million and 13.5 metric tons, respectively.

The change of production and handling from now to 2018 is expected to increase as well. For the total NAFTA production of polyolefins, Huynh said they expect it to increase by 25 percent. For the total packaging capacity in the NAFTA region, 52 percent and for the total exports out of NAFTA region, 80 percent.

To address the growth, Huynh said they will have large sites with high capacity storage, flexible packaging capabilities and high speed packaging equipment.

By Matt Hollis