MCALLEN, Texas - A fundamental shift in attitude towards new business coming in is occurring at the Port of Brownsville, its port director, William Dietrich, has confirmed.
From here on out, the port’s board of directors want to add value to the products coming in. They do not want the port to continue being a throughput, Dietrich said, in an in-depth presentation to the South Texas Manufacturers Association.
“Cross border trade with Mexico? Mexico is our top trading partner. About 90 percent of the total commodities arriving at the Port of Brownsville by ship are shipped to Mexico, including steel, petroleum-based products, aggregate minerals and agricultural products,” Dietrich said.
“Now, we’ve got a lot of businesspeople here. What's the problem with that? I like people to point out problems. We're just a throughput. All we're doing at that point is bringing a commodity in and shipping it over. Who's adding the value to that product?”
Where is the manufacturing happening, Dietrich asked. He answered his own question. Mexico.
“That's where the fundamental change is coming at the Port of Brownsville. What we're looking at right now at the Port of Brownsville is, your industry must have added value. For example, if you're going to bring in steel and then send it off somewhere else to have the car built, that's going to come back and give profit to so many other people in the supply chain… we’ve lost at that point, because all we're doing is bringing it in. The stevedores make a little bit of money. Storage makes a little. Other than that, all the money is going somewhere else.”
Dietrich explained the shift in thinking.
“So, what we're doing right now is, we're highly focused on making sure that we have industry that adds value to the product. For example, you can bring in avocados all day long. Until you make guacamole, it’s not worth a whole lot, you know what I mean?”
Dietrich continued:
“So, when you come in as an industry, you can be tier one, tier two, what is the added value? Why is added value so important? Where does that money stay when there's added value? A lot of it would be captured here. Okay, we will always have the throughput aspect of the Port of Brownsville. But I would like to see that throughput, instead of 90% going to supply Mexican industry, I would like to see it to come in and supply our own industry, here at the port.
“And we can value add at every single level, all the way up until we ship it out and we get the money from someone else to pay for it. That's when you are going to start seeing a big change in the economic demographic of the region. Right there.”
