Closure of Port of Kobe Will Disrupt Shipping Worldwide

The closure of the port of Kobe, which handles about 10% of Japan’s ocean freight, will disrupt shipping around the world.

Only five ports in the world carry more container cargo than Kobe, which handles 170 million tons of cargo a year, the highest volume in Japan.

Kobe lies in one of Japan’s industrial heartlands, and its home prefecture of Hyogo accounts for 5.7% of national output, a report by J.P. Morgan economist Jesper Koll said.

The harbor at Kobe is one of the busiest shipping partners for both the Port of Los Angeles and the Port of Long Beach, and Southern California officials are concerned about reports that the Japanese trading center could be out of operation for months.

The city typically receives fruit, beef and pork from Southern California’s ports and ships a significant amount of electronics and home appliances back.

Kobe is Los Angeles’ third-biggest trading partner, responsible for 4% of imports and exports into San Pedro. The Japanese city is No. 5 on the trading list for Long Beach, making up about 6% of its business.

“We are very concerned about the situation in Kobe,” said Hal Hilliard, marketing manager for the Port of Long Beach. “We don’t know how the steamship lines will be able to divert cargo to other ports in Japan. It’s too early to tell, but there’s a lot of scrambling going on out there.”

But economists pointed out that since about 85% of Kobe’s cargo is in containers that can be diverted to other ports, the impact on Japan’s overall economy may not be great.