International Trade

Global opportunities emerge for KC region.

Kansas City is by no means a New York or Los Angeles, but the metropolitan region is increasingly stepping up from its traditional second-tier status in terms of international trade, and indications are there’s plenty more of that in our future.

Al Figuly, director of both the Missouri and Kansas area Foreign Trade Zones, said business has been good—even very good—in the area. “Kansas City has a premier focus, is very dynamic and has a very internationally appealing trade strategy that sets routes into and out of the area in a very good position,” he said. “We are a high, second-tier distribution center competing nationwide and competing very successfully.” The fact that the upward trend is years old is significant.

A look at customers of the zones is also revealing. The region’s two major automotive manufacturers,
Ford Motor Co. and General Motors, are among the users of the trade zones. Additional users are Bayer Corp. and Pfizer, as well as Kawasaki Motors and Yulshin USA, a manufacturer based in Kirksville.

The level of that success is surprising. Figuly said the area’s two foreign trade operations, which cover western Missouri and eastern Kansas, combined for almost $1 billion in work over the past year. With new technology and recent economic trends, he expects to see that increase.

“We’re rolling out cutting-edge technology right now that will allow people to monitor where their cargo is with complete transparency,” he said. “It’s a real advantage for them and a significant advantage for us.”

The program seeks to address widespread industry choke points such as border delays, unreliable shipment data, and general communication. The program dovetails with a U.S. Department of Transportation-sponsored Electronic Freight Management initiative, which applies Web technologies to improve information transmission for supply-chain participants.

Figuly said the effort was primarily one of software development, designed to operate on multiple platforms. “It interfaces with existing technology,” he said. “Very few companies are rolling out electronic platforms in a manner that allows folks who want to monitor where their cargo is at … whether they are purchaser, broker, third-party logistics or customs official.”

The region’s advantages and recent growth in international trade are grounded in location. “Nationally as well as internationally, metropolitan Kansas City is in an ideal location,” Figuly said. “We’re at a crossroads in several ways that are increasingly important and are likely to become more important going forward. We are also seeing effective strategies to help our overall development of that advantage.”

Other elements may include a more balanced view of imports and exports. Private companies, as well as Congress, Figuly said, are recognizing that imports often help feed exports.

Other indicators of global trends at work in the United States: the two huge intermodal centers operating at the former Richards-Gebaur Air Force Base and being planned near Edgerton in southwest Johnson County, on the Kansas side. The two are involved in many economic trends and have several differences, but both are in part the result of major changes of direction in logistics. A simple explanation involves the two-year-old CenterPoint–KCS intermodal site in south Kansas City, whose partner Kansas City Southern Railroad owns lines to a Pacific port in Mexico. That international connection and its rail route to a Kansas City trucking hub is a likely roadmap for the direction of international trade here.

Dan Jensen of Kessinger/Hunter & Co. offers additional perspective on why such an operation is practical in Kansas City: lack of congestion.

“There’s a port in southwest Canada and they can ship to Chicago in three days,” he noted. “But then it takes three more days to get through Chicago.” KC Southern’s connection to a Mexican port or Burlington Northern Santa Fe’s California routes, as well as the area’s ability to reach any location in the country within three days.

Figuly sees development of the intermodal centers here as significant for other reasons, too. “Those are huge,” he said. “They increase Kansas City’s status as a trade hub and add to our base now and in the future.”