The Port of Long Beach has lately endured severe congestion, a dockworker shortage and torrential rain that damaged connecting rail lines. It was rewarded Friday with an improved outlook by Moody's Investors Service.
Moody's bumped up the port's long-term debt outlook to positive from stable, representing the rating service's assessment of the harbor's financial health.
Moody's also assigned a rating of Aa3 to the port's new California Harbor Revenue Refunding Bonds, Series 2005A and 2005B. The $248.4 million in Series 2005A bonds and $25.4 million in Series 2005B bonds have an expected sale date of Friday.
Moody's cited a number of factors in the port's favor, including its ability to lock major customers such as Hanjin Shipping Co. into 25-year leases. The port's expansion efforts have allowed it to accommodate the largest container vessels in use.
Moody's also pointed to "the likelihood of little significant competition from other West Coast ports." That is in spite of the fact that ports all along the West Coast are expanding in an attempt to grab a share of rising cargo containership traffic.
"That is not a near-term concern. You need a very strong infrastructure, strong intermodal connections and nearby distribution centers," Moody's analyst Ed Roche said. "It's a long-term process."