The completion of the South Florida port’s Deep Dredge project paves way for PortMiami to handle mega-size container ships from Asia.
Florida state and local dignitaries celebrated the completion of a $220 million dredging project to deepen the PortMiami harbor to 50 feet, a key threshold for ports seeking to receive next-generation, post-Panamax container vessels and the larger cargo volumes they represent, with a ribbon-cutting ceremony Friday.
Officials expect that ships between 8,000 TEUs and 10,000 TEUs will start calling in Miami next year once the expansion of the Panama Canal is finally completed, with the potential for vessels up to 13,000 TEUs on the Asia trade lane to reach the port through the Atlantic-Pacific shortcut. So far, however, no container lines have committed to deploy larger box ships to Miami.
“There are four or five different carriers that have very seriously inquired about our ability to berth a vessel of that size” within 24 months of the Canal’s opening, Port Director Juan Kuryla said in an interview.
The new Panama Canal locks are tentatively scheduled to open for traffic by April, but some construction glitches and protests by laborers have slowed work recently. Canal officials, however, have said that the water leak in one of the locks is not expected to change the opening date for the Canal.
Kuryla also told American Shipper that container volume at PortMiami is on track to reach 1 million TEUs for the fiscal year ending Sept. 30, which would be an increase of about 16 percent from the 876,677 TEUs handled the previous year. Container business in fiscal year 2013-14 was down 2.7 percent from 901,454 TEUs. In fiscal year 2012-13, container volumes stood at 909,917 TEUs.
The port director said Miami has experienced a bump in imports from Asia as shippers diverted some cargo from the West Coast to avoid congestion issues associated with last winter’s contract dispute for dockworkers and ongoing operational challenges – a scenario that has also boosted business at several other ports along the East and Gulf coasts.
Miami’s ability to service cargo in a timely manner means much of the new business likely will become permanent, Kuryla added. Truck turn times for a double move – container drop and pick up – are about 70 to 80 minutes, and up to two hours in some cases, which compares favorably with congested ports such as New York/New Jersey and Norfolk.
Contributing to the recent growth have been U.S. Agriculture Department approval for businesses using cold-treatment protocols for pests to import grapes, citrus and blueberries from Peru; apples and pears, blueberries from Argentina; and blueberries and grapes from Uruguay directly into South Florida, instead of requiring them to be sent to northern ports in Philadelphia or Wilmington, Del., where the pests can’t survive, and trucking the produce back to Florida. PortMiami has experienced a 20 to 25 percent increase in its throughput of perishable products thanks to the new program, Eric Olafson, the port’s trade development manager, said.
Exports at the port are also on the rise, with some of the increase due to new business from containerized grain shipments from the Midwest, Kuryla said. He pointed out that three of the new consolidated carrier alliances – the G6, 2M and Ocean3 – have made Miami a port of call in the past couple of years as the port has become more globally connected due to the Panama Canal expansion and its own infrastructure upgrades.
In July, German liner operator Hamburg Süd returned to PortMiami for the first time in more than a decade as the carrier puts more emphasis on its East-West lanes. It is operating one vessel as an adjunct partner on an Ocean3 Alliance string that operates between Chinese and U.S. East Coast ports.
The port’s Latin America and Caribbean trade, which includes perishables, has also grown significantly, primarily because of new business captured by Seaboard Marine. The regional ocean carrier is responsible for 45 percent to 48 percent of PortMiami’s total container throughput.
There are still skeptics who question whether Miami can attract more than one or two services due to its distance from many population centers compared to other ports. Florida doesn’t have a huge manufacturing base for exports, and the port faces growth constraints on the man-made island upon which it rests.
Florida Gov. Rick Scott and Lt. Gov. Carlos Lopez-Cantera praised the partnership between the state Department of Transportation, Miami-Dade County, the U.S. Army Corps of Engineers and environmental agencies that made the harbor deepening possible, but criticized Congress for not following through with money for the federal share of the construction costs.
The state of Florida contributed $112 million toward the project, including the $77 million the federal government is supposed to take care of under formulas set out by law. PortMiami and Miami-Dade County invested $108 million, with some of the money going to wharf-strengthening and other improvements related to the dredging.
“I’m very hopeful the federal government will gives us the money back that they haven’t put up,” Scott told reporters after the event at the PortMiami cruise terminal, adding that it is the “fair” thing to do.
Officials touted the economic benefits to South Florida and the state from increased sea trade associated with big ships.
Miami-Dade County Mayor Carlos Gimenez and others said deepening the harbor from 42 feet to 50 feet, and 52 feet at the entrance channel, would result in the creation of up to 33,000 direct and indirect jobs in the region and create $7 billion in additional wealth as the money from port fees, logistics salaries, and increased manufacturing revenues for exports is spent in the local economy. The projections were from port economist John Martin, who has made a career of helping ports around the nation make the economic case for new infrastructure development. But some experts say economic impacts can be difficult to quantify and that studies sometimes overstate the benefits because of how they are conducted or because they only consider selective outcomes.
Gov. Scott has convinced the state legislature to invest $850 million over the past four years in the state’s 15 seaports as a way to increase trade-related jobs, which are up by 150,000 in that period.
The PortMiami harbor deepening is the first of five major port expansions to be completed in an expedited fashion under the Obama administration’s 2012 “We Can’t Wait” initiative, designed to streamline the slow bureaucratic process for obtaining federal approval on infrastructure projects. The project took more than 17 years from conceptual planning to construction, but would have taken several more years without coordination by the White House.
Five different dredge vessels removed more than five million cubic yards of rock, limestone and sand for the PortMiami project, which included widening the entrance channel to 800 feet, according to the Army Corps of Engineers.
Environmentalists, however, have criticized the Army Corps of Engineers for its management of the deep dredge project, saying that silting damaged important coral formations in Biscayne Bay.
“Dramatic statements were made about the effects of the dredging in Miami, specifically regarding sedimentation impacts to offshore resources. Contrary to these statements, sedimentation effects were anticipated and are expected to be of a short-term duration with no long-lasting effect on the ecosystem,” Col. Jason Kirk, the Corps of Engineers’ Jacksonville district commander, said in a statement.
“This project has been performed to the highest standards of environmental sensitivity,” Kuryla insisted. “We have a five-year monitoring period during which we’ll address any latent effects and if there are any we will do whatever we need to do to remediate that. And we’ll continue to work hand in hand and in good spirt with the environmental groups.
“We’re great stewards of the environment. We’re also the cruise capital of the world. Part of the attraction to the cruise lines is people can spend a day here, look at the water, go to the beaches, go snorkeling. So we don’t want to damange the bay, the reefs.”
Already completed mitigation features of the project include the creation of 17 acres of new seagrass beds and more than 11 acres of new artificial reef with thousands of coral relocations.
The 50-foot draft is one of four infrastructure investments at PortMiami designed to improve cargo capacity and efficiency, and thereby attract big ships and their customers, whose preferences ocean carriers tend to accommodate.
In August 2014, authorities opened a tunnel connecting the port directly to the interstate highway system to make it easier for container shuttle-trucks, cruise passengers, taxis, buses and cruise suppliers to reach the port. The new access way – built at a cost of more than $900 million as a public-private partnership between the state, county and investors – was projected to eliminate 1 million truck trips per year from downtown streets and shave 25 minutes from a drayage truck’s round trip to the port, potentially making it possible for drivers to fit in at least one more revenue-bearing trip in their regulated day.
Last year, the Florida East Coast Railway finished the second and final phase of its on-dock rail facility for ship-to-rail transfer of intermodal boxes. The short-line railroad, which operates between Miami and Jacksonville, is trying to convert truck traffic to rail for cargo moving between Central Florida and the port using its terminal in Cocoa Beach.
Another key target market is the Midwest and Eastern U.S., with port and rail officials touting the ability of shippers to reach 70 percent of the U.S. population in four days or less by rail and 25 percent of the population in two days or less by offloading in Miami as an alternative to ships transiting the Panama Canal stopping at other ports along the eastern seaboard. In both cases, the railroad can directly move containers along its north-south line or haul them to its yard near Miami International Airport where a sister company operates the South Florida Logistics Center and can transload goods into 53-foot domestic containers, store them, or manipulate them into higher-value packages before distribution by truck or rail. Officials say goods offloaded in Miami can be at a customer distribution center faster than using a slow ship to sail up the East Coast, especially since the entrance is close to open water compared to some ports that require ships to travel several miles up river.
The FECR connects with mainlines CSX and Norfolk Southern, the two primary long-haul rail service providers in the eastern half of the United States, in Jacksonville.
The $50 million rail project included restoring a neglected main line to the rail bridge that connects the mainland with PortMiami, rehabilitating a damaged rail bridge, and modifying the Hialeah yard near the airport to handle the increase in intermodal traffic. The project was supported by a $23 million TIGER grant from the federal Department of Transportation, about $9 million from the Florida Department of Transportation and $5 million from Miami-Dade County.
Kuryla said both investments have been a rousing success so far. The FEC Railway is moving about 45,000 containers a year and has capacity to handle up to 225,000 boxes annually with 9,000 linear feet of rail on three on-dock tracks, he said.
The access tunnel has also met expectations, according to the port director. About 90 percent of drayage trucks use the tunnel. The ones that aren’t are carrying prohibited hazardous material cargo and use the downtown bridge instead.
“You drive in downtown Miami on any given day at noon or 1 o’clock, you see no trucks practically. Traffic has improved beautifully,” Kuryla said.
PortMiami also invested in several super post-Panamax cranes with a reach of 22 containers to load and unload ultra-large container vessels.
Miami is the closest port to Cuba. Asked if PortMiami could play a significant trade role if, and when, U.S.-Cuba relations are normalized and the trade embargo is lifted, Kuryla said there is already a lot of private sector interest in establishing ferry operations to the island nation and that cruise lines are also looking at their options.
PortMiami enters ‘big ship era’ with new 50-foot harbor
