Accelerating global trade growth translated into record import volumes for many major U.S. container ports in 2017, welcome news for ports in the U.S. Southeast, many of which are beginning or already in the midst of major expansion projects.
As detailed in this month’s feature story “Rising tide” (pg. 35-37), the U.S. port sector is booming. Steady economic growth and a strong dollar have translated to heightened consumer demand, with several major container ports setting new records for import volumes. Zooming in on U.S. South Atlantic ports, new expansion and dredging projects are being unveiled at a rapid pace as facilities look to keep up with the increased volumes and accommodate the larger containerships now calling there on a regular basis.
Along with the increase in cargo, ports along the South Atlantic coast have seen bigger boxships since the expanded Panama Canal opened in June 2016, allowing vessels of more than 14,000 TEUs to transit the waterway. The larger ships also mean the cargo is more highly concentrated, coming of just one ship when previously two smaller vessels might have sailed in its place. South Atlantic ports can expect to be frequented by even more of these larger containerships, as vessels in the 14,000-TEU class are likely to continue to trickle down to the transpacific trade between Asia and North America from the Asia-North Europe lane, where carriers are deploying the newest, largest containerships. And with shipbuilding prices relatively low, carriers are continuing to order and introduce ultra-large containerships of over 20,000 TEUs on the Asia-North Europe trade despite worries from some within the industry that this will exacerbate existing overcapacity and dampen the recovery in freight rates seen throughout 2017.
The pressure on U.S. ports, which have lagged well behind their Asian and European counterparts in terms of infrastructure development, to be prepared to handle larger containerships is palpable, as ports must stay one step ahead of the competition in order to entice and retain business from a shrinking carrier pool. Consolidation among major carriers and alliances, as well as the increasing size of containerships, has resulted in a bit of a feast-or-famine market for ports, as there are fewer services but greater volumes to be captured.
Big containerships can pose big challenges for ports, however, requiring them to have deep enough channels and harbors, wide enough turning basins, enough large ship-to-shore cranes, efficient drayage and/ or on-dock rail facilities, and plenty of storage yard capacity, since larger vessels mean more cargo unloaded at once.
U.S. ports stay one step
ahead of the competition
in order to entice
and retain business
from a shrinking
carrier pool.
Sunshine State. Ahead of the Panama Canal expansion, PortMiami became the first southeastern port to declare itself “big ship” ready in September 2015. The South Florida seaport has a channel depth of 52 feet and 50 feet at the turning basin.
At Port Everglades, just 22 miles to the north, the Port Everglades Navigation Improvements Project received federal authorization in December 2016 for the U.S. Army Corps of Engineers to move forward with the deepening and widening of the port’s navigation channels as part of the Water Infrastructure Improvements for the Nation (WIIN) Act, signed into law on Dec. 16, 2016 by former President Barack Obama.
“The main features of the project are to deepen the main navigational channels from 42 feet to 48 feet (plus 1-foot required and another 1-foot allowable overdepth for a total of 50 feet), and to deepen and widen the entrance channel and parts of the intracoastal waterway so that cargo ships can pass safely by docked cruise ships,” Port Everglades has said.
That project, however, is still in the pre-construction engineering and design phase, a port spokesperson told American Shipper in November.
Back in May, Port Everglades, which noted how it was berth constrained, received unanimous approval from the Broward County Board of County Commissioners to begin a $437.5 million expansion project to add new berths for larger cargo ships and install crane rail infrastructure for new super post-Panamax cranes.
Dubbed the Southport Turning Notch Expansion (STNE) project, the expansion will lengthen the existing deepwater turnaround area for cargo ships from approximately 900 feet to 2,400 feet, which will allow for up to five new cargo berths. In addition, the existing gantry crane rails will be extended to the full length of the extended Turning Notch berth to use the existing cranes, the port said. A Port Everglades spokesperson in late November said there were no new updates on the STNE project and that it was also still in the pre-construction and design phase.
In the meantime, the port has plans to order three low-profile super post-Panamax container-handling gantry cranes before the end of 2017, the spokesperson said. The cranes will cost $13.8 million each and are being constructed by Chinese equipment manufacturer Shanghai Zhenhua Heavy Industries (ZPMC). The port has the option to buy three more cranes any time within five years of this first order.
The ZPMC cranes will be equipped to handle containers stacked eight units high and 22 across a ship’s deck, the port said. The port’s existing seven gantry cranes in the Southport area, where most of its containerized cargo handling takes place, are limited to containers stacked five units high and 16 across.
In Northeast Florida, the board of directors of the Jacksonville Port Authority (JaxPort) in June unanimously approved the start of the Jacksonville Harbor Deepening project, allocating the first phase of port funding to the U.S. Army Corps of Engineers for construction.
“Along with significant state funding already in place, the $484 million, 11-mile project recently received $21.5 million in federal funds, along with a new start designation, making it eligible for further federal dollars,” JaxPort said at the time.
The federal project to deepen the Jacksonville shipping channel from 40 feet to 47 feet was initially set to begin by the end of 2017, a JaxPort spokesperson told American Shipper in November, adding that the entire project will take five to six years.
However, on Dec. 4, the St. Johns Riverkeeper filed a motion for preliminary injunction to postpone the first phase of the project. The nonprofit environmental advocacy group said that in 2013, the Army Corps authorized JaxPort’s plan to deepen the last 13 miles of the St. Johns River channel to 47 feet, but earlier this year, the port unveiled a new plan that involved dredging just 11 miles of the channel to cut costs.
“This new 11-mile plan simply does not exist, according to the Army Corps,” said Lisa Rinaman, the St. Johns Riverkeeper. “Federal law requires JaxPort’s new plan to be thoroughly studied and evaluated, including the recalculation of the benefit-cost ratio, yet nothing has been done by the Corps to fulfill this requirement.”
Commenting on the St. Johns Riverkeeper’s attempt to delay the first phase of the project, an Army Corps spokesperson told American Shipper on Dec. 6, “We continue to move forward with the Jacksonville Harbor Deepening project,” and that the Army Corps anticipates the project will start in “late January.”
The port has also been snagging new business in the automobile sector over the last few years, and now ranks as the second busiest auto-handling port in the country.
In response to higher demand for vehicle space, the port is constructing a new automobile processing terminal expected to be completed by late 2018. The terminal is the first phase of a multi-year project at the port that will boost its vehicle-handling capacity by 25 percent.
Up The Coast. A little further north, in Savannah, Ga., the Georgia Ports Authority (GPA) has various notable projects in the works.
The Savannah Harbor Expansion Project (SHEP), which is currently underway, is deepening the outer harbor to 49 feet at low tide (56 feet at high tide) and the inner harbor to 47 feet (54 feet at high tide). The Army Corps is overseeing the project, which is scheduled for completion in late 2020, GPA said.
In addition, the Port of Savannah in November received four ship-to-shore cranes, which are tall enough to lift containers 152 feet above the dock. The booms reach out 192 feet from the dock face and the lift capacity for each crane is 72 tons. The cranes are 412 feet tall with the booms up. One of the cranes will go into service in February, followed by two in March and one in April. An additional six ship-to-shore cranes will arrive in 2020.
Once all of these cranes are commissioned, including the six to arrive in 2020, a total of 36 cranes on dock will then allow Savannah’s Garden City Terminal to move 1,300 containers per hour on and off vessels, according to GPA officials.
Also in November, GPA’s board approved rail and gate expansion projects that will boost capacity at the Garden City Terminal. The board approved expenditures of $42.27 million as part of GPA’s $128 million Mason Mega Rail Terminal. When complete, the project will double the port’s on-dock rail lift capacity to 1 million containers per year.
So far, a total of $90.7 million has been allocated to the project, construction of which is slated for completion by the end of 2020.
In addition, the board approved a $13.2 million project to expand the existing Gate 8 at the Garden City Terminal. GPA said the addition will allow it to absorb future growth, and will offer a better link to the Jimmy Deloach Parkway, which provides a direct truck route to Interstate 95.
A GPA spokesperson told American Shipper in November the gate expansion project is expected to be completed in September 2018. Overall, the project will boost the terminal’s gate infrastructure by 12.5 percent for a total of 54 truck lanes, GPA said.
At the Port of Charleston in South Carolina, the Army Corps awarded the Great Lakes Dredge and Dock Company, LLC a $47 million contract in September and a $213 million contract in October for work in the Charleston Harbor Entrance Channel as part of the Charleston Harbor Post 45 Deepening Project.
Combined, these two contracts awarded to the Great Lakes Dredge and Dock Company “will achieve the newly authorized depth of 54 feet throughout the more than 20-mile long Charleston Harbor Entrance Channel,” the Army Corps said.
The second contract was the final contract required to complete the deepening of the entrance channel, and is part of the overall $529 million cost of the Charleston Harbor deepening project, which in addition to bringing the entrance channel to a depth of 54 feet, will also involve deepening the main channel in Charleston from 45 feet to 52 feet.
In October, SCPA’s board of directors also approved a $69.5 million order for six new ship-to-shore (STS) cranes from ZPMC.
“When the cranes arrive in late 2019, deepening of the Charleston Harbor to 52 feet will be nearly two-thirds complete, and construction of our new container terminal will also be nearly finished,” SCPA President and CEO Jim Newsome said.
Five of the cranes will provide a 169-foot lift height and will be delivered to the Hugh K. Leatherman, Sr. Terminal. The first phase of the terminal is scheduled to open in mid-2020 with an annual container handling capacity of 628,000 TEUs.
The sixth crane, which will stand at 155 feet, will be delivered to the Wando Welch Terminal. “The Wando Terminal received its first two cranes of this size in August 2016, and ZPMC is currently manufacturing two additional cranes for delivery in February 2018,” SCPA said. “By 2020, nine of the 13 STS cranes at the Wando Terminal will offer 155 feet of lift height to support SCPA’s efficient handling of two 14,000-TEU vessels simultaneously.”
Stacking Up. In the mid-Atlantic region, the Port of Virginia, which offers 50-foot channels, inbound and outbound, is currently two years into a study to evaluate and assess the potential return on investment on a proposed target depth of 55 feet.
“Our goal is to have the study complete by mid-to-late 2018, which will give us the necessary information and data to begin discussing funding, develop a work agenda by early 2019 and begin work as soon as possible thereafter,” a Port of Virginia spokesperson told American Shipper in November.
The port is currently in the midst of a fully funded, three-year, $670 million expansion of its two primary container handling terminals—the Virginia International Gateway (VIG) and Norfolk International Terminals (NIT). Consequently, by 2020, the port will have expanded its annual overall throughput capacity by 40 percent, or 1 million containers.
In August 2017, the Port of Virginia signed a contract that authorized the purchase of four new ship-to-shore cranes, which are being built by ZPMC and set for delivery in April 2019. The Virginia Port Authority board of commissioners in its July 2017 meeting approved a spending package of $44.8 million, covering the cost of the cranes and associated parts, as well as their delivery and installation at VIG.
In November 2016, the port finalized a $217 million contract with Konecranes to build and deliver 86 rail-mounted gantry cranes (RMGs). A port spokesperson said the first group of RMGs is scheduled to arrive at VIG fully assembled in January 2018 and be operational by April 2018. From that point forward, the port will receive regular deliveries (about every six weeks) of the RMGs to VIG and then NIT through mid-2019.
Meanwhile, the Port of Baltimore’s Seagirt Marine Terminal already sports a 50-foot deep berth, allowing it to handle the larger containerships being deployed on the Asia-U.S. East Coast trade.
Looking at how these seven ports compare to one another in terms of fully cellular container services connecting them to regions outside of North America, the Port of Savannah is frequented by 33, followed by the Port of Norfolk with 29, Port Everglades with 27, the Port of Charleston with 25, Port Miami with 15, JaxPort with 11 and the Port of Baltimore with seven, according to ocean carrier schedule and capacity database BlueWater Reporting’s Port Dashboard tool.
The largest ships to call any of these seven ports are two 14,414-TEU ships—the CMA CGM John Adams and the CMA CGM Theodore Roosevelt, both of which are deployed on the OCEAN Alliance’s dedicated Asia-East Coast North America SAX/ECX1 service. The loop deploys 11 vessels averaging 13,386 TEUs and has a rotation of Hong Kong, Yantian, Ningbo, Shanghai, New York, Norfolk, Savannah, Charleston and Hong Kong.
Looking ahead, with all of the expansion projects in the works up and down the U.S. South Atlantic coast, it will be interesting to see what potential investments will be unveiled at these ports in 2018, along with how port and other landside infrastructure as a whole will hold up as carriers continue to deploy larger containerships across the world’s busiest global trade lanes.