by James A. Bacon
Virginia’s maritime industry has long anticipated the arrival of the new giant, post-Panamax ships, and now they’re here — a couple of years before they were anticipated, and well before the completion of the Panama Canal expansion that is expected to release the floodgates. As the East Coast port with the deepest channels, Hampton Roads is attracting more than its share. The leviathans pose special logistical problems but the maritime industry is working through them. Virginia Business has the story here.
As author Jessica Sabbath writes, the world’s largest ships can carry twice the number of containers that the big ships of 10 years ago could. These bad boys represent almost 60% of the shipping world’s total cargo capacity. Any port with growth ambitions will have to accommodate them.
The Ports of Virginia planned for the arrival of the big ships by digging 50-foot channels, the deepest on the East Coast, and erecting modern cranes that can reach across the wide-girthed vessels. But by virtue of their enormous size, the post-Panamax ships require more precision in their handling and scheduling. If Virginia’s ports can climb the learning curve faster than other ports, they can create an important competitive advantage even as rivals seek to deepen their own shipping channels.
The big ships must move more slowly to avoid damaging wake. They require especially high-powered tugboats to maneuver in tight quarters. Because the big ships take longer to unload, longshoremen work longer shifts. Even with longer shifts, the maritime industry has added more than 200 longshoremen to handle the increased cargo volume — which increased 8.8 percent to a record 2.5 million TEUs (equivalent to 5 million containers) in Fiscal Year 2015.
The movement of these giants through the ports and their containers through the supply chain creates issues of vessel bunching and equipment imbalance. Shippers often scramble to find available motor carriers. When bunching occurs — it can take more than 24 hours to transfer a container from the ship to a Norfolk Southern railroad train — shippers and motor carriers experience larger demurrage fees. These are the kinds of problems would expect anywhere in similar circumstances, and they take time to sort out. If the maritime community does so successfully, Hampton Roads could well enjoy years of growth and job creation.
Interestingly, one issue that Sabbath did not mention: roads. The McDonnell administration had feared that clogged roads would make it more difficult to ship containers out of Norfolk and Portsmouth. Adding capacity to the Midtown and Downtown tunnels should alleviate localized congestion. But plans for upgrading the U.S. 460 highway connection between Suffolk and Petersburg were sharply curtailed after a funding debacle. Norfolk Southern is accommodating some of the surge in freight traffic with its double-stacked trains destined for Midwest markets. Judging by the article’s silence on the subject, highway congestion has not yet emerged as a bottleneck for the maritime industry’s growth. But if freight traffic continues growing at last year’s pace, congestion could become an issue.