‘WHERE’S MY

CARGO?’West Coast congestion underscores the need

for near-real-time visibility on container shipments

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JACKSONVILLE TRADE AND TRANSPORTATION

THE QUIET PORT TAKES CHARGE

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H istorically, the profile of a Florida port was fairly standardized: excellent access

to and from markets within the Florida peninsula and favored stops for vessels and freight moving in the north-south trades to Central and South America as well as the islands. More recently, factors such as the emergence of load centering, robust population growth in the southeast United States and substantial investments in facilities and access infrastructure are expanding the span of influence of ports in Florida. Nowhere is this more apparent than in Jacksonville.

The region is a gateway not just for Florida but for the Southeast, East Coast, Puerto Rico and South and Central America, said Doug Wheeler, president and CEO of Florida Ports Council, a professional association for the state’s 15 public seaports.

While the port continues to occupy a position as the logical gateway choice for cargoes

JACKSONVILLE MOVES BEYOND NICHEBy John Powers

48 THE JOURNAL OF COMMERCE www.joc.com MAY 4.2015

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TRADE AND TRANSPORTATION

emanating from, or destined to, in-state destinations, Jacksonville’s position abutting Georgia’s border provides distinct delivery advantages to many markets. From a surface transportation point of view, this means transits up to one day shorter than other Florida ports.

“Our location represents a great advantage for us,” Jaxport’s Roy

Schleicher, executive vice president and chief commercial officer, said. “We are within one day’s truck drive to 60 million U.S. consumers.” Interstate 10 originates in Jacksonville and rolls west to the Pacific. For northbound and southbound traffic, Interstate 95 provides similar unrestricted access to the entire Eastern Seaboard. For shipments destined to and from the Midwest and heartland,

Interstate 75 is only 40 minutes west of the city. In addition, due to the bend of the eastern coastline, Jaxport is situated directly underneath Cleveland, Ohio, further enhancing the region’s ability to provide economical access to the Midwest.

Served by CSX, Norfolk Southern and Florida East Coast railroads, Jacksonville is at the confluence of a vibrant and extensive network for intermodal and

F lorida is home to 15 seaports that cre-ate a dynamic junction for a broad as-

sortment of freight, as well as passengers. They serve a diverse consumer market within the state (and across the country) and are champions of both international trade and domestic cargo movement. Florida is also the closest connection between Latin America/Caribbean trade partners and the U.S. Midwest/Northeast. Florida is also increasing its connections to Asian and European trade lanes.

Florida seaports reap vast economic re-wards for the state that continues to grow despite the recent economic environment. Their cargo and cruise activity currently support nearly 700,000 jobs in Florida. They contribute $96.6 billion of output to the state’s economy, equivalent to about 13 percent of Florida’s gross domestic product.

Together, there is no business or cargo Florida ports can’t handle. They have in place the infrastructure, waterway access and stable workforce to help businesses succeed. They plan to be the seaports of choice for every business in Florida, and for more and more shippers in the U.S. and around the world.

Florida seaports have state leader-ship to thank for an extraordinary level of financial and other support. The focus

on Florida seaports’ role in capturing international trade and improving freight mobility is due to recognition by Florida Governor Rick Scott, the Florida Legis-lature and the Florida Department of Transportation of our critical position in the supply chain. Cooperation at the state level has become a reliable reality, and our ports are working with federal leaders in this important effort as well.

Florida’s seaports are creating mo-mentum around economic vitality. They’ll achieve it by improving global competi-tiveness and increasing mobility for people and freight. They have enhanced the diversity and flexibility of their assets, and are creatively optimizing how those assets are used. They are prioritizing capital investments and generally maximizing the use of scarce resources.

Florida connects local businesses to international markets and global busi-nesses to nearly 20 million residents and 100 million visitors a year. We are proud to deliver, both for our global businesses and to consumers around the world. ■

DELIVERING THE WORLD,AT HOME AND ABROAD

Port Canaveral • Port Citrus • Port Everglades • Port of Fernandina • Port of Fort Pierce • JAXPORT • Port of Key West • Port Manatee PortMiami • Port of Palm Beach • Port Panama City • Port of Pensacola • Port of Port St. Joe • Port of St. Petersburg • Port Tampa Bay

Florida Ports. Delivering Your World. FlaPorts.org

FLORIDA IS YOUR PORTAL FOR EXPORTS AND IMPORTS TO AND FROM MARKETS ALL OVER THE WORLD.Florida ports have cutting-edge intermodal transfer facilities and the capability to handle any cargo from containers, automobiles and bulk products to project and break bulk cargo. With a large built-in consumer market and connections to every international market, from the Caribbean to China, Florida ports are equipped and ready to launch your products around the globe.

DESTINATION: Port Antonio, Jamaica

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other rail shipments as well. Each day, 36 trains leave the port, which offers service throughout the southeast including the major distribution hub of Atlanta. For shipments destined to the upper half of the Midwest, direct rail service to Chicago has a total transit time of 45 hours. Jaxport’s rail itineraries include destinations as far-flung as Texas and the Northeast, Schleicher said.

Lack of congestion is another large competitive advantage that sets Jaxport ahead of many other domestic ports, he added. “Whether it’s rail, highway or the port itself, we have no congestion that would prevent the fluid movement of cargo.”

Container trade through Jacksonville is up 15 percent over the same period last year. The uptick is due primarily to new volumes in the Asian trade lanes, Schleicher said. “We only began to get in to the Asian business in 2009, and we’ve experienced steady growth since.”

The Jacksonville brand is becoming more recognized among international traders, helping push the port’s participation in Asian markets in particular. “People are recognizing that Florida ports provide a very cost-effective option for getting freight to customers. Jacksonville has all of the key assets needed to compete globally: facilities, capacity and rail and highway access to

120 million consumers in the southeast and along the Eastern Seaboard,” Wheeler said.

Jacksonville’s growth in the far Eastern trades has been encouraged by cargo diversions from West Coast ports, which serve as traditional hubs for freight inbound from Asia and the Indian subcontinent. Port backups, road-rail congestion, labor strife and equipment shortages have led many importers to investigate their all-water options to the Gulf and East coasts.

However, actual impact is difficult to measure. “Certainly, some business has moved to Florida. However, we can’t quantify it as yet,” Schleicher said. “The situation is similar to 2002. There are some beneficial cargo owners and importers-exporters who will look more closely at East Coast routings. There have been some shifts, but no mass exodus. However, the BCOs are looking for some security and stability in a less congested setting. Additionally, they find that the

A s the owner and manager of Jackson-ville's public seaport terminals, Jaxport

is committed to the ongoing enhance-ment of port infrastructure and facilities. A number of major growth projects in and around the port are currently in progress.

Jaxport and the U.S. Army Corps of Engineers have two projects underway to improve the commercial viability and economic competitiveness of the St. Johns River harbor: Mile Point, a project removing a navigational restriction and the Jacksonville Harbor Deepening Project, a federal program aimed at deepening the harbor allowing Jaxport to become a first/last port of call for the industry’s larger ships.

The design and engineering phase of the Mile Point project to correct a naviga-tional hazard is completed and construc-tion is beginning. The initial engineering

and design work for the project to deepen the shipping channel is near completion and the project will soon head into the construction phase.

Construction of the Intermodal Con-tainer Transfer Facility at Dames Point, home to the MOL/TraPac Container Terminal, is well under way. The ICTF

will be operational by early next year and will facilitate the direct transfer of containers between vessels and trains. The new facility will complement exist-ing on-dock rail facilities at Jaxport’s Tal-leyrand and Blount Island terminals and further enhance the competitiveness of

the adjacent TraPac Container Terminal. Jaxport continues a comprehensive

infrastructure revitalization program to rebuild docks and rail at both Blount Island and Talleyrand Marine Terminals. This well-designed, phased reconstruction allows operations to continue while fortify-ing the facilities for future growth.

Adding to the larger cranes already in use at Jaxport’s TraPac Container Termi-nal, three new state-of-the-art container

cranes have been purchased for the Blount Island Marine Terminal. The new cranes will have a reach of 22 containers across a ship’s deck, up from the 16 container reach of Blount Island’s current 50-gauge cranes, and

will significantly increase the terminal’s cargo-handling capability. The cranes are currently under construction and will be operational in 2016. ■

Learn more about Jaxport’s major growth projects at JAXPORT.com/projects.

JAXPORT IS INVESTING IN THE FUTURE

“WHETHER IT’S RAIL, HIGHWAY OR THE PORT ITSELF, WE HAVE NO CONGESTION THAT WOULD

PREVENT THE FLUID MOVEMENT OF CARGO.”

JAXPORT. IT’S JUST SMART BUSINESS.As the 4th fastest growing containerized import port in the nation, JAXPORT is now the

port of choice for thousands of businesses worldwide. On the export side, we’re also a

top 10 U.S. port. Located in Northeast Florida in the heart of the South Atlantic, minutes

away from Interstate highways and major rail hubs, your shipment is never more than

a day away from 60 million consumers. Together, we can move your business further.

jaxport.com/cargo

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spirit of port management/shipper/labor cooperation in the southeast and U.S. Gulf is a tangible benefit.”

Cargo shifts go beyond that activity at California ports. “Jacksonville is also capturing shipments from ports to the north burdened with similar

congestion problems. Such re-routings don’t happen overnight. These are major, long-term decisions. However, Jacksonville will continue to benefit from diversions because it is such a viable option,” Wheeler said.

Annually, Florida’s 15 ports handle

more than 100 million tons of cargo and 14 million passengers. Unsurprisingly, the competition for state transportation funding can be fierce, but state officials can rely on the Florida Ports Council for an unbiased evaluation of proposed projects.

“We look at our funding from a strategic point of view,” Wheeler said. “We do a good job of looking at Florida as a system of seaports. We tend to lean

P orts America is the largest terminal operator and stevedore in the United

States, with operations in 42 ports and more than 80 locations.

Ports America is at the forefront in productivity when handling autos and roll-on, roll-off units at the Port of Jacksonville, the No. 1 port for vehicle exports in the United States. At Jaxport, Ports America stevedores autos and ro-ro cargo at Blount Island Marine Terminal, handling 320,000 autos and 14,000 ro-ro units annually.

Ports America also has the capability to handle all types of breakbulk, project, palletized, bulk and various other high and heavy cargoes, including agriculture equipment and construction materials.

BLOUNT ISLAND MARINE TERMINAL SERVICES INCLUDE:— Lift services from vessel to dockside

and vice versa.— Truck loading and unloading for all

types of cargo, including high and heavy.

— Customs and Border Protection clearance.

— Cargo processing and reporting.

BERTHSSIDE: 20 and 22. FRONT: 31, 31, 32, 33, 34 and 35. Ports America has the capability to

work at all eight berths, but is most active at 20, 22, 31 and 33.

EQUIPMENT— Eight forklifts, ranging from 15,000

pounds to 52,000 pounds.— One reach stacker with a capacity of

100,000 pounds.— One gantry whirly crane with a

capacity of 112 tons.

Rail for Blount Island Marine Terminal is provided directly by CSX with on-dock rail access.

ABOUT PORTS AMERICAOperating since 1922 through prede-

cessor companies, Ports America possesses dedicated resources that only a company of such scale and scope can deliver, includ-ing robust training programs, best-in-class technology and experienced management. With a highly skilled and trained labor force, Ports America has the experience and expertise to manage all types of cargo handling. The company handles more than 12.7 million TEUs, 2.5 million vehicles, 8.9 million tons of general cargo and 1.6 million cruise ship passengers. Ports America’s operations include containers, bulk, breakbulk, project cargo, world-class cruise terminals, intermodal facilities and precision ro-ro operations.

Ports America consistently has one of the lowest damage records in North America and its reputation for quality standards is unsurpassed. ■

For additional information, please visit www.PortsAmerica.com.

GLOBAL REACH, LOCAL RESULTS —TERMINAL AND STEVEDORING OPERATIONS

“WE TEND TO LEAN TOWARD PROJECTS THAT MOVE THE

ECONOMIC NEEDLE.”

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TRADE AND TRANSPORTATION

JACKSONVILLE

toward projects that move the economic needle.” There are multiple sources of funds beyond state coffers, including local monies, federal funding and more traditional business approaches such as commercial loans and public-private partnerships, he said. “Jaxport is a key part of Florida’s network of seaports, one of the state’s greatest economic assets affecting every region and resident within the state.”

Among the 15 ports, four of which can be considered “major,” Schleicher said, “we do compete for a fixed bucket of funds. Fortunately the Florida Ports Council and the Florida Department of Transportation make every effort to be equitable. As a result, we have certainly received our fair share of funding for transportation and infrastructure projects.”

As with many of its sister ports, the top priority for Jacksonville is harbor deepening. The pre-construction, engineering and design phase is already in process, and initial engineering and design work is expected to take 18 months. Deepening construction is slated to commence before the end of 2016. The Jacksonville Harbor Deepening Project will take approximately 42 months with completion targeted for 2020. The reconfigured channel will measure in at 47+2 feet.

“During the course of the next year and a half, the U.S. Army Corps of Engineers will design a project with both the economics and the environment as dual priorities. Our attention as a region must turn to ensuring that this project is funded and stays on track so we can return every bit of benefit back to our citizens as soon as possible,” Jaxport Board of Directors Chairman Joe York said at a recent ceremony marking the official start of the project.

The project is vital. “Our key to major growth will be deep water. Vessels are only getting larger. To participate in that fleet, we simply have to be deeper,” Schleicher said, noting that the dramatic spike in vessel size is not limited to container ships — roll-on, roll-off vessels leaving shipyards are also substantially larger than their predecessors. With Jacksonville’s position as one of the top

PortsAmerica.com

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COVERING ALL COASTSProviding stevedoring & terminal operationsin more than 42 U.S. ports and 80 locations

two ro-ro ports in the country, the ability to serve these ships will be required to maintain market share.

A second significant undertaking in Jacksonville is the construction of an intermodal container transfer facility at

Dames Point to facilitate the direct transfer of containers between vessels and trains. With expected completion in 2015, the new ICTF will provide existing and future customers with enhanced intermodal connections, including direct access to CSX-owned rail lines

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and the U.S. interstate system. The facility will complement existing on-dock rail facilities at Jaxport’s Talleyrand and Blount Island terminals and will further enhance the competitiveness of the Blount Island Marine Terminal and TraPac Container Terminal at Dames Point.

“All ports are aware that rail is key. The new ICTF signifies that Jacksonville recognizes the value of rail and is improving its ability to move boxes quickly onto trains,” Wheeler said.

The expectation is that the project will be completed around the end of 2015. “It will give customers a next-to-dock facility that will enable them to bring containers in by yard hustler for direct loading onto trains. This will eliminate the 30-minute drayage to the

existing ramp, resulting in lower costs for shippers and truckers, who will be able to make more yard jockey trips per truck day,” Schleicher said.

Three other major projects are currently slated for Jacksonville. At Blount Island, docks are being rebuilt to 100-gauge capability with 50 feet of water depth alongside. At the Talleyrand terminal, the target is 50 gauge. As evidence of the port’s continuing anticipated growth in ro-ro, they are currently in the permitting phase for a new roll-on, roll-off terminal at Dames Point with a three-year construction window.

“By 2035, cargo shipments to the United States are expected to triple. Since ports are already congested, what happens when we arrive at that point in time? That’s why it’s important to develop

additional capacity,” Schleicher said.Enlargement of the Suez and Panama

canals will have an incremental effect on Jacksonville throughput, he said. “The Panama Canal will be a plus for everybody on the East Coast. The West Coast ports will not give up any substantial chunks of cargo. There will be more of a steady stream than a flood. Nevertheless, there will certainly be an impact.”

The Florida Ports Council reported that a recent study showed 3.5 million TEUs of freight are coming into Florida from out-of-state ports. “This is definitely our low-hanging fruit. We can certainly offer options that are closer and faster to our Florida consumer base. Total container throughput for all Florida ports at this time is in the 3.2 million-TEU range. Obviously, if we could capture a significant portion of the freight moving to Florida through other harbors, this would generate a major boost to our volumes. Best of all, Florida ports can add these shipments without having to take them from other in-state ports,” Wheeler said.

With overall growth in business and burgeoning Asian trade, Florida enjoys an additional advantage in the ability to move import shipments to market. “Florida is an inbound state. Outbound traffic is heavily sought after. Any additional outbound traffic generated by the port will enhance its ability to attract van and flatbed carriers,” said Ports America’s Brian Hogan, director of sales and marketing for auto and ro-ro.

“We were the quiet port that has woken up. Our mission is to educate people about the many things we can do. Our customer base values the fact that we’re very accommodating, and we find that prospective customers really appreciate this aggressive and progressive attitude,” Schleicher said. Jacksonville’s significant investments in channel deepening, a new ICTF and terminal enhancements suggest they intend to continue to further distance themselves from their former role as a niche port. ■

Contact John Powers at john@bottline.com.

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