Charting the Course

Based on what authorities continue to report, none of the nation’s container ports will be able to handle the projected increase in container volume in the foreseeable future. Mr. Norman Y. Mineta, Secretary of the U.S. Department of Transportation, and certainly one of the best known of these authorities, stated about a year ago, that of the 361 ports in the U.S. only 60 are presently equipped to handle containers. He predicted, however, that another 200 ports will be handling containers in the pressing years to come. From his vantage point he is able to survey and evaluate the entire length of the nation’s stressed out supply chain, and his unique position enables him to see more clearly not only the hurdles that must be overcome, but also those that must be sidestepped.

As an example, the AAPA began studying capacity limitations long before the general public became aware of them, and its advisories, recommendations and admonitions are widely distributed and respected by maritime interests. In March of 2003, in a letter to the House Appropriations Subcommittee on Energy and Water Development, the AAPA pointed out that the $ 179 million requested by the administration for deep-draft construction projects (dredging) was far less than the hoped-for minimum of $ 459 million. Two years earlier, however, in his criticism of the “hub-and-spoke”concept, James Hartung of the AAPA had wisely alerted officials to some of the problems in that concept, and cautioned against the use of large container ships. He said that concentrating truck and rail traffic at a few ports would worsen congestion, and pointedly asked, “If you took the traffic of Philadelphia and Baltimore and other ports and shoved that into New York, what kind of issues would we be dealing with?” To deal with those “issues”, as we now know, would require a price tag that neither the taxpayer nor the Office of Management and Budget (also the taxpayer) would consider acceptable. Mr. Neil Davidson of Drewry Shipping Consultants in London was even more direct a few months ago when he stated that; “The bigger the ship, the more transshipment and feedering you need, and that costs money … With ports under pressure to reduce air pollution and traffic congestion caused by trucks, they will not, as they did in the past, automatically build bigger terminals and dredge their harbors deeper each time carriers introduce a new generation of ships. Eventually ports will say, ‘We can’t do it anymore.’” That’s the double-edged sword Mr. Everhard was warning us about at Port Industry Day back in July of 2000. “Public funding of dredging amounts to a subsidy of shipping companies building such vessels”, he said. Mr. Everhard’s assessment was an accurate one. First, we pick up the tab for the dredging, then as a result of this dredging we’re forced to eat the added costs of transportation from faraway “king ports”.

If we read between the lines, this is what Mr. Mineta was implying. By offloading container ships at ports closer to the end user, instead of at distant “king ports”, the industry will reduce traffic congestion, vehicle pollution, and across-the-board expenses for the taxpayer and consumer. Smaller, shallow draft ships, readily available at a lower cost to shipping lines, will service these conveniently located ports and require no dredging. Mr. Secretary foresees a win-win scenario.