March Madness

Just as college sports fans can debate endlessly about the superiority of their programs during the NCAA basketball tournament, the maritime industry’s debate over which ports will expand market share and which will drop in the rankings when the Panama Canal expansion project is completed in 2014 has become a seasonal rite in Long Beach.

The East versus West Coast debate was certainly alive and well at this month’s Trans-Pacific Maritime Conference. Present and past executive port directors from New York-New Jersey, Virginia, Charleston, Savannah and Long Beach, as well as longshoremen from the East and West coasts, all had something to say in the debate.

Peter Peyton, past president of International Longshore and Warehouse Union Local 63 in Southern California, prefaced his remarks by noting that as a longshoreman, he felt no pressure to be politically correct, so he gave his uncensored view of the competition. Peyton compared East Coast ports with 99-cent stores and Los Angeles-Long Beach with Saks Fifth Avenue. An East Coast port can brag about its dozen or so cranes, 42- to 48-foot water depth and several hundred million square feet of regional warehouse space, but when Los Angeles-Long Beach weighs in with 143 cranes, a 76-foot channel depth and 1.7 billion square feet of regional distribution space, which port will really impress a potential customer? Peyton asked.

While such comparisons are always fun, or irritating, depending upon one’s loyalties, the main takeaway from this year’s TPM was that deep harbors, an excellent port infrastructure and extensive warehouse distribution space provide only the physical capacity to accommodate the big container ships that will comprise the bulk of the global container fleet in the coming years. The ease of doing business, the efficiency of the marine terminals, the quality of road and rail access and the reliability of the labor force will determine which ports will be major gateways and which will be second-tier ports.

Ocean carriers, through their vessel orders, have decreed that even second-tier ports will have to find a way to accommodate vessels with a capacity of 8,000 20-foot equivalent container units or larger. With 70 percent of the current order book comprised of giant ships, carriers are telling ports that if they want to be anything more than a feeder port, they must be able to accommodate big vessels.

But physical capacity is only the price of admission to compete in this sport. To be a top seed (regional mega-port), a gateway must offer the ultimate customers — the shippers — the best value for their money. Efficient cargo-handling, fast truck turn times, seamless container transfers from vessels to intermodal trains, distribution facilities with congestion-free access, reasonable port fees and a skilled, reliable labor force will determine which ports go to the Big Dance and which will watch the games on television.

Contact Bill Mongelluzzo at bmongelluzzo@joc.com. Follow him on Twitter @billmongelluzzo.

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