The Panama Canal expansion project scheduled for completion in 2015 will make it imperative that the Southeast has a container port with a 50-foot draft to handle vessels with a capacity of up to 12,500 20-foot containers, according to the top port executive in Charleston.
It won’t be imports that will make a 50-foot draft critical in the Southeast, however. “This is very much driven by the export market,” Jim Newsome, president and CEO of the South Carolina Ports Authority, told the South Carolina International Trade Conference Monday.
East Coast ports from New York-New Jersey to Miami intend to deepen their harbors so they can handle the big ships that are flooding the global liner industry.
According to the consulting firm Alphaliner, 52 percent of the global container fleet by the end of 2015 will be post-Panamax, with 34 percent of the fleet ranging in size up to 10,000-TEU capacity, and 18 percent 10,000-plus-TEU capacity.
East Coast ports that have a 50-foot depth, or are authorized to dredge to that depth, include New York-New Jersey, Baltimore, Norfolk and Miami, Newsome said. The normal port rotation on all-water services to and from Asia is New York-New Jersey, Norfolk and a South Atlantic port. Vessels calling at ports in the South Atlantic will require a 50-foot draft without relying upon tidal variations in order to top out with exports.
Newsome said this “last call theory” is based on the fact that U.S. exports to Asia are increasing rapidly, and export cargoes are generally heavier than imports. “There needs to be a harbor in the Southeast that is 50 feet because that is where the exports are,” he said. The Southeast is becoming a center of manufacturing and agricultural exports.
Harbor-deepening projects are quite costly. Newsome said Charleston’s harbor-deepening project would cost more than $300 million. Savannah’s proposed deepening project is projected to cost $652 million, and that will only get the port to a 47-foot depth, Newsome said.
“From a harbor depth perspective, Charleston has and will maintain an edge over other southeastern ports,” he said. Considering that Charleston, Savannah and Jacksonville hope to attract federal funding for a portion of their harbor deepening projects, the ports will be competing on the basis of which project has the best cost-benefit ratio.
It appears Congress today intends to channel scarce funding to fewer ports, and in this new environment, “we think we are the best value,” Newsome said.