CHARLESTON BECOMES NO. 4 BOX PORT

CHARLESTON BECOMES NO. 4 BOX PORT

The Port of Charleston, S.C., leaped past Oakland, Calif., and inched ahead of Seattle to become the nation's fourth-busiest container port with robust, double-digit growth for five consecutive quarters.

Long Beach leads the nation in container handling, followed by Los Angeles and then New York-New Jersey.Charleston's container cargo surged at a 19 percent clip last year and is continuing at a hefty 21 percent pace this year in its battle with Savannah, Ga., to emerge as the South Atlantic's load center.

Healthy growth on all import and export trade routes to its primary markets of Europe and Asia and with both coasts of South America primarily triggered that expansion, said George Young, Charleston's new director of marketing and sales.

''Charleston is growing so strongly because they have most of the large container lines and it is a very efficient, highly productive port in terms of vessel turnaround time,'' said Jim Brennan, principal, Mercer Management Consulting of Lexington, Mass. ''They also have a good geographical location to take advantage of the booming Southeast market all the way to the Mississippi River.''

Charleston will continue to be locked in a fierce battle with nearby Savannah for at least five or seven more years, however, before a single area load center emerges north of Florida, Mr. Brennan said.

The need to develop increasingly expensive areas of land, pressure to win critical funding and environmental constraints on expansion are the key issues in that competition, Mr. Brennan said.

''The main reason that battle will continue is that neither port has the capacity to handle every one of the area's top 12 to 15 container lines or to move the continuing growth in cargo in the Southeast,'' he said. ''Charleston is the major port of call for the majority of those lines, however, and their growth has been a key factor in the port's strong expansion.''

Charleston's cargo jumped, to 954,945 20-foot equivalent units in 1997 from 800,599 TEUs the year before, as the Port of Seattle grew just 1 percent, to 952,588 TEUs in 1997 from 938,546 TEUs, according to PIERS, the Port Import/Export Reporting Service of The Journal of Commerce. Charleston then climbed at a 21 percent pace in January-February, PIERS said, as Savannah grew at a 16 percent clip last year and a 10 percent pace this year as the 11th busiest U.S. containerport.

''North Europe and the Mediterranean account for about 40 percent of our cargo, North and Southeast Asia for roughly another 40 percent and our growing trade with South America now represents about 15 percent,'' Mr. Young said. ''But Africa is strong, China is constantly expanding, and we think that's good because we're not forced to live or die with just one trade lane.''

Charleston is planning for projected growth with a $300 million expansion that includes a fourth container terminal with 3,000 feet of consecutive, linear berthing space and roughly 200 acres of container storage, Mr. Young said. The new container terminal will be built on the 1,300 acres of land on adjacent Daniel Island that the port was able to acquire in several stages over the past few years, he said.

The port has also received design approval from the U.S. Army Corps of Engineers on its $159 million plans to dredge its entrance channels, to 47 feet from 42 feet, and inner channels, to 45 feet from 42 feet. Charleston currently handles post-Panamax container ships that carry up to 4,200 to 4,300 TEUs and the channel deepening should remove any major obstacles when even larger vessels become common along the East Coast.

''We expect to start the deepening project late this year by spending about $35 million and expect that the federal-port funding will be in the area of $85 million federal and $74 million for the port,'' Mr. Young said. ''We're still lobbying for more federal funding, like everybody else, but I feel certain we'll start the dredging this year and finish it in five or six years.''

Construction on the new container terminal is expected to start early next year and should be completed by 2003, Mr. Young said, after the environmental permitting process that began last summer is finalized. The terminal will provide a third on-dock railhead for daily freight that currently moves inland to the South and Midwest by both CSX Transportation Corp. and Norfolk Southern Corp.

RAIL PART OF PROJECT

The project will also include an additional 11 miles of rail development, a two-mile road connection and a second bridge that connects the new access road to nearby Interstate 526, he said. The vast majority of Charleston's inland movements are handled by truck, and overnight truck service is standard within a 450-mile radius of the port for full truckloads and within 300 miles for less-than-truckloads.

Charleston is increasingly moving away from being a so-called wheeled port operator, where containers are locked into truck chassis and ready to move, to one where the boxes are stacked on the ground, Mr. Young said. ''Our carriers are turning more toward stacking containers because you need less land and the newer container gantry cranes are more efficient and make it easier to do that,'' he said.

SLOW TO DEVELOP

A chassis pool that the port launched four months ago has been slow in developing, however, into the extensive carrier cost savings that was projected at its three existing container terminals, carriers said. The common-user pool was designed to significantly reduce costly chassis inventory for carriers but failed to unfold at either Wando Welsh or Columbus Street container terminals.

The equipment pool has been successful at North Charleston Terminal, however, where it has generated substantial cost and time savings for Mediterranean Shipping Co., said John Mullaney, MSC's senior vice president. ''The truckers are probably cutting a half hour from their average, 90-minute truck turnaround times on a typical drop-off, pickup container move,'' Mr. Mullaney said.

FIVE PARTICIPATE

Carriers hit alternating peaks and valleys in their chassis equipment needs and participating lines can dip into the pool to supplement equipment demands on peak days and then turn in excess chassis when demand tapers off. Sixteen lines were initially expected to join the pool at the three terminals but only five are now participating, Mullaney said.

''We decided to move a little more prudently on the chassis pool than we initially planned to but fully expect to move ahead with it because of the strong savings in inventory costs it represents for carriers,'' Mr. Young said.

Containerized freight accounts for 92 percent to 93 percent of Charleston's total cargo where exports typically outnumber imports by roughly 60 percent to 40 percent.