TACOMA'S BID TO WIN BACK BULK CARGO RAISES IRE, DOUBTS AT SMALLER PORTS

TACOMA'S BID TO WIN BACK BULK CARGO RAISES IRE, DOUBTS AT SMALLER PORTS

The Port of Tacoma wants to recapture non-container cargo business it has lost to smaller Puget Sound ports. Port officials decided on the strategy to fight declining revenues, which are down $2.3 million from 1992.

Even though the port remains profitable and well-positioned for growth, cargo tonnage is projected to fall 2 percent from 1992, according to a recent port cargo forecast.But the port's new marketing goal has directors of some smaller ports steamed. Pat O'Malley, a Tacoma port commissioner, also has objected to the plan.

John Mohr, executive director of the Port of Olympia, said this week that Tacoma's new plan is "cause for concern."

The policy is a change in posture for Tacoma, he said. It doesn't make sense for a large port like Tacoma to try to take back lower-value cargo business to raise revenue, he added.

"I don't see how the Port of Tacoma can be competitive with small ports in this. We've got lower costs," Mr. Mohr said.

Breakbulk cargo - items such as machinery and wood pulp that are not packed into containers for shipping - amounts to only 5 percent of Tacoma's annual business, Mr. O'Malley said. But for ports like Olympia and Grays Harbor, it's 100 percent of their business.

In the past, breakbulk cargo came to Tacoma because smaller ports were handling logs, Mr. O'Malley said.

But the log export business has dropped 40 percent or more at small ports, forcing them to seek more non-container cargo.

Grays Harbor is unloading aluminum ingots from Russia. Olympia recently shipped 26,000 barrels of butter oil to Russia and promotes its ability to handle specialized cargo. Olympia is trying to form a free-trade zone.

Mr. O'Malley fears that by taking some of that cargo from the smaller ports, Tacoma might incur the wrath of the federal government, which is pouring aid into the failing timber port communities.

"If Tacoma is successful in recapturing lost bulk cargo in any appreciable manner, it could devastate these other bulk cargo ports," he said.

"In light of the Clinton administration's timber policy and promises to restore the economy to the (Olympic) peninsula, destroying these ports would be condemned by the congressional delegation as well as the administration," Mr. O'Malley said in an Oct. 6 letter to fellow commissioners and senior staff members.

Mr. O'Malley confirmed the contents of the letter Tuesday. Mr. O'Malley's claims aren't relevant, said Bob Earley, another port commissioner. Tacoma has to make every effort to recover lost revenue, he said.

"There's nothing new here," Mr. Earley said. "There's only so much bulk cargo. Unfortunately, it's a sign of the times. I wish we could do something different, but everybody's down."

John Terpstra, executive director, said the port's first allegiance is to Tacoma, not to the small ports.

"It's not shoddy at all to go after that business," he said.

More breakbulk cargo means more high-paying longshore jobs, because the cargo requires more workers to move it. High-quality jobs are also good for the community, Mr. Terpstra said.