Under the Bridge

Under the Bridge

As the opening of an expanded Panama Canal nears, with the greater capacity carrying potential to change ocean trade currents between the Pacific and Atlantic, frustration at the Port of New York and New Jersey is mounting. It has been obvious for several years that the Bayonne Bridge is too low to allow giant ships to reach the port’s main terminals and inland rail connections, and yet there still is no final plan to remove the bridge, raise it, or do something to eliminate an obstacle to ship traffic and to the jobs and economic health shipping brings to the region.

“We’re frustrated that the process is taking as long as it’s taking,” said Joe Curto, president of the New York Shipping Association, which represents marine terminals. “We are disappointed that at this point in time we are still trying to identify the solution.”

Previews of what the port can expect more of in the future are coming with increasing frequency.

Many a captain has quietly held his breath as ships slip beneath the bridge with just a few feet of clearance. A string of APL ships had to be modified with lower smokestacks before they could be put into a Suez service that calls at the port, and even then the boatswain has to take down an antenna to prevent a collision.

Last month, a “K” Line ship had to divert to the port’s Global Terminal in New York harbor, where the bridge does not impede access. Last year, an NYK Line vessel had to divert to Norfolk to load additional containers so it would be deep enough to pass under the bridge. The ship had initially arrived at New York and took on bunker fuel at Staten Island in an attempt to weigh it down enough to pass underneath. Had it discharged its containers at the terminal, it would have sat too high to pass under outbound.

This fundamental problem with basic infrastructure has become an increasingly significant issue because of the recession; many ships are carrying fewer containers and so sit higher in the water, narrowing the gap between the ship and the bridge.

Those are merely warning signs, however. What has not yet occurred is the nightmare scenario for the port: container ships whose designs simply would not allow them to pass under the bridge under any circumstances. That is why the port has not seen significant diversion of cargo to other ports because of the air draft limitations posed by the bridge.

But that day is nearing unless a fix is found, and businesses that work the port believe they would see a permanent loss of cargo if supply chains were routed through other gateways because of access limitations. The Panama Canal will allow ships of 12,000 TEUs to transit the canal, compared with the 5,000-TEU ship that typically calls at the Port of New York and New Jersey today. Carriers eventually will send the massive ships from Asia to the East Coast and will employ favorable pricing to encourage customers to use them. They will do this not only because bigger ships bring lower per-slot operating costs for the carrier, but also because there will be so many more of the world’s biggest ships around in a few years.

Despite many vessel order delays and cancellations, 157 ships with capacity of between 10,000 and 15,000 TEUs are on order at shipyards, representing half of all container ship capacity on order today, according to May’s Monthly Monitor from Alphaliner. If they can’t come to New York-New Jersey, they may just go to Norfolk and send cargo onward from there via truck or rail.

Officials at the Port Authority of New York and New Jersey are under increasing pressure to act; resolutions calling for a solution were recently approved by both the New York and New Jersey legislatures and governors. After seemingly shrugging aside the problem as late as 2008, the port has done an about-face, pledging in strong words to find a solution. But the recession and resulting revenue declines from port authority tolls and airports have hit the agency’s financing capacity, and now outside financing sources may need to be tapped.

“We were concerned some time ago that the lack of financial resources was in fact delaying the decision,” Curto said. “We repeated several times to the port authority to find a proper engineering solution and we will try to help you find the money.”

The potential solutions are expensive or controversial. Some want the bridge span simply taken down and replaced with a ferry service, at least until a new and higher span could be built, allowing a solution in place the moment the Panama Canal expansion is completed. Curto said it would be OK if by that point a plan was moving forward, even if not completed.

Curto remains optimistic: “Despite being disappointed, I am still confident that the port authority will eventually make a decision that satisfies the maritime community.”

Peter Tirschwell is senior vice president for strategy at UBM Global Trade. Contact him at ptirschwell@joc.com.