Planning for the Panama Canal Planning for the Panama Canal Expansion – A Port PerspectiveExpansion – A Port Perspective

Richard WainioRichard WainioPort Director and Chief ExecutivePort Director and Chief Executive

Tampa Port AuthorityTampa Port AuthorityOctober 21, 2009October 21, 2009

Tampa OverviewTampa Overview

Florida’s largest port in tonnage and area Diverse traffic base Major cruise home port Expanding container gateway

Port of Tampa Perspective - SummaryPort of Tampa Perspective - Summary

Immediate priority – capturing larger share of huge local market

Panama Canal expansion one of several variables impacting growth forecast

Prudent/incremental approach to facilities expansion as business develops

TampaTampaBay Bay

MarketMarket

• • Geographic center of state Geographic center of state • • 5,742 square miles5,742 square miles• • 8 million people within 100 miles8 million people within 100 miles

• • Expanding distribution center gatewayExpanding distribution center gateway• • Current local market potential= + 400K TEUsCurrent local market potential= + 400K TEUs• • 1.9 Million Labor Force1.9 Million Labor Force

Central Florida Container MarketCentral Florida Container Market

•

Tampa

Direct 350K TEUSTransload 50K TEUS

Total (est.): 400K TEUS

Direct 350K TEUSTransload 50K TEUS

Total (est.): 400K TEUS

Port SharePort Share

Expanding Distribution Expanding Distribution Center GatewayCenter Gateway

Companies such as Rooms to Go, Southern Wines & Spirits, Lowes, Wal-Mart, Havertys, Pepsico, Bealls, United Natural Foods, Kane’s Furniture, VF Image Wear, Ace Hardware, SYSCO/International Food Group, Corvest, Publix, and Perry Ellis are among firms that have recently constructed and/or expanded distribution centers in the region.

CSX is planning to develop an Integrated Logistics Center at Winter Haven in Polk County – 50 miles due east of the Port of Tampa. Phase I will include a 300 acre container and vehicle rail terminal and Phase II, a 950 acre distribution center park.

Key to the Port of Tampa’s container growth has been the Executive Shippers’ Council representing over 140 importers and exporters within 100 miles who control over 250,000 TEUs and are keen to support container carriers that call Tampa direct.

The Gulf Coast is becoming an The Gulf Coast is becoming an increasingly attractive marketincreasingly attractive market

Expanding vessel capacity provides opportunity for carriers Expanding vessel capacity provides opportunity for carriers to add new services and serve distinct complementary to add new services and serve distinct complementary markets in US Gulfmarkets in US Gulf

Major investments in port capacity and distribution centers is Major investments in port capacity and distribution centers is increasing the Gulf Coast’s attractivenessincreasing the Gulf Coast’s attractiveness• Tampa:Tampa: major expansion capability and growing DC major expansion capability and growing DC

industryindustry• Houston:Houston: Bayport expansion doubling capacity and Bayport expansion doubling capacity and

growing DC growing DC industry • Mobile:Mobile: container terminal expansion and auto industry container terminal expansion and auto industry • Louisiana:Louisiana: four proposed container terminal projects four proposed container terminal projects

under considerationunder consideration

Panama Canal ExpansionPanama Canal Expansion

Canal Expansion ImplicationsCanal Expansion Implications

Potential shift of up to 25% of West Coast cargo Potential shift of up to 25% of West Coast cargo to East/Gulf Coast portsto East/Gulf Coast ports

New post-Panamax direct services combined New post-Panamax direct services combined with expanded Caribbean transshipment will with expanded Caribbean transshipment will create opportunities for both regional and create opportunities for both regional and intermodal portsintermodal ports

Market opportunities vary by region and stateMarket opportunities vary by region and state Not all ports need to be deepened to 45’ or 50’ Not all ports need to be deepened to 45’ or 50’

to benefit; nor will all ports gain significant new to benefit; nor will all ports gain significant new business.business.

System EncouragesSystem Encourages “Keeping up with the Joneses” Behavior – “Keeping up with the Joneses” Behavior –

But at What Cost?But at What Cost?

If my neighbor is dredging to 45-50’ feet – I must do the same

Lobby for USACE authorization – Just in case we may need it down the road

Is this the most efficient use of resources? - How many deep water ports do we need?

More than just dredging costs – also access infrastructure (road, rail, tunnel, etc.)

P. CABELLOP. of SPAIN

RIO HAINASAN JUAN

CAUCEDO

Caribbean Transshipment Triangle

FREEPORT

COLON/MIT

KINGSTON

CARTAGENA

Shipping and Trade DevelopmentsShipping and Trade Developments

Economic downturn and gradual recovery in world trade

Ocean carrier overcapacity – benefits all-water route

Larger vessels – deeper ports – load centers – transshipment

All-water East/Gulf Coast vs. West Coast Intermodal

Concerns with West Coast productivity and new fees

Shipper port diversification strategies and growth in East/Gulf Coast distribution center capacity

Concerns about port/transportation infrastructure capacity deficit overstated

Many Variables Cloud the ForecastMany Variables Cloud the Forecast

Ocean carrier service deployment strategies – all-water direct vs. Caribbean transshipment

Logistics & supply chain strategies - large import DCs vs. regional DCs close to population centers

Fuel prices Ocean carrier pricing strategies Truck & rail service patterns

What’s Tampa Doing to Prepare?What’s Tampa Doing to Prepare?

Identifying the real market opportunities and Identifying the real market opportunities and recognizing the limitations.recognizing the limitations.

Expanding container terminal capacity – phased Expanding container terminal capacity – phased expansion in line with market growthexpansion in line with market growth

Improving truck access to Interstate highway Improving truck access to Interstate highway system – I-4 Crosstown connector underwaysystem – I-4 Crosstown connector underway

Improving rail accessImproving rail access addition of on-dock rail in future phases of addition of on-dock rail in future phases of

terminal expansionterminal expansion CSX Winterhaven Integrated Logistics CenterCSX Winterhaven Integrated Logistics Center

Container Terminal ExpansionContainer Terminal Expansion

• Phased incremental approach as volumes grow and business case dictates

• Served by a 43 feet deepwater channel, 2100 feet of berth and three gantry cranes, and 100 ton mobile harbor crane

• Expansion now underway to increase from today’s 25 acres to 40 acres by end of 2009

• Phased expansions to 160 acres and 2700 feet of berth over next 3-5 years

I-4/Crosstown I-4/Crosstown ConnectorConnector

Tampa added to Horizon Line’s Puerto Rico service

Other North-South trade potential including Cuba

Opportunities from Canal Opportunities from Canal Expansion but Latin America Expansion but Latin America

Remains key to Florida/TampaRemains key to Florida/Tampa

Shifting International Trade RoutesShifting International Trade Routes Conference Conference

January 26-27, 2010January 26-27, 2010Grand Hyatt Tampa BayGrand Hyatt Tampa Bay

Co-sponsored by AAPA & MARAD and hosted by Tampa Port Co-sponsored by AAPA & MARAD and hosted by Tampa Port AuthorityAuthority

Alberto Aleman, Administrator of the Panama Canal Authority will Alberto Aleman, Administrator of the Panama Canal Authority will provide an update on the status of the Canal expansionprovide an update on the status of the Canal expansion

Speakers will address the international economic outlook and Speakers will address the international economic outlook and shifts in global trade patterns; examine the role of transshipment shifts in global trade patterns; examine the role of transshipment and the Caribbean Basin; and discuss infrastructure needs from and the Caribbean Basin; and discuss infrastructure needs from the perspective of cargo owners, ocean carriers, ports, terminal the perspective of cargo owners, ocean carriers, ports, terminal operators, warehouse and distribution centers, and highway and operators, warehouse and distribution centers, and highway and rail interests. rail interests. 

For more info visit: For more info visit:

http://aapa.files.cms-plus.com/PDFs/09_ShiftingTradeRoutes.pdfhttp://aapa.files.cms-plus.com/PDFs/09_ShiftingTradeRoutes.pdf