s46_use of containers to carry bulk & breakbulk commodities and its impact on gulf region ports and...
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Use of Containers to Carry Bulk and Breakbulk
Commodities and its Impact on Gulf Region Portsand International Trade
The Panama Canal Expansion (PCE) WillIncrease the Containerization of Bulk and BreakbulkCargo and Significantly Impact International Trafficalong the East Coast of the US, in the Gulf, and at
Louisiana Ports
James R. AmdalAsaf Ashar, PhD.
UNO Transportation Institute
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Study Tasks
1. Review Professional Literature, Daily News Briefs andRelated Source Materials on Container Traffic and
International Trade within North, Central and South America
2. Identify Related Infrastructure Projects and Timelines
(Quantify Competitive Port Environment)3. Create an Advisory Task Force on Trade Lane Dynamics and
Commodity Flow Volumes
4. Identify Promising Commodities with Growth Projections
5. Identify State Incentive Programs or Related Inducements
to Grow Import and Export Volumes
6. Final Report
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Relevant Existing Conditions Affecting LA Ports and the MR.
1. No significant traffic generator for containers using Mississippi River.
2. Neither new transport technologies or enhanced landside infrastructurewill appreciably change this situation.
3. North - South container trade flows are unbalanced with
insufficient north bound traffic to support Container On Barge service.
4. No Asian Service currently serves a MR port.
5. Insufficient container traffic precludes the MR being considered as a
viable National Marine Highway.
6. Limited # of containers for shipment of LA agricultural commodities
(rice to Houston, coffee to New Orleans)
Consequently UNOTI is investigating the impact of the Panama Canal
Expansion or other container trade generators on Gulf Coast import
export flows and LA ports
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The Panama Canal Expansion will double its existing
capacity and add 5M new TEUs in the Gulf
$5.2B construction complete mid 2015
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Vessel Size Comparison
Sector Existing Panamax Post Panamax
Container Approx. 4,200 TEU Approx. 13,200 TEU
Beam Limited Length Limited
Dry Bulk Approx. 85,000 dwt Capesize in ballast
Approx. 120,000 dwt laden
Draft limited
Tanker Approx. 80,000 dwt Suezmax in ballast
Beam limited Approx. 120,000 dwt laden
Draft limited
Source: Professor Paul Stott
at the Low Carbon Shipping Conference 2012
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Port of New Orleans: Containers and International Trade
1. Rapid growth in container trade:
2011 TEUs 427,515 33% empties
2010 TEUs 328,878 28% empties
Existing Napoleon Avenue Container Terminal capacity = 640,000 TEUs.Phase 3= +200,000 TEU
Max Build-out = 1.5M TEU (Sufficient capacity)
2 Napoleon Avenue Container Terminal is served by MSC, CMA CGM, Maersk, Zim,
Seaboard Marine, CSAV, Libra, Hapag-Lloyd & Hamburg Sud
3. New Container Service to Central and South America by Hamburg Sud. Serves
Cauceda, DR; Buenos Aires, Argentina; Montevideo, Uruguay; Rio Grande, Suape,
Navegentes & Rio de Janeiro, Brazil
4. 2011 LA exports top historic record (grew 45.6%)
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What is the competitive environment for LA?
Pacific Northwest Cluster: Seattle,
Tacoma, Greater Vancouver andPrince Rupert, BC
Los Angeles / Long Beach
Lazaro Cardenas, Mexico
New York / New Jersey Southeast Cluster: Baltimore,
Charleston, Savannah, JAXPORT,
Miami
Gulf Coast: Tampa, Mobile, New
Orleans, Houston
Central / South America: Colon,
Panama; Cartagena, Colombia
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Detailed Project Inventory
PANYNJ Increasing Height of Bayonne Bridge 64 = $1B
Port of Charleston Harbor Deepening = $300M State Funds Only
Port of Savannah Harbor Expansion = $652M ($181M from State)
Environmental LitigationJAXPORT St. John River Dredging to 47 = $100 x (TBD)
Port of Miami Channel Dredging to 50 = $180M, Rail Rehab = $50M
New Truck Tunnel = $915M
Port of Houston Channel Deepening from 40 to 45 = $112M2013 Terminal Upgrades / New Equipment = $228M
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Recently retired PCA CEO Alberto Zubieta stated: the main
beneficiaries of the PCE will be the East Coast and Gulf
Coast of the United States. Mr. Zubieta believes that the PCE will make
U.S. grain exports as well as crude oil and natural gas (derived from oilshale) more competitive on the world market. It will also increase U.S.
coal shipments to China and Asia.
He made no mention of the PCEs impact on the container trade but this
is a topic of intense interest to ports in North, Central and South
America. Most experts agree +5M new containers in Gulf.
Opinions vary widely but all agree the PCE will impact world trade. They
disagree on where and to what degree
That is the $64B question we and our Advisory Committee are seeking
to answer for LA.
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Impact of Jones Act on US Coastal
Shipping
Asaf Ashar
UNO Transportation InstituteNational Ports & Waterways Initiative
www.asafashar.com
February 19, 2013
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Jones Act BackgroundThe Merchant Marine Act of 1920 is a federal statute
that regulates maritime commerce in U.S. waters and
between U.S. ports. Section 27 specifically deals with
cabotage (coastal shipping) and stipulates that all goods
transported by water between U.S. ports must becarried in U.S.-flag ships, constructed in the U.S., owned
by U.S. citizens and crewed by U.S. citizens and U.S.
permanent residents. When passed into law, the intent
of this Act was to support the U.S. maritime industry.
The following charts illustrate its effect.
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Objective: Divert Freight to Marine Highway
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AMH Initiative
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US vs. Foreign Ship Costs
Construction Cost
US Containership $200 million, Foreign $35 million
a 5.7 multiplier Operating Cost (Labor)
US Containership $21,194/ Day, Foreign $9,583/Day
a 2.2 multiplier Externalities
Environment (Congestion, Hwy Maintenance, AirPollution)
National Defense (Dual Use); more expensive ships(structure, speed, range)
Hawaii Free Press, Jan 2012; DOT/MarAd 2011; Ashar 2012
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Jones Act Waiver
US Flag Remains Intact US CrewRemains, but Functional Crew
Size is smaller
US Built Temporary Waiver, Reflag ForeignBuilt
Only Coastwise Routes for Containers/Trailers
(no off-shore to Puerto Rico, Alaska, Hawaii) Precedent with Product Tankers
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Selected Case Studies
Domestic Short (500 NM) Inter-Regional, Nation-Wide
Frequency 2+/week
International Short(
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Potential Service Routes
CCDOT 2011; American Feeder Line 2012; Ashar 2012
Domestic Routes Feeder Routes
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Selected Ships for Case Studies
Yonge, 2011; Kunkle; AFL; Ashar 2012
Domestic Long: 285 53-ft; 25 k; CassettesDomestic Short: 100 53-ft; 18 k;
Road Chassis
Feeder: 992 TEUs, 53-ft; 14 k;
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2,926 ships in 1960
231 ships in 2010
Remake a US Flagged Fleet
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