By Don C. Brunell
Get ready! More colossal container ships are coming.
Our region got a glimpse of the future this leap year when the Benjamin Franklin sailed into Elliott Bay. Four years from now, hopefully, many mega-container ships will ply Pacific Northwest waters.
The Benjamin Franklin is largest vessel ever to call at a U.S. port. It is longer than two-Space Needles stacked on top of one another; wider than a CenturyLink Field; and, rises 20 stories high. In fact, when fully loaded it barely fits under San Francisco’s Golden Gate Bridge and when empty its 18,000 containers could stretch end-to-end from Tacoma to Everett.
The size of container ships has increase dramatically. They are mega-container ships have West Coast port leaders scrambling to deepen harbors, lengthen docks, strengthen piers, install larger cranes, speed up cargo handling, and improve rail and road systems. Those improvements cost billions.
The challenge is ever-changing technology and stiffer global competitive demands which outstrip the ports’ ability to design, schedule and pay for the required infrastructure improvements.
For example, when engineers planned the Panama Canal expansion over a decade ago, they built it to accommodate ships which are two-thirds the size of Benjamin Franklin. Those 12,000 container ships fit snuggly into the new locks.
The “Triple E” class ships are too big and designed for sailing across oceans. However, their emergence has rekindled Chinese investors’ interest in building a $50 billion canal across Nicaragua.
CSM CGM, Benjamin Franklin’s owner, has five clones under construction, while competitors MSC and Maersk are building 20 each. One of MSC’s ships, the MSC Oscar, is delivered and outfitted to carry over 19,000 containers.
In the Puget Sound, arrival of those ships drove the Ports of Seattle and Tacoma to form the Northwest Seaport Alliance (NWSA). It has a 10-year strategy intended to reverse a 15-year trend in which their share of the U.S. container volume dropped from 16.5 percent to 11.6.
A key part of the plan is boost container shipments to 6 million containers by 2025. In 2014, the volume was 3.4 million. If successful, the two ports will create 48,000 jobs.
[Editor’s note: These mega ships and the response by other ports in the region are impacting the competitiveness of the Port of Portland. The Columbia River channel already is close to maxed out handling older, smaller vessels. The trend toward larger ships could have a variety of consequences for the Port of Astoria.]
According to a 2013 study, NWSA operations generated $138.1 billion for our state’s economy. If the farmers and manufacturers who ship products through the two harbors are factored in, the ports account for 443,000 jobs across the state.
While the costs of infrastructure improvements are staggering, the reward are significant. The competition is stiff and our competitor ports are spending hundreds of millions.
For example, British Columbia is investing $200 million at Prince Rupert, the deepest natural harbor in the Pacific Northwest. The port is adding a second berth to handle the longer ships. Its new cranes, high tech cargo handling and additional rail improvements increase its capacity to handle over 1.3 million containers a year. Today, it’s moving 850,000.
Time is money. Delays from labor slowdowns, over-burdensome regulations, insufficient investments or congestion around ports are deadly.
Manufacturers, shippers and ports must constantly find ways to lower costs. They also must abide by stronger environmental regulations.
Newer ships meet those needs and are built to save fuel, meet air emission standards and return water to the ocean without contaminants.
Here’s the bottom line.
The U.S. Department of Commerce calculates that a 20-foot container of apparel shipped from China to our West Coast costs at just over $4,000 and takes roughly 40 days. So, when shipping companies can add 6,000 containers, save fuel and reduce transit times, they are more competitive.
The more ships docking at our ports means greater prosperity for us all.
Don C. Brunell is a business analyst, writer and columnist. He retired as president of the Association of Washington Business, the state’s oldest and largest business organization, and now lives in Vancouver. He can be contacted at theBrunells@msn.com.