Volumes up for break bulk at SCPA

Break bulk is up at South Carolina Ports Authority (SCPA). Figures for the Port of Charleston’s break bulk activity for FY 2014 totaled 763,230 pier tons, which was 3.63 percent over plan. In fact, SCPA increased non-containerized cargo 62 percent in the last three years, and doubled non-container cargo in the last four.

Break bulk for SCPA encompasses two components: roll-on roll-off (ro-ro) cargo, which is heavily centered on BMW exports, and project cargo. Driving these increases is project cargo—high wide and heavy cargo coming inbound and outbound for the power generation industry. “Houston has its oil and gas. Here we handle a lot of power generation equipment,” commented Brad Stroble, SCPA manager for non-containerized sales. “The likes of Siemens, GE, and Westinghouse are clients of ours.” Some of the more recent project cargo at the Port of Charleston is Westinghouse nuclear power plant parts, and General Electric and Siemens gas turbines. “These are what I would call high end manufactured break bulk cargo,” he said. “We refurnished our Columbus Street terminal about four years ago to handle the growth in that segment. That has really paid off.” Automotive is also big at SCPA. SCPA’s major client is BMW, which manufacturers all of its X models and SUVs in South Carolina for export. “We also do a lot of rolling stock, such as agriculture, structural equipment,” he added. Other general cargos are steel and non ferrous metals generated by what Stroble calls a manufacturing renaissance that is going on in South Carolina currently. A lot of the steel is driven by tire manufacturing in South Carolina. For example, imported steel is turned into tire cores and tire beads. “There will be other ripple effects of cargo as a result of the materials—particularly raw and synthetic rubber,” Stroble added. “That is not moving yet in break bulk, but it will soon. Tires drive a lot of our steel business with the natural rubber being the next cargo.” Among the tire companies operating in South Carolina are Michelin, Continental, Firestone, and Bridgestone. Giving the industry a huge boost is the fact others are on their way. For example, Giti Tire of Singapore, the tenth largest tire company in the world, committed in June to building a $560 million manufacturing facility in Chester County, SC – its first in North America. Giti Tire plans to produce both passenger and light truck tires for the Original Equipment Manufacturer (OEM) and replacement markets. The new facility, which will be located in the Carolinas I-77 Mega Site, will combine manufacturing and distribution activities, with total building area estimated to be 1.8 million square feet. During the first phase of production, the plant’s capacity is expected to be five million tires annually. Giti Tire plans to further increase production capacity in response to future market demand and conditions. The company’s decision to locate in South Carolina was driven by a number of factors that included proximity to major transportation infrastructure and deep-water port facilities in Charleston. “Chester County is an excellent location for Giti Tire, offering extensive and efficient infrastructure network including interstate highways, rail, close proximity to airports and a major metropolitan area to support the company’s needs and growth for many years to come,” said Lei Huai Chin, managing director of Giti Tire Group, in a corporate press release. Stroble sees other manufacturers following. This will add further break bulk volumes and business at the port. “That’s the ultimate goal on the break bulk side,” Stroble said. “First we see structure steel coming in. They erect plants. We bring in all of the machinery and project cargo. Then we deliver all the raw materials. Then the grand slam is these companies either export it as break bulk or products moved in containers.” Infrastructure Attributes Driving much of the sophisticated break bulk shipments that traverse the Port of Charleston and the corridors it serves are inland bridge clearances out of Charleston for both truck and rail. “You can have the best clearances in the port, but if you have a low bridge on the way out then your cargo will be stopped. This is a huge selling point,” Stroble said. Another major factor is the Port of Charleston is dual served by two Class I railroads: CSX and Norfolk Southern (NS). “Not all ports have dual service,” he remarked. A port may have dual service to its container terminal, but not necessarily the break bulk terminal. The Port of Charleston has dual service to all break bulk terminals.” The Port of Charleston has made huge investments in its break bulk facilities. Most noteworthy the $30 million to transform the Columbus Street Terminal into a state-of-the-art project and specialized break bulk and ro-ro facility. This year the port also introduced its heavy lift floating barge crane with its 500 ton capacity. Called the “Ocean Ranger”, the crane is mounted on a 200-foot by 72-foot ABS deck barge so that it has the ability to work all terminals in the Port of Charleston. “This makes it very flexible to handle a wide variety of projects,” Stroble said. “Because of its flexibility, we can move with it.” The barge has the ability to handle 95 percent of all of the project cargo manufactured in the world. Also important, the Port of Charleston offers full dock rail. “The rail actually runs alongside the vessel berth, which allows us to take export shipments directly from rail car to onboard the ship. This reduces risk, limits handling, and reduces cost. Not many ports offer this. Other pluses to the port are its multimodal marine community, stevedores, heavy haulers, and riggers. “They all know how to handle this cargo,” he stated. “It’s a team port.” “When we laid out the new facility to revamp Columbus Street with this cargo in mind, we separated our rail tracks so that one is for the heavy lift trade and the other is for automotive,” Stroble explained. “We don’t have to worry about working the rail cars with automobiles first then giving service to the project guys. This is a big deal. These are not 60 foot box cars or standard bulkhead flat cars. These are specialized cars.” Road access is just as important to the trucking side as rail. Here Stroble comments that great effort is given to accommodate heavy lift, project cargo shipments. “There’s some restrictions as far as permitting is concerned,” he explained. “They give certain windows of times when these shipments can be on the roads.” Another plus are the three major interstates close to the terminal: I-95, I-526 and I-26. I-526 and I-26 are accessible within a few miles of the terminal. “This allows us to overcome some geographic disadvantages,” Stroble said. “In other words, perhaps a project is at a geographic disadvantage from a mileage stand point from the Port of Charleston. But unlike other ports through which the cargo could be handled, we offer the clearance – especially over swamp land.” The port handles shipments for destinations inland. “For GE exports, the distances are short – only Greenville to Charleston,” he said. “But many of the inland shipments go all over.” This makes the port highly competitive with neighboring seaports. Markets Much of the imported steel coming into the Port of Charleston comes from China, Turkey, India and especially Brazil. “We’ve seen a slowdown in steel coming from China since it was just slapped for antidumping,” he said. “But that just means it turns up the imports from Turkey.” The port exports shipments for large power projects all over world. Today, many shipments are being made for a large project in Algeria. Interesting, ever since the earthquake and tsunami devastated the Fukushima nuclear power plant in Japan, nuclear power plant components that are manufactured in Asia are being exported to Charleston for US nuclear power plants rather than nuclear power plants in Asia. “We are seeing a lot of components for natural gas plants being exported from Charleston to Asia,” he said. Besides North Africa and Asia, however, the port is also exporting these components to the Caribbean and South America. “Any where that is densely populated or the population is growing at fast pace is a good candidate,” he said. Steel from South America arrives regularly on liner services. Ships carrying project cargo that has a start and a finish date will come in “hot in heavy for a while.” In fact, one day in August the port had four such specialized ships in port simultaneously. Among the lines carrying project cargo at the port are BBC, Rickmers-Linie, and Inter Marine Line, among others. Unlike steamship lines that haul containerized cargo, project carriers are smaller ships. “They cannot dump so much stuff at a construction site at one time,” Stroble explained. “They normally will take one to two heavy pieces, ancillary freight around and do scheduled deliveries.” In addition, the ships are not that deep and, therefore, do not need 50 foot water or worry about transiting the Panama Canal. Unique Qualities What makes the Port of Charleston’s break bulk business unique? “The truth is, it starts with the foundation, our capabilities, the state, the port, and the maritime community is heavily invested in the break bulk business,” commented Stroble. Also important is the state’s efforts and ability to attract manufactures. “Right now we have capabilities that our competitors don’t have,” he said. Another particular note: break bulk has become very sophisticated cargo. “Since it doesn’t fit into a box, it is still very labor intense and employs a lot of people all the way down the chain.”