South Carolina extends commitment to ably handling large containerships

When it comes to container vessels, South Carolina Ports Authority leaders aren’t shy about stating that bigger is better, and they are steadfastly committed to providing infrastructure to efficiently accommodate the increasingly large boxships of today and tomorrow.

With plans advancing for a 52-foot-deep harbor, super-post-Panamax cranes being added at the Port of Charleston’s longtime busiest box-handling facility and construction under way on a new nearly 300-acre container terminal, SCPA is carrying out an assertive multipronged approach. At the helm is Jim Newsome, the former ocean carrier executive who is entering his eighth year as SCPA president and chief executive officer.  “It’s been our thesis from the start – certainly when I joined the port – that this would be a big-ship industry,” the former Hapag-Lloyd (America) Inc. president told the American Journal of Transportation. “We could read the tealeaves of what was being built and when,” Newsome continued, explaining that vessels with ability to carry a significantly number of 20-foot-equivalent container units could be expected to call the Port of Charleston.  “Certainly, when we saw 18,000- to 20,000-TEU ships being built, we realized that the 14,000-TEU ships would have to go somewhere, and,” he said, “we thought there was a fair bet they would need to come to the East Coast of the United States. “We really have spent the past five or six years preparing for that,” Newsome added. “The mega-alliances are really a logical way to deploy big containerships.”

This year, 16 of the 25 containership services that call Charleston deploy ships with capacities of 8,000 TEUs or more, larger than could pass through the Panama Canal prior to its just-completed expansion, Newsome noted, observing, “The trend is pretty dramatic. We see the trend continuing.” In this era of mega-alliances, the Port of Charleston looks to a future of fewer services and bigger ships, about which Newsome commented, “We like that, honestly. We’re probably one of the ports that prefer bigger ships to smaller ships, actually. We think it makes us more efficient.” With a slowing global economy, some major U.S. ports saw containerized cargo volumes decline over the past year, but SCPA realized a modest gain, handling 1.9 million TEUs in its fiscal year ended June 30, 2016, up 1.4 percent from the preceding 12-month period. Commodities leading the way include refrigerated and frozen cargos such as poultry and pork, with support from private sector investments in near-port cold storage and freezer space. As greater year-over-year gains are seen on the horizon, SCPA officials are focused on a number of efforts to ensure capability to competently handle growing container volumes. At the Port of Charleston’s venerable Wando Welch Terminal, which dates back to 1982 and remains the port’s busiest container facility, a wharf refurbishment project is halfway toward slated completion by the end of 2017. A $10.8 million federal Transportation Investment Generating Economic Recovery grant is covering part of the $85 million cost. The wharf endeavor is timed to coincide with arrival of the Wando Welch Terminal’s third and fourth 155-foot-high container cranes, as recently approved by the SCPA board. The terminal’s first two such super-post-Panamax gantries were delivered in August.

With plans to raise four existing cranes on the wharf to 155-foot height, eight of the 12 units at the terminal are to be that tall, so the facility should be able to simultaneously serve two 14,000-TEU ships along a 3,700-foot-long berthing area. Meanwhile, SCPA began implementation in late June of an advanced truck gate system at the Wando Welch Terminal, facilitating faster, safer processing of some 5,000 transactions in a typical day. This new system will be “really pivotal to our future growth,” according to Newsome. Gate hours also have been extended. “Everything is happening in good timing I would say,” Newsome said. Timing also is critical to the Port of Charleston and its users benefitting from new terminal development and a deeper harbor. The Hugh K. Leatherman Sr. Terminal – named for a South Carolina state senator since 1981 and the body’s current president pro tempore – is being built on a former U.S. Navy base site along the Cooper River in North Charleston. 

The Leatherman Terminal, with a total price tag of $1.3 billion, is the only new permitted container terminal project on the U.S. East and Gulf coasts and, at full build-out, slated for 2030, it is anticipated to boost the Port of Charleston’s overall container-handling capacity by 50 percent. “It will really be a significant addition in terms of berth capacity and marshaling capacity in our port,” Newsome said. Operations are expected to begin by the end of 2019 on the $800 million, 171-acre first phase of the new terminal. The Leatherman Terminal’s development is tied to the effort to bring the Charleston harbor to a depth of 52 feet by the end of this decade, leading Newsome to comment, “The one has to happen for the other to be effective.” The harbor undertaking is the first deepening project to be advanced under the U.S. Army Corps of Engineers’ USACE’s Specific, Measurable, Attainable, Risk-Informed, Timely, or SMART, planning process.  The deepening feasibility study – swiftly completed in fewer than four years and for $11 million, far less than the projected $20 million – has been transmitted to Congress, where the Charleston plan is one of three harbor projects teed up for authorization in the Water Resources Development Act of 2016, along with those at South Florida’s Port Everglades and Brownsville, Texas. Thanks to $300 million foresightedly set aside in 2012 by the South Carolina General Assembly, the 60 percent local sponsor portion of the harbor project’s cost already is in place. Indeed, being able to handle larger containerships doesn’t come cheap. “I would say the minimum ticket to be a Top 10 port, you’ve got to invest close to $1 billion in the next five years if you want to be in this big-ship, big-containerport game,” Newsome said. SCPA is investing $1 billion over the next five years, while the State of South Carolina is chipping in close to $800 million, according to Newsome, who pointed out that the expenditures are well-justified as port facilities represent a crucial piece – to the tune of $53 billion in annual statewide impact – in the Palmetto State’s economic development. The South Carolina economy is expected to grow between 3.5 percent and 4 percent this year, about twice the growth rate for the U.S. economy as a whole. At the Port of Charleston, growth is by no means limited to the container sector. In the fiscal year ended June 30, the Port of Charleston’s Columbus Street Terminal achieved a record finished vehicle volume. With BMW at the fore, a total of 274,426 vehicles crossed SCPA docks last fiscal year, up 8 percent over the preceding 12-month span. The Columbus Street Terminal also is a center of activity for imports and exports of power generation project cargos, with customers including General Electric, Siemens AG and Westinghouse Electric Corp. Little wonder Patrick W. McKinney, chairman of the SCPA’s board, is enthusiastic about the owner-operator port authority’s present and future. “Our port has made significant progress on key projects this fiscal year, including harbor deepening, Leatherman Terminal construction and the Wando Terminal wharf project,” McKinney said as fiscal 2016 results were announced. “We are well-positioned to meet the changing needs of our industry and remain focused on increasing growth while completing the necessary improvements to our facilities and infrastructure to be competitive into the future.”