Originally Published in the Journal of Commerce (JOC.com)
The Port of Wilmington, North Carolina, is accelerating various infrastructure projects that it hopes will attract larger ships and provide quicker cargo delivery for beneficial cargo owners (BCOs) looking to diversify their routing portfolio. The newest project is widening the turning basin so post-Panamax vessels can turn around in the harbor without being towed out to sea.
While the port doesn’t offer the same number of Asian services as other East Coast destinations, the Port of Wilmington aims to distinguish itself by providing faster and more consistent cargo fluidity to shippers. The North Carolina State Ports Authority sees maintaining quick truck turn times even with growing volume, allowing importers to deliver containers to North Carolina warehouses and distribution centers faster, as paramount to its mission.
According to the port authority, the average turn time in Wilmington is 19 minutes for a single transaction and 32 minutes for a dual, which is when an empty is dropped off and a loaded box is retrieved in the same trip. The turn time is measured from the ingate to the outgate, so it doesn’t take into account a queue outside the terminal. With such a low starting point, there isn’t much room to improve as much as maintain these results if volume climbs in the future.
Port authorities in Georgia, South Carolina, and Virginia report truck turns of less than an hour on average, between 40 minutes and 60 minutes. These ports measure turns slightly differently than Wilmington, however, by including time truckers spend waiting to enter the terminal. Truckers generally have a positive view of turn times in Savannah and Charleston. Conditions have also improved in Norfolk, according to fleet executives, although there are still drivers dissatisfied with the variability of turn times at the Virginia International Gateway terminal.
Six weekly container services call at Wilmington, including Zim Integrated Shipping’s Container Service Pacific (ZCP) and THE Alliance’s East Coast 2 (EC2) service. Other services operated by Crowley Maritime and Independent Container Line connect the port to Central America and Europe, respectively.
The return of the Zim in 2018 helped boost Wilmington’s container volume 37 percent year over year to 224,568 TEU. The 2018 volume, though, was still down 3.5 percent from 2015, according to PIERS, a sister product of JOC.com within IHS Markit. Comparatively, the nearby Port of Charleston saw volume increase 2.8 percent year over year to nearly 1.8 million TEU in 2018, a 14 percent increase from 2015. Savannah’s volume rose 6.8 percent to 3.4 million TEU, the largest in the Southeast, and has surged 20 percent from 2015.
Wilmington’s volume decline was primarily due to the collapse of Hanjin Shipping Co. The seventh-largest carrier in the world at the time, Hanjin was one of the port’s largest customers before it declared bankruptcy and shuttered operations in 2016.
Inland distribution network
In order to sell carriers on its terminal fluidity, not only does Wilmington need to produce quick turn times for its truckers but also provide attractive intermodal service to inland destinations.
CSX Transportation is the only Class I railroad in Wilmington to service Charlotte. Norfolk Southern Railway’s closest terminal is in Morehead City, North Carolina, about two hours away from the port. CSX will be upgrading its Wilmington to Charlotte Queen City Express Service this July, but before 2017, the port was without intermodal for nearly three decades.
“This will be a daily overnight service into Charlotte. Our CSX service now is two day, but there is BCO demand to speed this up to overnight because of the constraints on the trucking industry due to the electronic logging devices on hours of service,” said Paul Cozza, CEO of the North Carolina State Ports Authority, which operates the Charlotte Inland Terminal.
The 200-mile dray from Wilmington to Charlotte is equal to that of Charleston, but an overnight rail option from Wilmington would save BCOs one day compared with CSX’s Charleston-to-Charlotte service.
Construction will also begin next month on a scaled back version of a CSX intermodal terminal on US 301 (Wesleyan Blvd.) in Rocky Mount. The North Carolina Department of Transportation is funding about 75 percent of the nearly $160 million project, but when completed in 2020 it will offer new options to use intermodal from Wilmington to the Interstate 95 corridor.
Dredging to 47 feet in the works
Strong inland connections only go so far, though. The port authority is also investing to upgrade its harbor on the land and waterside.
The port’s harbor depth of only 42 feet at low tide, for example, has proven to be a major disadvantage, as it requires tidal restrictions on larger vessels at a time when ship sizes are increasing rapidly. There are plans to dredge to 47 feet, but those plans are still in the early stages because a feasibility study hasn’t been completed yet.
In order to proceed, the port would need the Army Corps of Engineers to include the project in its Chief of Engineers annual report, then get authorization from Congress in a future Water Resources Development Act (WRDA) bill. As such, there is currently no timetable on when this project would even begin or even a dollar figure estimate on cost yet.
Cozza told JOC.com that he doesn’t believe tidal restrictions will be necessary at 47 feet, even though the general recommendation to handle a post-Panamax container ship is 50 feet based on vessel drafts. Without enough draft, a post-Panamax vessel could scrape the bottom of the harbor and damage its hull.
Other projects are underway and will cost about $200 million to implement, including widening the turning basin, rehabilitating the berth, and moving power lines that create an air draft restriction similar to those previously in New York and New Jersey that necessitated the raising of the Bayonne Bridge.
Widening the turning basin
Encouragingly, after a long battle between economic and environmental concerns, the port authority received permission last month to widen its turning basin to 1,524 feet. The North Carolina Division of Coastal Management originally denied a petition to excavate more than 19 acres of wetland to accomplish this goal because of environmental concerns. After the port agreed to certain conditions, including delaying construction until July 1, the North Carolina Coastal Resources Commission overruled the denial and issued a variance request necessary to do the work.
“The widening should be completed by the end of this and allow the new vessels that are 1,200 feet to use our basin,” Cozza said.
There is already two-way traffic in the channel, so the project is more about turning vessels around as needed within the inner harbor.
Cranes and berths being upgraded
Last month, the port authority received a third post-Panamax crane, bringing the total to eight cranes. It’s also renovating the berths to handle two 14,000-TEU vessels simultaneously one day, although currently 12,000 TEU is the upper limit due to the electrical wiring limiting the height of vessels coming through.
“These upgrades give us the capacity to address the needs of some of our BCOs worried about port congestion in other locations,” Cozza said. “Our mantra is to be fluid, [with] short turn times, and a high level of service.”