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Thursday, January 26, 2012

Port of Oakland Records Modest Year-Over-Year Growth

The Port of Oakland saw a total volume growth of 0.5 percent in 2011 compared with the year before, driven mostly by a huge leap in imports of empty shipping containers.

According to the port’s full-year statistics for 2011, a total of 264,471 empty TEUs were imported through Oakland in 2011, a whopping 26 percent increase from the year prior. Oakland also saw a modest increase in full exports, as 993,926 were moved last year, a jump of four percent from 2010.

According to the data, the port moved a grand total of 2.34 million twenty-foot equivalent units during the 12-month period, a slight bump up from the 2.33 million shipped in 2010.

The news wasn’t all good however, as there were negative trends in both the number of full containers imported during the year, and empty ones exported.

Full imports fell by 0.7 percent for the year to 797,228 TEUs, while the number of empty containers exported dropped by nearly 21 percent, to 286,879 TEUs.

Specifically for the month of December, imports and exports were up in three of four activity categories compared with the same month the year before.

Imports of empties were up 8.4 percent to 19,864 for the month, while exports of empties also rose, to 22,305, a 6.9 percent gain. Full exports were up by a modest 1.8 percent to 84,585 for the month.

The lone decline came in full imports, which were recorded at 63,246 for the month, a 3.7 percent drop from the same month in 2010.

Despite the year-over-year declines in the full import and empty export categories, 2011 on the whole was the second consecutive year of total volume gains at Oakland, after three straight years of declines.

In 2010, total volume rose 13.9 percent after a three-year period during which the yearly numbers were negative by 0.2 percent, 6.5 percent and 8.4 percent in 2007, 2008 and 2009, respectively.

Oakland is the third-largest container seaport on the North American West Coast, after the ports of Los Angeles and Long Beach.

TEU, Tonnage Numbers Jump at Port of Portland

For the second straight year, the Port of Portland handled the third-most tonnage in its history, as 2011 totals improved upon results for 2010. Year-end reports show a two percent increase, with 13.37 million tons handled compared to 13.12 million the year before.

Growth was driven primarily by container volumes, which improved by nine percent, going from 181,100 twenty-foot equivalent units in 2010 to 197,446 TEUs last year.
Full export containers grew by 27 percent, representing a jump in demand for regional products heading overseas.

The growth is partially accounted for by the February 2011 start of a 25-year lease of the port’s container terminal to ICTSI Oregon, which over the course of the year also helped full container imports improve by five percent to 92,785 for the year.

Aside from containers however, most other cargo categories stayed flat or showed minor declines in 2011.

Grain remained essentially unchanged at 4.7 million tons. Mineral bulks – primarily potash used in fertilizer and soda ash used in glass production – dropped by half of a percent, to 5.2 million tons.

Break bulk, mostly steel slab and steel rail, dipped 2.6 percent for the year to 941,120 tons.

Auto imports also lagged; the 234,048 vehicles handled by Portland in 2011 was an 11.5 percent year-over-year decrease. The port attributes the decline to multiple global factors, including effects of the earthquakes and tsunami in Japan and recent flooding in Thailand.

The disruptions to auto parts suppliers caused domino effects throughout the supply chain at factories, ports and dealerships.

The downward trend could turn around this year however, as Portland recently began exporting Ford vehicles to South Korea for the first time and Subaru has finished construction on a 413,000-square-foot facility in the port’s Rivergate Industrial District that includes auto parts distribution, a service training center and regional offices.

Union Pacific Reports Record 4th Quarter, Year

Union Pacific Railroad is reporting a net income of $3.3 billion for calendar year 2011, an 18 percent increase over the $2.8 billion income of 2010.

The company says its operating revenue totaled a record $19.6 billion last year versus $17.0 billion in 2010, and that operating income increased 15 percent to $5.7 billion, up from $5 billion the year prior.

“2011 was the most profitable year in Union Pacific’s history,” UP chairman and CEO Jim Young said in a statement announcing the numbers. “In 2011, we achieved best-ever marks in customer satisfaction and employee safety, invested a record $3.2 billion in capital and generated record free cash flow of $1.9 billion.”

The company’s fourth quarter net income last year was a reported $964 million, compared to $775 million in the same quarter of 2010. During the quarter, total revenue carloads, grew three percent over 2010, according to the company.

“The dedicated efforts of our employees, combined with the strength of our diverse railroad franchise, drove record fourth quarter results,” Young said.

Looking ahead, the company says it expects slow, but steady economic growth in 2012. It has already revealed plans to spend a record $3.6 billion this year to replace aging equipment, strengthen infrastructure to improve productivity and safety, and meet expected volume growth.

“The diversity of our unique railroad franchise will continue to provide growth opportunities in various markets,” Young said.

UP, which was incorporated in July 1862 and celebrates its 150th anniversary this year, operates routes from all major West Coast ports to the East and Gulf coasts.

Port of San Diego Begins Bay Tour Facility Construction

Construction begins this week on two new bay tour facilities at the Port of San Diego.

Two port tenants, Flagship Cruises & Events and Hornblower Cruises & Events, are relocating to new facilities, primarily to minimize conflicts with cruise ship operations.

Waterside improvements for both bay tour operators are anticipated to be completed in April, according to the port, with utility improvements to be completed in June.

Landside improvements, including new ticket kiosks and a sundries kiosk, are expected to be completed in 2013.

Flagship Cruises & Events, which currently operates at 1050 North Harbor Drive, is developing a new facility at 900 North Harbor Drive that’s expected to have 8,000 square feet of floats and gangways, as well as shoreside power, allowing the company’s fleet to plug into clean electricity.

At the same time, Hornblower Cruises and Events, now at 1066 North Harbor Drive, is building a gangway and dock along 400 feet of Navy Pier, located at 910 North Harbor Drive, to service bay tours, whale watching and public dining cruises.

Hornblower is also adding about 6,000 square feet of floating docks adjacent to the Grape Street Pier 3, located off of the foot of Grape Street and North Harbor Drive.

Construction fencing for the project is expected to be put up between Navy Pier and Broadway Pier on Jan. 27, according to the port.

Tuesday, January 24, 2012

EGT, ILWU Reach Tentative Labor Agreement

After being brought together by Gov. Christine Gregoire to find common ground, export grain terminal operator EGT and the International Longshore and Warehouse Union have reached a tentative agreement that ends a months-long, sometimes violent labor dispute at the Port of Longview.

Neither the company nor the union has thus far revealed the details of the settlement, but each side confirmed in a Jan. 23 announcement that negotiations have been productive.

“The ILWU and EGT have reached a tentative settlement to resolve the pending legal matters between the parties and the Port of Longview,” EGT CEO Larry Clarke said in the statement, which was released by Gregoire's office. “While the parties are still working to finalize certain conditions over the next several days, we are optimistic we can resolve the dispute and get on with the business of operating the facility,” Clarke said.

Longview’s EGT terminal is a $200 million joint venture between Bunge Ltd, ITOCHU International and STX Pan Ocean.

The dispute stemmed from company using the services of a union other than the ILWU at the terminal. Members of union Local 21 had contended that its contract with the Port of Longview required that the 25 to 35 jobs inside the terminal go to ILWU labor. The company, however, said its lease agreement with the port does not specify ILWU workers.

ILWU members and supporters picketed the facility throughout last summer over the issues, and a federal trial on the dispute was scheduled to begin in March.

Earlier this month, the union announced plans to picket the first incoming grain ship, due in late January. But that protest, like the federal trial, has apparently been called off, or at least put on hold.

During the previous pickets, protesters had stormed the facility, cut brake lines on rail cars and dumped grain from the cars, among other things, which led to dozens of arrests on trespassing and disorderly conduct charges.

The first two criminal cases led to not-guilty verdicts in jury trials, and prosecutors later dropped the criminal charges against numerous other arrestees. Dozens of other cases are still pending in the criminal justice system, but many, if not most, could be dismissed.

“This is a win for the ILWU, EGT, and the Longview community,” ILWU President Robert McEllrath said of the agreement. “The ILWU has eight decades of grain export experience in the Northwest, and we look forward to the opportunity to develop a positive working relationship with EGT.”

It’s currently unclear how the agreement would affect Operating Engineers Local 701, the union whose members had been working at the terminal.

New POLB Executive Director Outlines His Vision

The Port of Long Beach needs to be bold in bringing in more trade, jobs, business and revenue, according to new executive director J. Christopher Lytle.

“To keep generating jobs and economic activity here in Long Beach, we have to stay ahead of our competition,” he said during his first-ever State of the Port address, given Jan. 19 at the Long Beach Convention Center. “We must continue to make major investments in our facilities.”

Lytle, who was named the successor to outgoing executive director Dick Steinke last November, said the port projects that it will move 6.3 million containers in 2012, up slightly from the 6.1 million that traveled through the port last year. He also covered many other issues during the wide-ranging address, including the expected emergence of new competition for cargo.

“With the coming of the Panama Canal in 2014, the battle for our business and our jobs will only grow,” he said. “Once bigger ships can sail through the Panama Canal, the Gulf and East Coast ports will try to grab a greater slice of the pie.”
The answer for Long Beach, he said, is to be ready with deep waterways, efficient cargo-handling terminals, high-capacity rail connections and state-of-the-art security, among other things.

And to that point, he touted the port’s Middle Harbor project, which, by the time it’s finished in 2019, is expected to double its previous capacity and move about 3.1 million containers, while reducing the amount of pollution the terminal generates by half.

The port has finalized negotiations on a 40-year, $4.6 billion lease on the terminal with Orient Overseas Container Line and its affiliate, Long Beach Container Terminal.

“It’s by far the biggest project in North America,” Lytle said.

Among the other highlights of the speech:
•    As of Jan. 1, all 11,000 drayage trucks serving the Port of Long Beach are newer, cleaner models, thanks to the port’s Clean Trucks Program. The program has cut truck pollution by 90 percent, Lytle said.
•    All the port’s major terminals are expected to have shore power capabilities by 2014.
•    Since the 9/11 terrorist attacks, the port has increased its security staff by 40 percent and invested tens of millions of dollars on equipment and training. More than 130 surveillance cameras now operate throughout the port complex, Lytle said.
•    About $5 million in grants earmarked for reducing greenhouse gasses are slated to be issued out to community groups and other stakeholders.

Port of Tacoma Projects 2012 Revenue Increase

The Port of Tacoma’s overall operating budget for 2012 includes projected revenue of $116.3 million, an increase of 3.3 percent over the estimated 2011 operating revenue results.

The revenue increase, according to the port, is driven primarily by improved intermodal lift volumes, contractual increases and minimum payments from container terminal customers, as well as from new leases from property acquisitions made over the past several years.

The port’s 2012 operating income is budgeted at $20.8 million, down from the forecast $22.3 million in 2011. However, net income is projected at $28.6 million, an increase of almost $2 million from last year’s forecast of $26.8 million.

The budget also includes projected volume changes, including:
•    A total tonnage increase of 2.9 percent, from 16.5 million to 17.0 million short tons.
•    A 2.9 percent increase in total 20-foot equivalent container units.
•    An 8.9 percent increase in intermodal lifts.   

“The Port of Tacoma will encounter both market risks and new business opportunities in 2012,” CEO John Wolfe said in announcing the budget. He says Tacoma could pivot strategically once an in-progress analysis is complete by the end of the first quarter.

“The port is in the process of a strategic review that will direct the investments we make in the future and the business models under which we operate,” he said. “Therefore, 2012 will be a year of transition as we implement our new strategies.”

Wolfe also warned that the economic storm that plagued Tacoma in recent years still hasn’t completely blown over.

“We fully expect that the lingering effects of the recent global economic downturn will continue through 2012,” he said. “While we see encouraging signs of recovery and cautious optimism, we believe full recovery is still years away.”

Longshoreman Killed at Cosco Terminal

A longshoreman working at the Port of Long Beach’s Cosco Terminal was crushed by a falling cargo container just before 7 pm Jan. 20, according to police.

Authorities say that Steven Saggiani, 47, of Long Beach, was working loading and unloading containers on the deck of an unidentified ship at Pier J when an eight-ton, 40-foot container fell 200 feet and crushed him.

He was pronounced dead at the scene.

Patricia Ortiz, a spokeswoman with the California Occupational Safety and Health Program, commonly known as Cal-OSHA, told the Long Beach Press-Telegram, that Saggiani was working as the ship’s boss when one of the containers twisted, fell off a stack, then struck Saggiani as he and other workers fled.

Because Saggiani was on the ship and the crane was on the dock, the incident is being investigated by both Cal-OSHA and its federal equivalent, Ortiz told the newspaper.

An investigation could take anywhere from two to six months, Ortiz said.