In a down market it’s great to be able to announce any new business at all.  It is tremendous to be able to announce a lot of new business, some of which you stole from a competitor!  That’s exactly what the Port of Virginia did today when they announced that China Shipping and two new CKYH alliance services will begin calling on Norfolk International Terminals in the next few months.  

The most exciting news comes is that one of the CKYH services, the NATCO-4, will have Norfolk as its first stop from Asia.  This means that customers shipping goods via this services will be able to receive their containers via Virginia before other ports.  First Call services are a big deal for ports and Virginia hopes that they can leverage the NATCO-4 success into more First Call services.  The full port rotation for the NATCO-4 service is Shanghai, Chiwan, Yantian, Hong Kong, Virginia and New York and will utilize eight vessels each with a 3,850 TEU capacity.  With the change in the service, CKYH dropped Savannah from the NATCO-4 rotation.

Virginia is also being added to the NATCO-5 service.  The full port rotation for that service is Pusan, Shanghai, Ningbo, Yantian, Xiamen, Savannah, Virginia and New York and will utilize eight vessels each with a 3,300 TEU capacity.

Finally, after bypassing Virginia over one year ago, China Shipping is adding Virginia back into their weekly AAE-1 service.  The full port rotation for the AAE-1 service will be Shanghai, Hong Kong, Yantian, Miami, Savannah, Virginia and New York.  This service will use smaller vessels, each of which are approximately 3,000 TEUs.

All told, the new services represent about 150 new ship calls to the Port of Virginia.  That’s great news in any economic environment.

Earlier this week, the Port of Savannah took delivery of 4 new, super post-Panamax cranes.  These container cranes are some of the largest in the world and can handle ships that carry up to 22 rows of containers on their decks.  In addition to being huge, the cranes are environmentally friendly.  To begin with, they are electric not diesel.  In addition, they generate a significant portion of their electrical requirements internally, utilizing the pull of gravity to spin up generators.  Overall, this is another good move by Savannah to prepare themselves to accommodate the future big ships and an important step to protect the environment.  

The Jacksonville Business Journal reported yesterday that Mitsui estimates the final bill for the necessary channel dredging at JaxPort could reach $1 billion.  Dennis Kelly, general manager at the Mitsui Jacksonville terminal, said the St. Johns River dredging is necessary to accommodate the newer, larger container ships.  This need becomes even more critical in 2014 when the newly widened Panama Canal opens, allowing those larger ships to transit.  Although Jacksonville will compete with Savannah for the dredging funds, the new nuclear aircraft carrier base at Mayport will strengthen its argument.  

In an economy where we hear on a daily basis about hundreds of billions, or even trillion’s, of dollars being handed out by the government, it is easy to be lulled into thinking that a $1 billion dredging project is small.  This is still a huge undertaking for the Corps of Engineers and these funds won’t come without a significant struggle.  However, a 50′ channel depth seems to be the magic number and if you have it you have a significant competitive advantage.  When the big ships come there will only be a few mega-ports on the east coast that these ships will call on.  Jacksonville’s ability to obtain these funds will go a long way in helping to determine whether it can become one of these “winners”.

The engineering firm of Moffat & Nichol said it could be 15 years before it made sense to construct the new port in Jasper County, SC.   In their recent report, the company cited slowing demand and increasing capacities at existing facilities as reasons for the delays.  In addition, M&N estimated that the permitting phase could take in excess of 12 years.

The Jasper Port, which would be operated by a joint Georgia and South Carolina port authority is in a unique position.  Lawmakers want the port up and operational as soon as possible.  They believe that it will be a huge economic driver for the region.  With the slowing in consumer spending and the resultant reduction in TEU volume, the individual states are concerned about cannibalizing business from Charleston and Savannah ports (both of which are increasing capacities).  Although, with a 12 year permitting process, demand will have certainly picked up by 2020.

Even with negotiations still underway to retain Maersk as a customer at the Port of Charleston, the shipping line announced that it will reroute some of its cargo away from Charleston.  Under a vessel-sharing agreement with CMA-CGM, Maersk will eliminate one weekly service call from Charleston and add that cargo to rival ports of Savannah and Virginia.  The loss is another major blow to Charleston in what is becoming a painful saga.  This latest move is a clear indication that Maersk is serious about leaving the Port of Charleston when its contract expires in 2010.

While the loss of Maersk will be difficult for the Port of Charleston to handle, I am afraid that it may be just the beginning.  When the largest shipping line in the world publicly announces that it can’t operate in your port because it is too expense relative to the competition, few other shipping lines will be beating down your door to sign up.  Where the big boys go, so goes the little guy.