DC Velocity - November 2011

transportationreport NOVEMBER 2011 DC VELOCITY 31

BY MARK B. SOLOMON

MARITIME/PORTS

The Florida factor
The Port of Miami has fought an uphill battle to compete
with rivals for Florida-bound international sea freight. The
expanded Panama Canal may level the playing field.

BILL JOHNSON HAS GLIMPSED THE HOLY GRAIL IN HIS OWN backyard, and he is determined—come hell or deep water—to capture it.

Johnson, the hard-charging director of the Port of Miami, has spent the past five years looking into why so much of the Asian import cargo destined for Florida enters the country through ports outside the state. According to port data, only about 38 percent of Asian import traffic bound for Florida actually enters via the state’s ports. About 36 percent enters through the ports of Los Angeles and Long Beach, 13 percent through the Port of Savannah (Ga.), and the remaining 13 percent through various other U.S. ports.

In particular, Johnson has focused on why Savannah, nearly 500 miles to the north, has been such a strong competitor for trans-Pacific cargoes destined for Central and Southern Florida. There are good reasons for Savannah’s strength. Though it has a relatively shallow harbor depth of 42 feet, it remains the only East Coast seaport with on-dock rail connections to the two Eastern Class I railroads, CSX Corp. and Norfolk Southern Corp.

Savannah is also near the robust manufacturing areas of Southern Georgia and Northern Florida, where goods are shipped, usually by truck, into Florida’s Central and Southern regions for distribution to a population approaching 13 million people.

Port officials acknowledge Miami has been outflanked by Savannah in the battle for the wallets of Florida’s importers and exporters, and, by extension, the state’s consumers. Johnson, for his part, said Miami has learned a lot from Savannah and plans to use that knowledge to beat the formidable Georgia port at its own game.

“The Florida ports have lost market share to Savannah over the years, and I intend to win that business back,” he said in an interview. Port officials believe the state can recapture about one-third of the containerized traffic bound for markets within Florida but which arrives at out-of-state seaports.

A GAME-CHANGER

The catalyst for Johnson’s strategy is, not surprisingly, the opening of the expanded Panama Canal, scheduled for August 2014. The $5.2 billion project will deepen the canal by as much as 10 feet, while new lock construction will enable it to accommodate ships built to carry a maximum of 12,600 twenty-foot equivalent unit (TEU) containers, up from a current maximum of 5,100 TEUs.