“All ocean regions are at normal operations and should remain so throughout the remainder of the year,” reports ITS Logistics in its latest U.S. Port/Rail Ramp Freight Index. Also, private investment of up to $300 million will go toward upgrading and expanding the Howland Hook Marine Terminal at the Port Authority of New York and New Jersey (PANY/NJ).
ITS Logistics on Sept. 12 issued its September index on port container and dray operations for the Pacific, Atlantic and Gulf regions and on ocean and domestic container rail ramp operations for the West Inland and East Inland regions (see above). The 3PL (third-party logistics) firm based in Reno, Nev., reported that ocean terminal operations have returned to normal and that “Chicago-area drayage providers with chassis win the day.”
“Port terminal operations continue to run without any major congestion or equipment shortages,” said Paul Brashier, Vice President of Drayage and Intermodal for ITS Logistics, which offers drayage and intermodal services in 22 coastal ports and 30 inland rail ramps.
According to the 3PL, the Atlantic and Gulf hurricane season is being forecasted by the National Oceanic and Atmospheric Administration (NOAA) to be above normal due to elevated water temperatures. It noted, however, that the direct landfall of these storms around ocean terminals and ramps “is not a major concern.” It added that the Panama Canal has been experiencing low water levels and restrictions on vessels, but containerized cargo is not being affected.
“It should also be noted that both Seattle and Tacoma [Wash.] are receiving additional volumes that were originally destined for British Columbia while shippers continue to avoid any disruptions due to the aftermath of the West Coast Canada labor activity experienced this summer,” Brashier reported.
While the Seattle and Tacoma port terminals “have plenty of capacity to effectively manage and process any received volume, there is a concern that limited rail provider equipment and capacity may cause delays in transit for IPI freight,” according to ITS Logistics. Chicago-area ramps, it added, “are still struggling to process freight that was delayed” due to the West Coast Canada strike.
“Both congestion and equipment challenges are reducing driver productivity and the number of containers a driver can pull in a day,” Brashier reported. “This has resulted in an increased cost to truckers.”
The PANY/NJ on Sept. 12 reported that a projected investment of $200 million to $300 million will be used to expand and upgrade the Howland Hook Marine Terminal on Staten Island. The funding, it said, was secured through an amended lease agreement between PANY/NJ and the facility’s new operator, global shipping and logistics company CMA CGM, which assumed operational control of the terminal following its acquisition of Global Container Terminals’s U.S. assets in New York and New Jersey on Aug. 31, 2023. (CMA CGM had signed a binding purchase agreement in December 2022.) The lease now runs through 2047.
Under the amended agreement, CMA CGM will pay increased rent based on container throughput, subject to a minimum annual guarantee, and will share revenue from excess container storage, PANY/NJ said. It will also assume full responsibility for maintaining and rebuilding wharf and berth structures, as well as increasing capacity to meet demand.
The new investment will go toward reconstruction and rehabilitation of wharves and ship berths, as well as upgrades to cargo handling equipment and expansion of yard capacity. CMA CGM has committed to boosting the facility’s capacity by 50% over the next seven years, allowing it to handle up to 750,000 cargo lifts each year, according to PANY/NJ.
CMA CGM has also committed to the PANY/NJ’s goal of achieving net-zero greenhouse gas emissions by 2050, including upgrading to zero-emissions material handling equipment and promoting renewable energy throughout the facility, and will collaborate around priorities such as safety and security, innovation, customer experience, key performance standards, and enhanced reporting on terminal activities, according to PANY/NJ.
“Business is booming at the Port of New York and New Jersey, and this amended lease agreement at our Staten Island terminal will ensure that this area and the community reap the benefits of an energetic and fully mobilized port facility,” PANY/NJ Chairman Kevin O’Toole said. “A renovated, reenergized Howland Hook means more capacity, more activity, and more economic growth for the region.”
“We are very pleased to reach this agreement with the state of New York and the Port Authority, which will help further advance the region’s standing as a critical entry point for goods bound for the Eastern and Midwestern United States,” said Peter Levesque, President and CEO of CMA CGM Americas LLC. “By investing in this critical infrastructure and delivering on our mission to provide the best transportation solutions available, CMA CGM will give U.S. companies the opportunity to assume greater control over their supply chains and provide additional end-to-end solutions to their customers.”