December to Remember

by Kenny Macdonald 1/29/2016 12:13 PM

As the wettest December since 1933 hammered the Portland area with more than 15 inches of rain, much of the media coverage focused on issues like landslides, washouts and flooding on roads and highways. How did the Port of Portland’s marine terminals handle the deluge? Overall very well.

Facilities

Although the rains seemed like they would never let up in December, the Willamette and Columbia rivers only reached a high of 11 feet over the Columbia River’s baseline. That’s about five feet above average for the time of year but four below flood stage and well shy of the 30-foot Vanport Flood in 1948. Piers, floating docks and other infrastructure built on the river are designed to handle heavy river flows and high water events.

When the Port designs or redevelops marine terminals now, stormwater management is a primary consideration. The Port recently developed to stormwater management plans for each terminal that guides design and decision-making. However, problems do emerge with older infrastructure, says Susan Aha, a Port water resources manager. “One of the challenges faced by the Port is that existing marine terminals have been developed over many decades. In some cases, parts of management systems can be quite old.” 

In early 2015, a small sinkhole formed at Terminal 4. The culprit, now on display at the T-4 offices, was a collapsed pipe made of wood wrapped in wire and estimated to be 90 years old. 

Operations

Loading and unloading autos went unabated despite the wet weather, with 11 car carriers visiting Port facilities during December. However, weather hampered operations at bulk terminals as hard rain events require loading to stop and ship holds to be covered, a decision made by the ship’s captain or chief officer.

“Typically, lighter showers do not cause significant delays to grain loading operations but do when prolonged moderate to heavy rainy periods are prevalent,” said Amer Badawi, vice president of Columbia Grain.  

When the stoppage lasts for hours, or even a complete shift, the grain can elevator fill up and ultimately the rail system feeding the facility backs up, too.

“It’s a domino effect,” Badawi said. “The record setting month of December 2015 has certainly created challenges for many grain terminals in the region and caused delays to rail system. It would not be a surprise to see some dealing with lingering issues through January.”

Bar Status

Several times during the month, the entrance to the Columbia River was closed due to high seas and gale force winds, allowing fewer ship visits to Portland terminals.  Vessels stuck in the river shifted to other berths to wait several days until bar conditions improved. The Port actively works with the agents for the vessel to try to accommodate lay berth needs necessitated by river closures.

Port of Portland Senior Waterways Planner, Fred Myer says the U.S. Coast Guard makes the call to close the river based somewhat on their own ability to respond to search and rescue in adverse conditions. When it comes to commercial deep draft vessels, they rely on the local expertise of the bar pilots.

Said Myer, “What may appear as a ‘routine’ large winter swell system to the untrained eye, may actually present a dangerous bar-crossing situation. Prevailing wind, currents and tidal effects that increase cross-channel movement can negatively affect ship-handling ability in the navigation channel.”             

FAST Act Passes, Impacts for Oregon and the Region

by Kenny Macdonald 12/14/2015 1:46 PM

December 14, 2015 - Earlier this month, President Obama signed the new five-year, 1300-page, $300 billion transportation authorization bill, cleverly named the Fixing America’s Surface Transportation Act, or FAST Act.  We asked Rick Finn, the Port of Portland’s Federal Affairs Manager what it means for Oregon and the Port of Portland. 

The bill provides modest increases in highway funding to the states.  In the first year of the bill, Oregon’s highway funding will increase by $25 million, or five percent, from $482 million to $507 million. 

Oregon’s funding would then rise by about two percent per year until the bill’s final year in 2020.  In that year, Oregon will receive $553 million, so the bill will provide $71 million more to Oregon than the current level over five years.  Therefore, the Oregon Department of Transportation (ODOT) will have a fair amount of additional money that it could choose to apply to highway projects that would serve Port facilities.

For the first time, the bill creates funding programs specifically focused on improving freight mobility. What are the details?

One of the new programs will direct additional money to the states for freight highway projects.  ODOT will receive $14.5 million in the first year of this program with steady annual increases to over $19 million in 2020.  Not a whole lot of money; however, it’s available for a wide variety of freight-related projects.  Furthermore, up to 10 percent of a state’s allocation could be used for intermodal projects within the Port’s boundaries.  

The other new freight program provides $4.5 billion over five years for “Nationally Significant Freight and Highway Projects.”  It is a new competitive grant program for large highway and freight projects.  It’s funded at $800 million in 2016 with annual increases to $1 billion in 2020.  The minimum project cost is $100 million, with the exception that 10 percent of each year’s funding must be reserved for projects that cost less than $100 million.  The federal share of any project cost cannot exceed 60 percent.  Grade separation projects are among the projects eligible for funding.  

Finally, up to $500 million of the $4.5 billion may be used for freight intermodal projects (including those within the Port’s boundaries) and freight rail projects.

What will states have to do in order to qualify for the additional freight mobility funding?

States will have to develop state freight plans in order to receive the additional federal freight funding I mentioned.  ODOT already has a state freight plan, but it will have to be modified to meet the requirements of this bill.

Is this just an expansion of the TIGER grant program? 

Just to clarify, the bill did not authorize the TIGER grant program. Nonetheless, most people expect the TIGER program will continue to receive funding in the annual Transportation Department appropriations bill. 

There seems to be a “no port left behind” measurement aspect, can you explain that and why it was included?

The bill includes a provision that requires the Transportation Department to establish a port performance statistics program to provide nationally consistent performance measures at the top 25 US ports by tonnage, containers, and dry bulk.  The Department will commission a large, broad-based working group to recommend the performance measures.  The recent West Coast port disruptions prompted this provision.  None of the more far-reaching House and Senate bills introduced in response to the port disruptions has moved forward. 

What else does the FAST Act do?

The bill reauthorizes the Export-Import Bank until 2019, which had been a priority for the Port of Portland and other trade organizations in Oregon.  The Bank can now once again accept and process new requests for export financing assistance.

 

Barge-Rail shuttle service provides shipping relief

by Kenny Macdonald 11/30/2015 1:56 PM

Container barge service is back on the upper Columbia and Snake rivers. The Upriver Container Barge-Rail Shuttle will help importers and exporters in eastern Washington, Oregon and Idaho move containerized agricultural products to markets in Asia. An informal partnership including Northwest Container Service, Tidewater Barge and the ports of Morrow, Lewiston and Portland helped facilitate the return of this service. The first barge is currently loading at the Port of Lewiston this week and expected to get underway Thursday. 

The new service would address key issues driving up the cost of transportation in the wake of losing direct carrier service at Terminal 6 in Portland earlier this year— loss of barge service, container availability and cost of trucking to Puget Sound ports. The planning for the return of container barge service started in summer 2015, and required commitments from multiple transportation providers and key exporting companies to make the service viable.

Empty containers began arriving at the Port of Lewiston in October, now filled with agricultural and paper commodities from Idaho and Washington are ready to be barged to the Port of Morrow in Boardman, Ore. The barge service will continue to carry empties up river and return full every two weeks. In Boardman, these commodities will be combined with Oregon agricultural and paper products and taken by train to the Northwest Container Service yard in Portland, Ore. From there, containers will either remain in Portland for export through T-6 on Westwood Shipping vessels, or continue by rail to seaports in Seattle and Tacoma.

“I am pleased that the Port of Portland and regional shipping partners are offering creative solutions to challenges Oregon businesses face in getting goods to market,” Oregon Governor Kate Brown said. “Having completed my first trade mission to Asia, it’s clear there is a growing interest in Oregon products, particularly agricultural products.”  

The Container Barge-Rail Shuttle provides a cost-effective alternative to over-the-road shipping to Puget Sound ports and utilizes river and rail assets in the region. The primary beneficiaries of this service are shippers of peas, beans, lentils, hay and paper products—high volume, economically impactful commodities for rural Oregon communities that rely on low cost barge/rail transport.

The project is the outgrowth of work the Port of Portland and the State of Oregon took on with shipping companies across the state to find alternate routes to market until weekly transpacific container service resumes at T-6. The Port of Portland contributed $51,000 in seed money to kick start the Container Barge-Rail Shuttle project and offset the additional cost of transferring agricultural products from the barge to rail in Boardman. The shuttle is expected to be self-sustaining by the second full month of service. Once established, rail service from Boardman is expected to increase to weekly as additional importers and exporters participate in the program.

 With the withdrawal of Hanjin and Hapag-Lloyd weekly transpacific service at T-6, container barge service on the Columbia-Snake River system and the container terminal in Lewiston, Idaho shut down. Currently, Westwood Shipping provides monthly container service from T-6 to Asia. To accommodate other exporters, Northwest Container Service increased rail service from Portland to Puget Sound Ports. The remainder of regional export shipping needs is absorbed by an already congested highway system as trucks move cargo to other seaports. 

 Although an important part of the freight solutions equation, based on historical trade volumes, these two providers alone cannot address the gaps in capacity after Hanjin and Hapag-Lloyd pulled out.

 “We appreciate this kind of ‘out of the box’ thinking from all parties involved, providing a partial solution to shipping challenges while we continue working to recruit critical new transpacific service,” said Port of Portland Executive Director Bill Wyatt. “We hope the success of this plan will entice labor and terminal management to come together in agreement sooner and shippers to resume frequent, regular container service.”

Recruitment of new transpacific service is critical to our region and is a priority for the Port of Portland.  The Portland region cargo market of 336,000 TEUs has the potential to support two weekly non-competing, transpacific container carriers. The Port of Portland recently began targeted outreach to four target carriers that can serve Oregon’s key international markets (Japan, China, and Korea).  Resolution of the T-6 productivity issues will be critical to recruitment of new service. 

 

 

Overseas Reps, the Port's Constant Presence in Asia

by Kenny Macdonald 10/23/2015 1:40 PM

October 21, 2015 - Although the trade delegation from the Port of Portland traveling with Governor Kate Brown in Asia will be on their way back home soon, that doesn’t mean the Port won’t continue to be well-represented there. Sometimes in marketing the Port of Portland, it’s as much about relationships as it is what we have to offer, which is why the Port of Portland is represented directly in five Asian cities by agents who help us keep the lines of communication open with potential partners in trade.

Masa Mukouchi, Tokyo and Jim Kim, Seoul both work closely with the Port and Business Oregon in their respective countries. Charles Wang is the President of Formosa Transportation Company in Taipei with Ann Tseng, and branch offices in Tianjin and Shanghai staffed by Jackie Xu, and Zoe Zong, respectively. Phillip Lee in Hong Kong is expanding his role to support air cargo development.

When Portland-based marketing staff visits Asia, they depend heavily upon the overseas offices to work out logistics and schedule business calls in advance. Between visits, agents continue working directly with customers and representing the Port year round. “They maintain a consistent and meaningful presence for the Port by providing continuity between visits,” said Greg Borossay, senior manager for trade and cargo development.

The agents recently visited Portland in mid-August for a series of local sales calls and interviews with Port directors. At a presentation to Port Commercial Team Staff, they provided an overview of overseas customer relationships, offered market insight, and shared what it is like to live and work in the cities of Tokyo, Seoul, Taipei, Shanghai and Tianjin. During their stay, the agents staffed an information booth at Seaport Celebration, the annual public open house the Port organizes at Marine Terminal 4 and helped answer questions from a curious public.

Of course, a major topic of interest is the reestablishment of container service to T-6. Although the Port has other business lines that make up the vast majority of work on the waterfront, the lack of frequent container service that supports the region’s small and agricultural businesses is the proverbial elephant in the room. The overseas agents say it is their top priority.

“Many people ask me when I am going to retire,” says Jim Kim, who has been representing the Port and the State of Oregon for almost 30 years. “Not until I help bring back consistent and sufficient container service to Portland,” he says with a wry but determined smile.

You can find contact information for our overseas reps here

NLRB Ruling Affirmed

by Kenny Macdonald 10/9/2015 11:55 AM

October 9, 2015 - Last week, a three-judge panel at the National Labor Relations Board confirmed a 2013 administrative law judge ruling that the International Longshore and Warehouse Union Local 8 and Local 40 engaged in a variety of activities at Terminal 6, like slowdowns and threats to shut down operations, that violated federal labor laws.

The decision affirms the finding of unfair labor practices set against several parties were meant to influence the Port to give the ILWU jurisdiction over the dockside refrigerated container work, work that has belonged to IBEW for more than 40 years. The decision mandates the ILWU cease and desist from encouraging, threatening or participating in slow-downs, and filing grievance claims to coerce neutral third parties from working with or forcing the Port to reassign the IBEW work at the terminal. According to media reports, the ILWU has indicated it will appeal this decision, leaving open other pending legal disputes between the parties. 

Keith Leavitt, Chief Commercial Officer at the Port says it is unfortunate that this affirmation was delayed because of contention that presidential NLRB judge recess appointments were invalid, an issue that went all the way to the Supreme Court in 2014. It would have been more timely to have this decision when regular container service was calling Portland.

The two largest of three container carriers, Hanjin and Hapag-Lloyd, ceased Portland service in early 2015 after productivity declined to intolerable levels. A smaller remaining carrier, Westwood Shipping, suspended its service in April, but resumed monthly calls in July.

“Nevertheless, we view this  NLRB decision as an important independent review of the underlying jurisdictional dispute and appropriately confirms the Port’s right to assign reefer work to the IBEW,”   Leavitt said.

The Port is working with Terminal 6 operator ICTSI to actively market the terminal for new container service to Asia, Europe and Latin America. While regional cargo volumes continue to grow and will support Portland container operations, restoring service is a complex challenge and will likely require the collaboration of the Port, ICTSI, shippers and longshore labor to be successful.

“Like ICTSI, we would like to see ILWU leave these issues behind, come back to work and rebuild business at T-6. This is a first step. The next is a common commitment by the ILWU, and terminal management to bring this terminal along with its contribution to the regional economy, back to life. Finger pointing won’t get the job done,” said Bill Wyatt, the Port of Portland’s Executive Director.

Portland Preparing for Withdrawal of Largest Container Carrier

by thomaj 2/10/2015 10:55 PM

Hanjin Shipping has notified the Port and terminal operator ICTSI Oregon, Inc. that it plans to withdraw direct call service from Portland as of March 9, 2015. It is the largest container carrier offering service via Terminal 6 – Oregon’s only deep draft international container terminal.

“Hanjin has been a vitally important and longtime carrier in our market, and this will be a tough loss for our region,” said Bill Wyatt, executive director for the Port of Portland. “We have made every attempt to prevent this outcome.”

With a presence in the community since 1993, Hanjin has contracts with the area’s largest shippers. The departure leaves Hapag-Lloyd and Westwood Shipping as the remaining direct calling carriers. The withdrawal will not impact the Port’s other marine business lines such as autos, grain, minerals, steel, project cargo or liquid bulks.

The Port has a 25-year lease with ICTSI Oregon, Inc. for the container terminal that will remain in place, but there are short and long term impacts of losing direct call container service. More than 900 businesses depend on the Port to get their goods to and from international markets, and the Hanjin service supports an estimated 657 direct jobs and $33 million in wages annually.

After March 9, shippers in the region who used the Hanjin service will need to use rail or truck transportation to reach other ports at a higher cost per container. In the coming weeks, Port officials will remain engaged in conversations with Hanjin Shipping, ICTSI Oregon, Inc., shippers and others to explore potential solutions and next steps.

“We are concerned for local importers, exporters and the hundreds of good family wage jobs that depend on this vital service,” said Wyatt. “It will take considerable effort and cooperation, but we will do our best to recruit a new transpacific service like Hanjin.”

Port Auto Business Evolves as Mustang Goes Global

by thomaj 1/21/2015 5:03 PM

Back in 1953, when the Port of Portland first started handling autos, each car was loaded off of the ships – one by one – using a crane. These days, vehicles are driven off and on the ships, which resemble giant floating parking garages. It is much more efficient and with a very low incidence of damage or injuries.

That’s not the only thing that has changed.

Just a few short years ago, the Port was the second largest auto import gateway on the U.S. West Coast and fifth largest in the nation, but its auto export totals were close to zero. Today, exports comprise approximately 20% of the Port’s total auto volumes. In 2014, nearly 50,000 Ford vehicles were exported through the Port, which represented a 400% increase from 2013. 

Strong and growing demand for Ford vehicles in Korea, China and in other international markets was demonstrated by the recent announcement out of Dearborn, Michigan that the iconic Mustang would be shipped globally for the first time. Portland was featured prominently in the announcement as the export gateway for the first shipment.

Auto exports and imports at the Port support more than 500 local jobs that pay above average wages. On the import side, vehicles are accessorized for the North American market by local workers in Portland before being delivered to dealerships. They are also ‘homologated’ in Portland before export to meet the different standards required or desired in Korea and China.

Portland is ideally suited to handle autos, offering a great track record, capacity to grow, a skilled workforce and excellent transportation infrastructure to handle imports and exports. Autos continue to be an important part of the Port’s diverse marine cargo portfolio, which also includes containers, grain, minerals, steel, liquids and project cargo.

Geoff Owen Announced as New Marine Terminal Manager

by thomaj 1/16/2015 11:43 AM

 

Geoff Owen has been selected as the Port’s new marine terminal manager, assuming the role previously held by Jeff Krug, who is now general manager of marine operations.

In this role, Geoff will manage Terminals 2, 4 and 5 and be responsible for all terminal and vessel operations, coordinate Port resources to support terminal operations and serve as the Port’s account manager for existing tenants at each terminal. Geoff will also be assisting the commercial team on new business development initiatives, have operating budget responsibility for each terminal and serve as sponsor on capital projects.

 

Before joining the Port, Geoff served in various capacities in the U.S. Coast Guard (USCG) aboard vessels and also stationed ashore. Geoff was accepted into the USCG legal program and last served in the USCG JAG office as chief, claims and litigation for the western U.S. 

 

Geoff joined the Port as marine security manager in 2008, responsible for security personnel, regulatory compliance and security infrastructure at the Port’s marine terminals. Geoff attended Lewis and Clark College, receiving his undergraduate degree in history and law degree from the Northwestern School of Law.

Study reveals impact of road congestion on state’s economy and jobs

by thomaj 1/6/2015 4:16 PM

Today a coalition of business and civic leaders released an update to a 2005 Cost of Congestion report, revealing that Oregon’s future economic competitiveness and job growth are heavily reliant on an efficient and reliable transportation system.

The 2015 report analyzes the state’s dependence on a reliable transportation system to move goods, ensure access to labor and increase productivity. It highlights that additional transportation investment is needed to maintain Oregon’s ability to remain competitive in a global economy.

“Oregon, including the Portland-metro area, is a sea and air gateway as well as a regional rail and highway hub, which uniquely situates us to be a major player in domestic and international trade,” said Bill Wyatt, executive director of the Port of Portland. “With so much of our state’s livelihood dependent on a robust transportation system, we have a tremendous opportunity and a responsibility to modern and competitive.”

This report identifies the current economic foundation of the state and examines how congestion and transportation barriers affect Oregon’s economy, jobs and productivity. It also analyzes the impact of increased transportation investment on the state’s economy and jobs. Key report findings include:

  • Additional transportation investments would generate 8,300 jobs, $1.1 billion in benefits, and a $2.40 return for every $1 of investment, by 2040.
  • More than 346,000 jobs were transportation-related and transportation-dependent in Oregon in 2013.
  • $300 billion worth of goods moved in Oregon on all modes of transportation in 2012.
  • By 2040, the average Portland-metro household will experience nearly 70 hours of congestion annually, equating to nearly two weeks of time spent sitting in traffic.
  • $920 million of Oregon annual economic output/sales would generated by businesses as a result of an improved transportation system by 2040.

“Our state is heavily dependent on traded-sector industries, which provide well-paying jobs for Oregon’s residents,” said Sandra McDonough, president and CEO of the Portland Business Alliance. “In order to ensure this critical sector continues to grow, we need an efficient and reliable transportation system. We hope this analysis will signal to leaders the need for collaboration and funding at both state and federal levels to keep Oregon economically competitive.”

The report’s data and analysis were compiled by Economic Development Research Group for the Value of Jobs Coalition and was produced by the Portland Business Alliance. Coalition partners include Associated Oregon Industries, Greater Portland Inc., Oregon Business Association, Oregon Business Council, and Port of Portland. View the full report at valueofjobs.com/congestion_2014/.

Port of Portland Promotes Keith Leavitt to Chief Commercial Officer

by thomaj 12/8/2014 5:08 PM

Keith Leavitt has been named the Port of Portland’s new chief commercial officer. Leavitt most recently served as the Port’s general manager of business development and properties. In his new role, Leavitt will hold responsibility for the Port’s business and economic development activities and will work to ensure the Port obtains a market-based rate of return on Port assets. He will oversee both aviation and marine business development functions along with acquiring, developing, managing and marketing the Port’s diversified industrial real estate portfolio.

Leavitt joined the Port in 1999, first serving as state government affairs manager and later as development project manager. Highlights of his Port career include: leading a multi-year Port initiative to change the organization’s container business model, including a global market solicitation for a long term lease of the Port’s T-6 container terminal; and directing several key Port property acquisitions including Troutdale Reynolds Industrial Park and Gresham Vista Business Park.

Prior to joining the Port, Leavitt served as division manager and economic development representative for the Oregon Economic Development Department.

“Keith brings a strong background in business and economic development and commercial property management to this critical Port leadership position,” said Port Executive Director Bill Wyatt. “His 15-year history with the Port, coupled with his insight into the business challenges and opportunities on our horizon, will serve the organization well as we continue our mission to provide access to world markets and grow the region’s economy.”

Leavitt holds a Bachelor of Science degree from Oregon State University and a graduate certificate in real estate development from Portland State University.

He replaces Sam Ruda who will leave the Port later this month to pursue other interests.