PORT BATTLE ROYALE

Mayor Peyton wants Jacksonville to become the premier port of the Southeast, but Savannah and Charleston aren't going to yield their advantages without a fight

By David Bauerlein, The Times-Union

Separated by 140 miles of coastline, Jacksonville and Savannah, Ga. are natural rivals for international trade. Mayor John Peyton wants Jacksonville to become the "premier port" of the Southeast.

The Port of Savannah has no interest in relinquishing that title to anyone.

"Let the competition begin!" said Trip Tollison, chief operating officer for the Savannah Area Chamber of Commerce.

Tollison delivered the line with a laugh. But he added that in the port business, competition is a fact of life and Savannah takes seriously the challenge from other cities that want to steer more business to their harbors.

By the numbers, Savannah is far ahead of Jacksonville. Its port handled 2.6 million cargo containers in 2007, ranking it the fourth-busiest in the nation for containers, according to the American Association of Port Authorities. Jacksonville also is behind the Port of Charleston in South Carolina. Charleston loaded and unloaded 1.75 million containers, 11th best in the country.

Jaxport handled about 710,000 containers, good enough for 19th on the list.

Still, Jacksonville officials say they expect the port can close the gap because Jaxport has opened trade lanes with Asia, which is the region that has powered Savannah's growth. Peyton said Jacksonville should invest in the port now so it can rise to the top in the Southeast.

"I would expect that a decade from now, in 2018, we will be neck-and-neck with Savannah or have passed Savannah," Port Authority Executive Director Rick Ferrin said.

Jacksonville's challenge is that it isn't just facing off with the cities of Savannah and Charleston. Savannah's port is part of the Georgia Ports Authority. Charleston is overseen by the South Carolina State Ports Authority.

Jacksonville is competing with the states of Georgia and South Carolina.

Georgia officials view Savannah as part of a statewide network for global trade that includes Hartsfield-Jackson Atlanta International Airport.

"It's all linked together so it makes distribution easier," said Alison Tyrer, spokeswoman for the Georgia Department of Economic Development. "We really consider Georgia to be the gateway to the Southeast and, in some areas, to the U.S."

Tollison said the state's financial support has been crucial for Savannah, resulting in billions of dollars in investment over the past 20 years. The financial support by the General Assembly meant Savannah could expand and react quickly to the rising tide of Asian imports. Congestion at West Coast ports has caused Asian shippers to bring more cargo through the Panama Canal to East Coast ports for unloading.

Around 50 percent of the Savannah port's trade comes from China, Taiwan and Hong Kong, according to the Georgia Department of Economic Development.

"Our port authority has gone to tremendous lengths to establish Asian alliances," Tollison said. "That has paid big dividends."

Savannah's sizzling growth rate - almost 21 percent in 2007 - also stems from the Port of Charleston facing constraints on its growth, Tollison said.

The economic impact goes beyond the docks. Heineken, Lowe's, Target and IKEA have picked Savannah for import distribution centers.

Jaxport's plans for growth

Jacksonville officials say they expect a similar payoff for Northeast Florida after Mitsui OSK Lines finishes building the $232 million TraPac Container Terminal. The TraPac terminal will be able to handle up to 800,000 containers a year.

Jaxport is negotiating with Korea's Hanjin Shipping for construction of another Asian-based shipping terminal that could accommodate up to 1 million containers annually. In addition, Jaxport officials want to upgrade existing docks at Blount Island to handle supersized ships.

Cargo containers aren't the only way to measure port activity. Other comparisons are based on total tonnage, the dollar value of goods or a specific category of goods. For instance, Jaxport was the transit point for about 615,000 vehicles in 2007, making it the nation's second busiest port for roll-on, roll-off shipments.

But containers are the most widely used measure, based on the standard of a 20-foot-long container.

If anything, the container gap has widened between Jacksonville and Savannah in recent years. Savannah posted a 21 percent gain in 2007, whereas Jaxport slipped by almost 8 percent. Ferrin said Jacksonville's decrease stems from an economic slowdown in Puerto Rico, which for years has been Jacksonville's major trading lane.

"When you really concentrate on one trade lane, it catches a cold and you end up with pneumonia," he said.

To diversify, the port has added Central and South American markets in the past decade. More recently, Jaxport has turned to Asian trade. The flow of cargo through the Panama Canal will grow after the canal is expanded to handle supersized ships in 2014. Jacksonville, Savannah and other ports are all racing to get their channels dredged for the bigger ships.

Tollison said a deeper harbor is the "single biggest thing" Savannah needs to maintain the port's growth. Savannah has been doing studies for a decade and wants a 48-foot-deep channel. The plan has faced opposition from environmentalists and the U.S. Fish & Wildlife Service. The U.S. Army Corps of Engineers is expected to issue its report this month.

"I feel like we've got the ball on the 2-yard line," Tollison said.

Jaxport expects to get a report next year from the corps.

Ferrin is banking on a 47-foot-deep channel, which would cost $500 million. Ferrin said the port would seek $350 million from the federal government. Jaxport would pay the rest.

 

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