Economy: High-performing Ports

Georgia’s deepwater ports industry will continue to outperform its peers by tapping directly into the growth that is taking place overseas, diversifying the services that call on Georgia’s ports and taking market share from other U.S. ports.

In 2017-18, higher demand for consumer goods, greater use of construction materials and increases in industrial and agricultural production will drive more shipments through Georgia’s ports. The main headwind will be the strong U.S. dollar.

The superb performance of Georgia’s ports relative to other economic sectors and U.S. ports reflects two factors: (1) the strength of our regional economy and (2) comparative advantages resulting from years of strategic expansions.

Georgia’s ports create substantial economic impacts. They support more than 369,000 full- and part-time jobs. Port operations help to preserve Georgia’s manufacturing base and foster growth of the state’s massive logistics, distribution, warehousing and agricultural industries. Deepening the Port of Savannah will preserve these port-dependent and port-related jobs.

The expanded Panama Canal is already causing the use of super post-Panamax vessels to increase dramatically, forcing shippers to move their largest and most economic-impact rich operations to ports that can accommodate the larger ships. According to the Panama Canal Authority, the Port of Savannah receives 30 percent of the loaded import containers destined for the East Coast via the Panama Canal.

The bottom line is that deepening the inner harbor is not only essential to growth, but is also essential to retaining shippers who already use the ports. The deeper channel will allow the largest ships to access the port with more scheduling flexibility. The expansion will not only generate more traffic from larger ships in the future, it will also ensure that the economic benefits Georgia already enjoys do not decline.

The state has set aside its full share of the construction costs for the Savannah Harbor Expansion Project (SHEP). As of mid-2017, the deepening of the outer harbor was 60 percent complete.

The U.S. Army Corps of Engineers found SHEP to be environmentally and economically sound. For each dollar spent, $7.30 will be returned in benefits. The larger ships will be much more fuel-efficient than the smaller ships currently in use, allowing more cargo to move while reducing greenhouse emissions.

The Georgia Ports Authority (GPA) is preparing for the increased activity and larger ships, adding enormous neo- and post-Panamax cranes, a 30-acre container field and the new Jimmy DeLoach Connector, which provides a four-lane limited access truck route between the Port of Savannah and I-95 and I-16.

To extend its rail advantage into Alabama, Tennessee, Kentucky and other states, the GPA is building an inland terminal in Chatsworth that will use rubber-tired gantry cranes to move cargo between trucks and CSX trains.

The Port of Savannah International Multi-modal connector project will double rail capacity and increase velocity at the Garden City Terminal. When complete, it will allow the Port of Savannah to build 10,000-foot-long unit trains on terminal without disrupting nearby traffic. CSX and Norfolk Southern will be able to provide more frequent and faster rail services to cities like Memphis, St. Louis, Chicago and cities in the Ohio Valley as part of the GPA’s Mid-American Arc.

This Mid-American Arc is likely to succeed because: (1) Savannah is the first port of call for many Panama Canal shipping services; (2) Norfolk Southern and CSX provide double-stack container trains between Savannah and the Midwest; (3) Savannah is 1,000 miles from Chicago by rail, which is comparable to other ports; (4) the Port of Savannah can reliably move most cargo from ship to rail within 24 hours and guarantees that for priority shipments; and (5) Savannah offers the fastest westward transit times in the South Atlantic region.

The Port of Brunswick specializes in non-containerized trade and is the second-busiest port in the U.S. for transporting new automobiles and heavy machinery. To accommodate and encourage additional growth, the GPA is doubling its capacity.

All the pieces are in place for ports to fuel further economic benefits for our state.

Categories: Economy