By Steve Wilhelm, October 21, 2013, Puget Sound Business Journal
Portland’s loss could be Seattle’s gain, if Korean ocean carrier Hanjin Shipping goes through with plans to stop its weekly service out of the Port of Portland Jan. 6.
“That is going to be, we hope, a positive situation here for us here in Seattle,” saidLinda Styrk, seaport managing director for the Port of Seattle, in a phone message. “We do expect those customers they’ve been handling out of Portland, will continue to route cargo through Hanjin, and we’ll be beneficiaries of that.”
A Oct. 17 letter from Hanjin, obtained by the Portland Oregonian, also suggests Seattle will win. Here also is the Oregonian story.
“With this change, we will seamlessly reroute all shipments currently being served via Port of Portland through Ports of Seattle or Tacoma,” the letter said. “We sincerely apologize for any inconvenience which may arise from the service change.”
But Port of Tacoma spokesperson Tara Mattina said she isn’t expecting much of a boost in cargo there from the Hanjin move.
“We expect Hanjin to send the Portland cargo elsewhere, probably Seattle, where they recently extended their lease,” said Port of Tacoma spokeswoman Tara Mattinain an email.
Here’s how the departure looks in Portland.
Currently Hanjin handles the equivalent of 83,000 containers a year out of Portland, and much of that may be routed through the Port of Seattle instead.
While the shift would add only 4 percent to the Port of Seattle’s total container volume, winning the Portland cargo would be significant for Seattle.
That’s because Hanjin’s continued presence at Terminal 46, and cargo volumes there, are crucial for the Port of Seattle in maintaining the East Waterway as a center of cargo movement. The terminal is the closest one to congestion caused by the viaduct replacement project, and to the proposed site for a basketball stadium, and last year it seemed possible Hanjin could leave the port of Seattle entirely.
The Korean carrier did sign 10-year contract with the Port of Seattle, but due to the obstacles Hanjin won a favorable deal on that contract in terms of remaining, including a $4 million upfront fee.
Operating out of the Port of Portland is expensive, partly because of the cost of the long trip up the Columbia River, and partly because of labor issues.
Hanjin’s Oct. 17 letter focused on costs.
“The cost of serving this port has escalated significantly this year,l to deter us from maintaining quality service which you have come to expect,” the letter said.