Portland’s container business could move to Puget Sound

John Gillie, April 10, 2015, The News Tribune

The ports of Tacoma and Seattle could soon see an upward bump in their business not because of their upcoming marketing and operations alliance but because of the misfortune of another Pacific Northwest port.


The Port of Portland’s major container terminal in recent weeks has lost its two main customers, Hanjin Shipping Co. Ltd. and Hapag Lloyd. The two shipping lines handled some 90 percent of the container business at the Port of Portland. After their departure, only Puyallup’s Westwood shipping Line will serve the Port of Portland with monthly container ship calls.


The demise of Hanjin’s and Hapag Lloyd’s Portland ship calls means that in most cases their customers will shift their cargo to the ports of Tacoma and Seattle, the nearest ports where Hanjin and Hapag Lloyd call.


Hanjin calls at both the ports of Tacoma and Seattle. Hapag Lloyd calls at the Port of Tacoma as part of the four-member Grand Alliance. Even if all of Portland’s container traffic were redirected to Puget Sound, the increase would be a fraction of the number containers the two ports already handle. The Port of Portland last year handled some 165,000 20-foot container units. The two Puget Sound ports last year handled 3.43 million TEU’s (20-foot equivalent units).


The two shipping lines reportedly are leaving the Oregon port because of continued labor unrest at Portland’s Terminal 6. The International Longshore and Warehouse Union has battled with Terminal 6’s operator, ICTSI, for years. The union says the foreign-owned terminal operator is mismanaging the terminal. ICTSI says the union is disrupting work at the terminal.


ICTSI said it has launched an effort to attract new shipping lines to the Columbia River terminal.


Much of Portland’s container business was generated in the agricultural industries in Eastern Washington, Oregon and Idaho. Those businesses often shipped their products down the Columbia and Snake rivers on barges to be loaded aboard container vessels at Portland. Those industries now face the prospect of loading their containers on rail cars or trucks to reach Puget Sound ports.


The ports of Tacoma and Seattle in recent months have begun planning to begin marketing and operating their container terminals under the authority of a two-port alliance. Motivating that action in part is the shipping industry’s move to consolidate their shipping activity in just a few mega-terminals where ever-larger ships will load and discharge their cargoes.


The alliance is still in the planning stages, but the two ports hope to solidify their alliance by late summer.

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