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Port of Tampa Poised for Growth
By Mary Kelley Hoppe

Florida’s largest port, the Port of Tampa has embarked on one of the most aggressive capital investment programs in its history to accommodate future growth, much of which is expected to follow the 2014 Panama Canal expansion.

The Tampa Port Authority and Horizon Lines recently announced the launch of a regularly scheduled direct container service between Tampa and San Juan. With plans to capture a larger share of the lucrative container cargo market, Tampa is expanding its container yard from 25 to 160 acres.
The Tampa Port Authority and Horizon Lines recently announced the launch of a regularly scheduled direct container service between Tampa and San Juan. With plans to capture a larger share of the lucrative container cargo market, Tampa is expanding its container yard from 25 to 160 acres.

This year alone, the port will invest nearly $100 million in improvements, including the first phases in a multi-year expansion of its container terminal. Over the next few years, the port plans to expand its container yard to six-and-a-half times its current size, from 25 to 160 acres with 2,700 feet of berth. The most recent expansion, scheduled for completion in November, will increase the paved storage space for container shipments from 25 to 40 acres and add 52 new reefer plugs for refrigerated containers.

“With completion of the work this year we will have a container capacity of upwards of 200,000 TEUs (or 20-foot equivalent containers),” said Wade Elliott, director of marketing for the Port of Tampa. At build-out of the container yard, the port could accommodate 750,000 to 1 million of the trailer-sized containers.

That’s good news for a regional container market that is underserved. The port’s primary market for container goods lies along the burgeoning I-4 corridor, extending east from Tampa to Orlando and serving 8 million people. Within 100 miles of the port, the Executive Shipper’s Council, an association of more than 140 exporters and importers, controls 250,000 TEUs per year, about half of the estimated market potential within a competitive drive of the port. These companies are eager to support container lines that call on Tampa and avoid the considerable extra cost and inconvenience of having to truck goods from more distant ports such as Miami, Jacksonville or Savannah.

Meanwhile, the region continues to emerge as a major gateway for product distribution, with plans for over 40 million square feet of new distribution center capacity. Rooms to Go recently announced plans to expand its distribution center by 700,000 square feet to 3.2 million square feet, and Premier Beverage is planning a new 1.5-million-square-foot distribution facility.

Cruise activity at the nation’s eighth largest cruise port, with 382,000 passengers last year, continues to grow with the addition of newer ships and extended sailing seasons.
Cruise activity at the nation’s eighth largest cruise port, with 382,000 passengers last year, continues to grow with the addition of newer ships and extended sailing seasons.

While most Gulf ports saw significant declines in their container business this year, container cargo through the Port of Tampa rose nearly 20% to 37,885 TEUs in the first three quarters of fiscal year 2009 as compared to the same period the previous year. Altogether, the port will handle about 50,000 container units in 2009, and expects that business will grow to 65,000 TEUs in 2010 and 100,000 TEUs by 2012.

“We’re building out in a planned manner so when it’s completely done our investments will be completely tuned to the market pick-up,” says Port of Tampa CEO Richard Wainio.

Zim Integrated Shipping has been a dominant force in the development of the port’s container business, accounting for 81% of the port’s container shipments. Its Asia-Gulf Express (AGX) service, launched in 2006, includes a fleet of 10 ships that provide weekly service to Tampa from China, Japan and Korea, with calls in Panama and Jamaica. In September 2008, Zim’s 4,038-TEU-capacity M/V Kaohsiung became the largest container vessel to call on Tampa to date.

Building on Bulk
While expansion efforts emphasize the lucrative container business, the port continues to upgrade and expand facilities that support its bulk cargo operations – mostly petroleum products, chemicals, phosphate and fertilizer – which account for about 30% of the port’s operating revenues. Two new terminals are under development at East Bay and Port Redwing. The port also is undertaking a $35-million renovation of its REK Pier, which provides the primary source of petroleum for the region from Ft. Myers to Ocala and Orlando.

One of the largest American Recovery and Reinvestment Act projects in the area, the I-4/Crosstown Connector project will make the port more attractive to bulk shippers. More than $105 million in stimulus funding will be used to connect the Port of Tampa, Interstate 4 and the Selmon Crosstown Expressway, steering port traffic off roads in Ybor City so it can move more quickly. The port handles about 11,000 trucks per day, a number that is expected to grow substantially with an increase in container shipments.

Cruising Higher
Cruise ship traffic also continues to grow with a 5% increase over last year. “We have more cruise passengers this year than last because cruise lines are marketing their products very aggressively,” Wainio notes. The future is even brighter, he adds. Royal Caribbean is bringing in the 2,500-passenger Radiance of the Seas in 2010, Holland America is talking about bringing in a larger vessel and Carnival, the big company in the industry, is considering further expansion with either a larger ship or additional ships.

The ace in the hole for Tampa will come when Cuba eventually opens to American trade and tourism. “The major constraint we have for cruise ships is that we can conveniently serve only a limited itinerary of countries from here,” Wainio said. “From a cruise perspective, Cuba is more important to us than any other port in the state of Florida. Adding Cuba as a destination would give us a huge addition to our diversity and every cruise line is seriously looking at Tampa for that purpose.”

Having Cuba as a trading partner is also likely to increase the port’s cargo business, he said. “We see Cuba as being very important in the broader context of trade and a broader regional basis – where Cuba is one of a number of countries served by direct shipments out of Tampa.” That’s much like what Crowley Shipping does now, with Cuba serving as a wayport to and from Guatemala, Honduras and other ports providing more business, noted Wainio.

“By itself, back and forth to Havana, that service wouldn’t exist,” he said. “We do believe there are real opportunities that involve Cuba once the trade embargo is lifted, but it is not as large as others would lead people to believe. Sometimes people seem to forget that Cuba is an island the size of Pennsylvania with 11 million people who are mostly impoverished.”

 

Photos courtesy Tampa Port Authority