Pacific Maritime Magazine - Marine Business for the Operations Sector

Regional Report: Columbia River Exports Continued to Grow in 2018

 

June 1, 2019

American Cruise Lines' American Song, billed as the first dedicated US-flagged river cruiser with a contemporary design, made its first call on the Port of Astoria in April. Photo by Peter Marsh.

While trade tensions remain between the United States and Oregon's top trading partners, China and Canada, data from the US Department of Commerce shows Oregon exports to both countries increased the most of any international partner in 2018 over the previous year. In 2018, the Columbia River ports loaded 574 ships with grain and soya, and unloaded about 180 car carriers. There were more than 100 ship calls for potash, soda ash, metals and ores, and chemicals, and 200 shipments of petroleum fuels.

Oregon exported $22.3 billion in goods - a 1.8 percent increase from 2017-while five of its six top export destinations, China, Japan, South Korea, Malaysia, and Vietnam received at least $1 billion in goods. Only about one-third of these are subject to proposed or enacted tariff increases. Electrical and industrial machinery are not subject to tariffs and are seeing some of the largest gains. "In a trade-dependent state like ours, we rely on strong trading partnerships to help Oregon farmers feed the world and local businesses continue to grow," said Curtis Robinhold, executive director of the Port of Portland. China received $4.7 billion in Oregon exports, a 20 percent jump from the previous year.

The Port has seen robust two-way trade activity via its four marine terminals and an international air cargo partnership with Cathay Pacific. Exports to Canada, which totaled $3.2 billion in 2018, saw more than 35 percent growth from 2017, rebounding in the past 18 months due to heavy manufacturing exports that experienced a 69 percent increase last year. Japan is Oregon's largest food and agricultural export market, followed by Korea, Canada, and China.

Since a brief dip in 2015, exports of agricultural goods - from hay to hazelnuts to wheat - have been steady and grew by nearly 4 percent in 2018. "Food and agricultural exports remain critical in supporting communities across the state. With 80 percent of Oregon's food and agriculture production leaving the state, agriculture's $98 billion-dollar economic impact is felt in all corners of the state," said Alexis Taylor, director of the Oregon Department of Agriculture. Potash, a fertilizer, is the largest mineral export; it is mined in Saskatchewan but exported out of the Columbia River.

"Last year's gains are especially welcoming given the current global environment where the strong US dollar, slower international growth, and increased trade tensions all work against US exports," said Josh Lehner, senior economist with the Oregon Office of Economic Analysis.

Since the loss of container service to the Port of Portland's Terminal 6 in 2016, the port commission has been working to create a sustainable business model for container shipping. A consultant was hired to conduct a study, and concluded that since local container volumes are lower than most west coast ports, the most viable T-6 business model is a multi-use terminal that dedicates revenues from more profitable activities to support container service. "This analysis reinforced that there is no silver bullet for container service," noted Robinhold. "With the strong backing of shippers, labor and businesses, I'm hopeful that we can continue to offer container service options for shippers at T-6, while ensuring long-term financial stability."

One bright spot for T-6 was the first ever move of wind turbine tower sections, bound for a wind project in Eastern Oregon. They arrived from Korea in three separate ship calls, and were handled by Portland-based Omega Morgan. "With our North American headquarters in Portland, we're especially proud to be bringing these shipments through Portland," said Arturus Espaillat, Senior Manager, Transportation for Vestas North America.

Port of Morrow

The Vestas shipment also benefited the small Port of Morrow, Oregon 170 miles upstream. They partnered with Omega Morgan to facilitate transferring the towers and the 220-foot blades, the longest load ever transported by road in Oregon, that were shipped by rail from the Midwest. "We were looking for a route to get the blades as close as possible by rail to the Montague Wind Power Facility near Arlington, then move them by truck to the site. We got clearance into Boardman and set up our staging area there." explained Erik Zander, director of sales for Omega Morgan.

The port is part of the eight-member Columbia River High, Wide and Heavy Corridor Coalition. The proposed High, Wide and Heavy Corridor along the Columbia River would capitalize on existing multi-modal transportation methods, improve infrastructure, and create new economic opportunities in the Inland Empire. High, wide and heavy loads currently ship from international manufacturers through Houston, Texas and are transported north to projects in the Midwest and Canada.

Establishing a route through the Columbia River ports would save shippers time and money with shorter transit times and reduced handling. A case study completed by Omega Morgan demonstrated a savings of 28 days and 6,208 miles using the Columbia River corridor. In December 2018, the Port of Morrow was awarded a $19.4 billion-dollar BUILD Grant to fund infrastructure improvements at marine terminals. The project extends new rail lines from the Union Pacific mainline to four terminals which will enable rail-to-barge access for shipments along the Columbia River.

"The BUILD Grant will create a unique opportunity for energy projects to unload at lower river docks and barge upriver to our terminals with the option to continue on rail or visa-versa for exports. Utilizing barges on the river system will be a key component to decreasing the amount of emissions and congestion on our roadways," said Ryan Neal, the port's executive director.

Vancouver Creates New Opportunities on Waterfront

The Port of Vancouver (Washington) logged record-breaking cargo tonnage for the fifth year in a row, with 2018 coming in at 8.1 million metric tons. This marks an 8.3 percent increase over last year's record of 7.5 million metric tons. Imports of steel saw an increase of 16.6 percent, and Subaru also had another record-breaking year by importing 91,544 vehicles - a 4.1 percent increase. Total imports increased by 6.2 percent, climbing from 1.24 million metric tons in 2017 to a record-breaking 1.32 million metric tons in 2018.

Overall exports increased by 8.7 percent in 2018, with strong gains in several commodities. Corn exports climbed an impressive 61.3 percent and copper concentrate increased by 40.7 percent, thanks to continued strong demand in Asia. This contributed to an increase in operating revenue from $36 million to $38 million in 2018. The Port of Vancouver USA expects to see continued growth in autos, steel, minerals, wind energy components and grain in 2019.

The West Vancouver Freight Access project won a 2019 American Council of Engineering Companies Engineering Excellence Award. Omaha, Nebraska-based engineering firm HDR was the port's prime consultant. The WVFA cost over $250 million and was a concerted, decade-long effort to generate economic benefit by investing in freight rail infrastructure, including construction of a new port rail entrance, expansion of the port's rail corridor and the addition of a loop track at the port's Terminal 5. The overall project increased the port's railcar capacity from 50,000 to 400,000 cars annually.

"By continuing to invest in critical infrastructure and diversifying our portfolio of cargoes and customers, we were able to deliver another record year during a time of significant uncertainty in global trade," said port CEO Julianna Marler.

The port is also actively developing Terminal 1, immediately adjacent to the Interstate 5 Bridge where this 10-acre waterfront property offers opportunities for commercial development adjacent to a high-end commercial and residential development planned by Columbia Waterfront LLC and a new city park. "The port's overall concept for Terminal 1 includes adaptive reuse of the historic Terminal 1 facility, including open spaces and other public amenities," said Mike Schiller, port director of business development. Submissions were due by March 21.

A revised city code now allows for future construction of specific water-related structures including a new dock. "I really appreciate the support from the city, Ecology and BergerABAM, and Matt (Harding) leading those efforts," said port CEO Julianna Marler.

Port of St. Helens Becomes 'Port of Columbia County'

Last summer, Port of St. Helens commissioners voted 4-0 to change the name of the port to the "Port of Columbia County. "This name is more descriptive of the geographical region of the port district, which spans the entire 51-miles of Columbia River frontage of Columbia County, and includes the cities of Scappoose, St. Helens, Columbia City, Prescott, Rainier and Clatskanie," explained Port Commissioner Mike Avent.

The Port owns 10 different sites and 2,400 acres of land (more than 1,100 acres of which are available) and supports direct employment of over 475 jobs with more than $29 million in direct annual labor compensation and a direct annual GDP of approximately $66 million. The Port has a total operating revenue of $15.6 million for FY 2018-201. Composites Universal Group, a supplier of composite manufacturing services and tools and a leader in precision patterns and molds is now established in a new $1.44 million, 11,570 square foot building in Warren. This houses two industrial autoclaves and ovens to expand and consolidate the company's production capability. The company is manufacturing one hundred carbon-fiber floats that Kenmore Air Harbor of Seattle will fit onto a series of Chinese Harbin Y-12 twin-engine turboprops to convert them into seaplanes.

In March, NEXT Renewable Fuels announced it has selected 94 acres to lease from the port in addition to a 25-acre parcel they have purchased at Port Westward in February from Teevin Bros, which operates the log transfer yard in Rainier. NEXT estimates the cost of its proposed renewable diesel plant at $1.1 billion - assuming a zone change is approved to allow industrial use on the land. The port is hoping to rezone a total of 837 acres from farmland to industrial use land.

Longview Selects Railway Veteran to Lead Business Team

Port of Longview reports that the major part of marine cargo activity in 2018 was boosted by exports of more than 10 million metric tons of soya and grains, an increase of almost a million tons over 2017, which makes the port one of Washington's biggest bulk exporters. Inbound cargo was up one third at 187,192 metric tons. Overall, the port unloaded 13,558 railcars and counted 267 ship visits. This generated a total of $1.7 billion of economic activity in the region.

In April, the port welcomed Christian Clay as its new Director of Business Development. Following a 20-year career with Burlington Northern Santa Fe, Clay has the experience to help grow cargo volumes and expand business opportunities. He will be responsible for developing long-range business plans that align port infrastructure and assets with growing and emerging markets. This will include seeking development opportunities for the former Continental Grain Terminal at Berth 4. "Clay is a strong addition to our team," said Chief Operating Officer Dan Stahl. "His skillset directly complements our existing team and will allow the Port to successfully meet growing business demands."

The Port of Kalama

Besides operating the port with the largest tonnage of grain loaded on the west coast, the Port of Kalama manages the Kalama River Industrial Park, a number of deep-water berths that require annual dredging, and a small boat marina. To provide moorage for Harbor launches and other commercial vessels, the port purchased a 171-foot pontoon two years ago for conversion into a dock that would be installed at the north end of the marina.

The contract for site preparation and pile driving was awarded to Bergerson Construction. WCT Marine and Construction of Astoria will retrofit the pontoon to service vessels at anchor. "This project is the first step to installing the Port's long-planned commercial dock facility to better serve marine commerce," said Liz Newman, marketing manager, Port of Kalama. Total cost is expected to be more than $2 million.

On October 5, 2018 the port held an event celebrating the new industrial building at the Kalama River Industrial Park. The 120,000-square-foot location already has two tenants: Marco Industries, ventilation and accessories for metal roofs, and Bridger Steel metal panel systems manufacturer. The building has a remaining 40,000 square feet ready to lease. A McMenamins Hawaiian-themed restaurant and rooftop bar, with attached 40-room hotel, is attracting large numbers of new visitors to the waterfront park and community.

The proposed methanol plant continues to navigate the permit process. The draft Supplemental Environmental Impact Statement was published last year, and the public comment period closed in December 2018. The final Supplemental Environmental Impact Statement is being prepared for publication this year.

Port of Lewiston

The Port of Lewiston is the most inland seaport on the west coast, located 465 river miles from the ocean. In 2018, the port shipped 620,586 tons of wheat in 187 barge-loads containing a total of 20.7 million bushels. The port also imported 190,000 tons of breakbulk. "We are continuing to work on break-bulk volumes, with foreign equipment that arrives by ship, then travels upriver by barge. It is offloaded here, put on a truck and taken into the interior of the US," explained Scott Zuger, Terminal Manager.

The Lewis-Clark Terminal's new Barley Load-Out Facility is the second construction project in the last two years. This project will help increase the efficiency of farm-to-market connections and includes an upgrade to the conveyance system. Farmers are getting higher yields per acre and today's combine harvesters can handle more bushels, per hour, per day, to bring to the facility. "This project will allow LCT to receive high volumes of grain and store it more quickly and efficiently. The new rail loading facility will be able to handle up to six rail cars at once and is designed for easy cleaning for receipt and accommodation of the diverse variety of commodities," added Zuger.

Port of Pasco

The Tri-Cities has four large grain terminals, part of the system of 27 of these truck-to-barge terminals on the Snake and Columbia rivers that move approximately 10 million tons of cargo valued at more than $3 billion each year. For the cargo on just the Snake River alone, that avoids 43,610 more rail cars or more than 167,000 semi-trucks. The decline in other cargoes and the loss of container traffic had significantly impacted Pasco's container barge terminal, but the $150 million project to convert the Packaging Corporation of America's Wallula paper mill into a cardboard plant is leading a revival.

Wood chips for the plant are barged from lumber mills at Bingen and White Salmon to the Port of Pasco's barge slip. From there, the chips are transferred to trucks and driven to the Wallula paper plant to make packaging materials for recyclable cardboard boxes. PCA produces over 4 million tons of product per year.

In 2018, the Tri-Cities Airport broke a record with more than 785,000 passengers passing though. This support enabled the airport to develop a collaborative effort from numerous community agencies and businesses to introduce non-stop direct air flights by United Airlines to Los Angeles International Airport. "This is a huge win for the Tri-Cities," said Buck Taft, director of the Tri-Cities Airport. "We've worked for years to gain this service." The late-afternoon departure will also allow Tri-Cities travelers to connect directly to United's domestic and international network.

Port of Astoria

The Port of Astoria continues to attract cruise ships for a stopover on their way from the tropics to the Alaska run with six ships scheduled in the first half of the year, and another dozen in the fall on their way south. "The port's growth in the cruise Industry is evidenced by the 2020 schedule which indicates 30 plus ocean-going vessels coming to Astoria," said Susan Transue, the port's new Director of Operations.

The heaviest lift so far by WCT Marine, the operator of the south Tongue Point shipyard property at Astoria, is the 330-ton tug James T owned by McAmis.

The American Song, American Cruise Lines newest design made its first call on the port in April. ACL claims this is the first dedicated US-flagged river cruiser with a contemporary design, and joins the company's two historically-themed vessels with sternwheels running one-week cruises on the Columbia and Snake Rivers.

Three miles east of the port, the south Tongue Point Shipyard property has seen a significant increase in business after upgrades to the haul-out system under the ownership of Hyak Maritime (see pacific maritime magazine, Jan 2019). The WW II seaplane ramp has been reinforced with 24 steel pilings driven through the reinforced concrete to increase the capacity to more than 2,000 tons. The heaviest lift so far by WCT Marine, the yard operator, is the 330-ton tug James T owned by McAmis.

 
 

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