Pacific Maritime Magazine - Marine Business for the Operations Sector

Regional Report: Puget Sound


December 1, 2019

Along with the ubiquitous aerospace containers, the Port of Everett, Washington will be moving more containerized cargo. Photo courtesy of the Port of Everett.

Puget Sound is at a critical juncture.

Various building and infrastructure projects that are happening around the region's ports and highways have the potential to dramatically increase maritime business in Puget Sound, such as the multi-year Puget Sound Gateway Program.

But the escalating trade war between the US and China continues to hamper business, so much so that the Northwest Seaport Alliance joined the ports of Long Beach, Los Angeles, Oakland and Portland in sending a letter to President Donald Trump in late September to raise their concerns.

In the letter, the ports detailed some of those impacts, including wheat exports to China, which have nearly stopped this year.

The Northwest Seaport Alliance and Seattle-Tacoma International Airport have also seen dramatic drops in export commodities, including potatoes (-16.85%), hay (-49.93%), skins and hides (-47.89%), salmon (-47.71%), cherries (-54.56%) and fresh crab (-63.34%), according to a recent NWSA release about the letter to Trump.

"The chaos of the current trade war is one of the most prominent risks ahead," said Stephanie Bowman, port of seattle commission president and co-chair of The Northwest Seaport Alliance. "Exporters are losing market opportunities through increased tariffs on sales to China. Changing global trade routes could mean fewer west coast imports as supply chains shift away from China."

Port of Everett

The Port of Everett is close to completing its $57 million South Terminal Modernization project, which will put another full-service berth into use by the end of this year.

When completed, the berth will be able to accommodate larger ships and heavier cargo.

"We have enhanced and added to our rail infrastructure, we are strengthening the wharf, and in June, we received two post-Panamax cranes to service the upgraded terminal," the port said. "To date, all in-water work for this project is complete. The upland structural and utility work will continue through the fall. The terminal will be open for use by December 2019 to support our handling of project, bulk, breakbulk, high and heavy, and containerized cargoes."

The port is also in the process of acquiring a 58-acre site to support additional maritime commerce.

This year, Everett has taken on some new project cargoes, where the port sees emerging opportunities.

"We have been able to develop business relationships with many Canadian firms and look forward to continued growth in that area," the port said.

Everett also continues to explore agriculture business opportunities, and recently picked up some business transloading soybean meal from the Midwest into 20-foot containers for movement to the South Pacific.

Predicting future volumes can be difficult, given challenges that continue to revolve around the global trade situations, the port said.

"Events happen quickly these days," the port said. "Business could dry up overnight or new opportunities could present themselves with little advance notice. Having said that, we are hopeful that projects in Canada and the USA continue to get funded at the current pace. Our key at the Port of Everett is remaining nimble so we can quickly adapt to market changes and stand ready to accept any new opportunity that presents itself."

The Northwest Seaport Alliance

The ports of Seattle and Tacoma are gearing up for some major projects.

Nov. 1 is the deadline to respond to the Northwest Seaport Alliance's call for proposals for Terminal 46, a 50-acre deep-water marine terminal on the Seattle waterfront that's conducive to "water-dependent uses including marine cargo operations, logistics and other maritime-supported activities."

Once one of the Pacific Northwest's most bustling marine cargo terminals, Terminal 46 isn't being used for international cargo movement anymore because of a recent decision by the ports to realign its cargo and infrastructure strategy.

Instead Terminal 46 will be converted into two different operations.

The NWSA plans to develop a 50-acre cargo terminal that could include marine-industrial support businesses and 1,400 feet of the west-facing berth with a depth of -50 feet mean lower low water.

The port of seattle is developing the rest of the land as a single-berth cruise terminal to meet the rising demand for its Alaska cruises. The facility will use 1,500 feet of the northern part of the west-facing berth for cruise operations, according to NWSA.

Meanwhile, a modernization project to make the ports 'big ship ready' is underway.

In July, NWSA officials, the president of the International Longshore and Warehouse Workers of Local 19, and president of local terminal operator SSA Terminals broke ground on Terminal 5.

The project was funded with investment from the NWSA ($340 million) and private partner SSA Terminals (up to $160 million).

By upgrading Terminal 5, the ports will be able to handle container ships carrying as many as 18,000 TEUs at the 185-acre terminal, according to NWSA.

The North and South harbors are already receiving 14,000 TEU-size vessels on a regular basis. "Today we begin the modernization of Terminal 5, the best container handling terminal in the Pacific Northwest," said Stephanie Bowman, port of seattle commission president and co-chair of The Northwest Seaport Alliance, at the ground-breaking. "When complete, it will be a cornerstone of our region's economic activity for decades to come."

The project will open in two stages. The first is expected to open in Spring 2021 with one major berth ready to accept international containers, while the other berth will be ready for business in 2023, according to NWSA. Activity at Terminal 5 will mean an estimated 6,600 new direct jobs and over $2 billion in business activity.

"As a local terminal operator in Seattle for the past 50 years, SSA Terminals is proud to be part of making Terminal 5 a modern asset in this harbor," said Ed DeNike of SSA Terminals. "We see this investment as part of a long-term growth strategy and look forward to its development."

"As an exporter and importer utilizing both ports, it is critical that we have access to efficient first-class infrastructure to move goods through these ports," said Jan Koslosky, vice president of supply chain management for Ocean Beauty Seafoods. "We applaud The Northwest Seaport Alliance as they invest in the future with Terminal 5."

Other terminals are also investing in their operations. Husky Terminal recently spent about $250 million in terminal upgrades on Tacoma's General Central Peninsula, including berth strengthening and realignment and adding eight new super-post-Panamax cranes.

The cranes from Shanghai Zhenhua Heavy Industries Co. Ltd, four of which traveled through the Puget Sound in March to join the first four that were delivered in 2018, are able to simultaneously serve two 18,000-TEU container vessels. They have an outreach of 24 containers and a lift height of 165 feet above the pier deck, according to NWSA.

Washington State Department of Transportation

One of the biggest projects in the region is the Puget Sound Gateway Program, a two-project development that consists of the completion of SR 167 in Pierce County and the completion of SR 509 in King County.

Both highway projects are vital links to the ports of Seattle and Tacoma and move people and goods more efficiently through the region. Improving traffic congestion and providing vital connections between the ports and the industrial areas of South King and North Pierce counties are some of the projects benefits.

Placing both projects under one program also allow the transportation agency to leverage its resources more efficiently as well. By coordinating with partnering cities, counties and ports, three financial options to accelerate the schedule were presented to the Washington State Legislature, said Program Administrator Craig Stone.

"At the end of the legislative session in April 2019, the Legislature provided approval for the Gateway Program to complete the project 3 years earlier, from 2031 to 2028," he said. "We have adjusted our procurement and construction schedules to meet a 2028 completion date."

Meanwhile, the agency has authorized design-build contractor, Guy F. Atkinson Construction, to proceed on the first project on SR 167, which will provide a new 4-lane bridge over I-5.

Atkinson is currently doing final design, and preliminary fieldwork to locate utilities, with major construction to start in early 2020, Stone said.

Everett sees quite a bit of breakbulk, such as this LNG tank offloaded recently. Photo courtesy of the Port of Everett.

Also, the transportation agency has entered into a funding agreement that would permit Sound Transit's Federal Way Link light rail extension to include elements of the SR 509 project, Stone said. Sound Transit has given Notice to Proceed to their design-build contractor, Kiewit, to build a new State Route 99 bridge over SR 509 with light rail above, he said.

It is more efficient for one contractor to build both projects due to the proximity of the light rail and the SR 509 projects, he added.

"Completing SR 167 and SR 509 will provide improved freight access to the ports of Seattle and Tacoma, along with air cargo to Sea-Tac International Airport, from the warehousing, manufacturing, and industrial areas of King and Pierce counties," Stone said. "More reliable freight trips will help Washington ports and businesses stay competitive. Combined, the ports are the second largest on the west coast, which makes improved access especially important to ensure they have the ability to meet growing demand."


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