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Jan 15, 2008

DARK PROGNOSIS * USA - Container cascade will swamp US ports

Plan B port diversification strategies by shippers to the US have enabled the country's bursting ports to avoid the choking peak season congestion that brought trade to a standstill in 2004 ... But for how long?

Denver,CO,USA -CargoNews Asia, by Luka Powanga -15 Jan 2008: -- Last year's peak season passed without any major hiccups in cargo handling, with many shippers using Gulf and East Coast ports as alternative routes... The highway system that accounts for 71 percent of all freight tonnage is severely handicapped. The vehicle miles of travel have grown by 100 percent over the past 20 years and yet the lanes have increased by a meagre four percent, generating an imbalance between traffic volumes and the highway capacity and precipitating congestion and traffic snarls... A report by the Federal High Way Administration noted that bottlenecks accounted for more than 243 million truck hours of delay annually... The extended travel time cost carriers $25 to $200 per hour. Without major investments, 42 percent of the national highway system will be congested during the rush hour and 29 percent during the off-peak hours by 2020. The impact this will have on container trucking will be horrific... A report by the US Department of Transportation to Congress pegged the cost of maintaining the highways at $91 billion a year with the cost escalating to $197.9 billion if improving highways and bridges is considered. Yet, the government has allocated a little over $33 billion, a shortfall of $58 billion on maintenance alone... Doug Sampson, senior vice-president of logistics company Acme Distribution said: "The increase in the capacity of the East Coast ports is only a part of the solution. In addition, we'll need to continue to search for ways of expanding our highway capacities and infrastructure and the government must assist in funding that additional capacity"... Yet no solution is in sight and the situation is expected to deteriorate as US-world trade grows. Imports are expected to surge from the current 18 million to 60 million TEUs by 2024... And the big question being asked in US shipping and intermodal circles is how will this freight be accommodated?

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