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Forward-Thinking Moves

Editorial: In trying times, Port of Virginia investments prove their worth

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Port of Virginia

In 2021, ports across North America battled all sorts of delays and congestion issues.

On the East Coast, thousands of shipping containers sat idle in Savannah, Georgia, without ships or trucks available to move them. On the West Coast, two ports in California dealt with their own backlogs: Long Beach and Los Angeles faced a record number of shipments, coupled with a shortage of chassis — a key tool that helps truck drivers transport freight.

“As major ports contend with a staggering pileup of cargo, what once seemed like a temporary phenomenon — a traffic jam that would eventually dissipate — is increasingly viewed as a new reality that could require a substantial refashioning of the world’s shipping infrastructure,” said an October 2021 New York Times dispatch from Savannah.

Thanks to some forward-thinking moves, the Port of Virginia largely avoided those kinds of challenges. Amid trying times for global supply chains, a series of strategic investments by the commonwealth are proving their worth.

In January, the College of William & Mary’s Raymond A. Mason School of Business released a study assessing the economic impacts of the port. In fiscal year 2021, cargo moving across terminals supported 436,667 jobs (+10% since FY 2018), $100.1 billion in spending (+8.7%), $27.2 billion in labor income (+17.8%) and 2.7 billion in state and local taxes and fees (+28.6%).

How did the Port of Virginia net such growth amid a historic pandemic and supply chain crisis that handcuffed the productivity of its competitors? Over the past few years, the port has prioritized more than $1 billion to expand terminal capacity, install semi-automation technologies, procure state-of-the-art cargo handling equipment and more.

“Part of competing and winning is the clear reality that the states around us are competing every day,” Gov. Glenn Youngkin said Tuesday at the Virginia Governor’s Conference on Agricultural Trade in Richmond. “Every day. And so we have to make sure that we are keeping up.”

The Port of Virginia has followed that vision. In terms of equipment, officials have honed in on the chassis issue and hold a unique advantage. In October 2021, the Journal of Commerce explained how the Virginia Port Authority owns and operates its own pool of chassis, which helps handle spikes in imports. By the end of 2022, the port also will have added 6,100 chassis to its fleet, supporting efficient movement between trucks and containers.

Virginia also has added ship-to-shore cranes capable of handling all kinds of ultra large container vessels (ULCVs). Two of these cranes arrived in March at Norfolk International Terminals (NIT), increasing the port’s total to 30.

In a statement, Port Authority CEO and Executive Director Stephen Edwards said since 2016, the port has added 1 million units of lift capacity. By optimizing and modernizing these resources now, Virginia is positioned to handle multiple ULCVs at once going forward.

“This benefits the port’s users and it says, very clearly, to the ocean carriers and the industry that we are prepared to handle big ships and growing cargo volumes safely, swiftly and sustainably for decades to come,” Edwards said.

The port also has established its foothold as a leader in rail options, with double-stack transport connections through CSX and Norfolk Southern railroads. Work recently started on an $80 million expansion of NIT’s Central Rail Yard, which will help raise annual container lifts from 350,000 to 610,000.

At Tuesday’s ag trade conference, Tom Capozzi, chief sales and marketing officer for Virginia International Terminals, said roughly 35% of the Port of Virginia’s terminal business is done by rail, serving locations primarily in Midwestern U.S. markets. The next closest port on the East Coast completes about 22% of business by rail.

In the water, Virginia is inching toward completing a dredging project that will help the commonwealth reclaim the deepest East Coast channels. Capozzi said that while Virginia historically held that title, the Port of Charleston in South Carolina recently pursued upgrades to angle for the top spot.

More importantly, Capozzi added, the Port of Virginia also will widen its shipping lanes, becoming the first East Coast spot to support two-way traffic for ULCVs. This optimizes the time ships sit at dock and improves the flow of business.

“Today, if there’s a vessel of about 12,000 TEUs or more, we basically have to shut down the transit of the channel to allow that vessel in and out of the harbor,” Capozzi said. “As you can imagine, that causes great delays for our berth utilization at our facilities.”

While “berth utilization” is not a term heard while shopping for groceries or waiting for packages, it matters. Youngkin is right that the commonwealth has to keep up; and Port of Virginia officials should be credited not just for moves that led to a solid 2021, but for ongoing investments that will prove their worth in the years to come.

— Chris Gentilviso

Chris Gentilviso is Opinions co-editor. Contact him at: cgentilviso@timesdispatch.com

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