THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Monday, January 23, 1995 TAG: 9501210100
SECTION: BUSINESS WEEKLY PAGE: 4 EDITION: FINAL
SERIES: Forecast '95
SOURCE: BY CHRISTOPHER DINSMORE, STAFF WRITER
LENGTH: Medium: 74 lines
In the wake of a resurgent world economy, the port of Hampton Roads had a record 1994 and 1995 looks to be even better.
After a sluggish 1993, cargo shipments through the port boomed nearly 16 percent last year in terms of tonnage, thanks to recovering economies in Europe, South America and elsewhere.
Shipping lines serving the port also added seven new services over the course of last year, which will help boost tonnage even more in 1995.
Maersk Lines began the new year by consolidating even more service to Hampton Roads in a deal that could bring an additional 10,000 containers a year through the port, which handled more than 800,000 containers last year.
But port leaders are cautious.
``We can't afford for one minute to rest on the success we've had,'' said Joseph A. Dorto, general manager and chief executive of Virginia International Terminals Inc., which operates the three terminals owned by the state.
Competition between East Coast ports is stiff and Hampton Roads has to keep its guard up. The port directly or indirectly supports over 100,00 jobs in Virginia.
Port terminal owners, shipping lines and stevedoring companies are trying to negotiate an agreement with the International Longshoreman's Association to make it more competitive on the break-bulk side of the business.
Break-bulk cargo, such as rubber, which moves on pallets rather than in containers, is labor intensive. The port relies on a healthy volume of break-bulk business to keep its costs down for container business.
But most of the port's key break-bulk cargos - cocoa beans, rubber and plywood - declined substantially last year. Competing ports are offering the break-bulk lines better deals than they can get in Hampton Roads.
``We have been told by the Waterman Steamship Line that brings a considerable amount of rubber in here that they are considering leaving if we do not get concessions,'' said Johnnie J. Johnson, president of the Hampton Roads Shipping Association and chief negotiator for the port in its talks with the ILA.
Waterman had a meeting with officials from the port of Wilmington, N.C., in early January, Johnson said.
The ILA rejected a package of concessions in August and the talks recently turned to starting an apprentice program in which new workers earn $15 an hour, compared to the $21 an hour most longshoremen currently make.
``If we can do what we're trying to do, this program could give the port the same kind of economic benefits that concessions would have,'' said Ed Brown, Hampton Roads vice president of the ILA.
Whatever happens with the break-bulk talks, the port is on course to have a strong year on the container side. The port could handle its millionth container in a year this year, up from 894,000 last year.
General cargo tonnage, which includes both containers and break-bulk, soared 16 percent to nearly 8 million tons.
Coal shipments, the only smudge on 1994, are likely to rebound in 1995. Coal loadings at the port's three coal terminals were slightly down in 1994 and still substantially below loadings in 1992.
Coal exports were hurt by a weak international economy and stiff competition from coal mines in South Africa, Australia and elsewhere.
It will be some time before we get back to the export figures we saw in 1990 and '91, but demand has started to increase worldwide and U.S. coal is priced competitively,'' said William B. Bales, a coal marketing executive at Norfolk Southern Corp., which owns the Lamberts Point coal terminal in Norfolk.
Bales said Norfolk Southern expects modest growth in coal shipments throughout 1995.
``There's a more even balance of supply and demand in the world than there has been,'' he said.
KEYWORDS: SHIPPING ECONOMY PORT CONTAINER SHIPPING CARGO by CNB