South Carolina Ports Authority head Jim Newsome said Monday that the Port of Charleston has bounced back to business levels of those before the Great Recession but that, to succeed, the authority must increase its earnings faster than at competing ports.
"We are, as I see it, in the second inning of a nine-inning baseball game. We scored in the first two innings but we have a long game to play," Newsome, the authority's president and CEO told several hundred representatives of the state's maritime industry during his annual State of the Port address.
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South Carolina is now the nation's ninth-busiest container port by volume. But earnings are not sufficient compared to other ports and return on capital expenditures must be above average, about 6 percent, in the next few years if the port is to have long-term success, he warned.
A look at how Newsome viewed the port in his sixth annual address:
— Newsome said that from 2009-2014 the port was repositioning itself and is now the ninth-busiest in the nation in terms of container volume. Between 2015 and 2020 he said the port will need above-market revenue growth and investment. For the following decade he sees growth sustained at the level of other ports.
— Newsome sees opportunity for growth in existing South Carolina and regional markets in automobile and tire exports as well as plastics and agricultural products. He expects imports to pick up as well, particularly in e-commerce where people order items online and they are shipped to this country.
— Newsome said he expects the Charleston Harbor to be deepened to at least 50 feet by 2019. A U.S. Army Corps of Engineers draft environmental impact statement reviewing the $300 million project is expected to be released next month.
— The authority is in the midst of a 10-year, $2 billion series of capital improvements. In addition to the harbor deepening, the list includes a new container terminal in North Charleston, the inland port that opened in Greer, South Carolina, last year, improvements at the Wando Terminal in Mount Pleasant, South Carolina, to handle a new generation of larger container ships and a new intermodal rail yard in North Charleston.
New Contract System
— Newsome said the authority plans to streamline the way it handles contracts with steamship lines. Currently costs are essentially a la carte with fees for every time a container is moved or stored. The new system will charge lines based on their overall volume meaning predictable costs for the lines and an increased incentive for the port to be more efficient.
— While the authority needs to invest in infrastructure, Newsome expects slower growth in the marketplace and more competition from ports in the Southeast. Large, low-cost tracts of land will be needed, particularly near the Interstate 95-Interstate 26 junction for loading and transshipping containers. .