Short Sea Shipping Initiative

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Short Sea Shipping Initiative Presented at
FHWAs Talking Freight Seminar December
17, 2003 Carl J. Sobremisana U.S.
Maritime Administration
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Presentation Outline

• Introduction and Description of Maritime
  Administration (MARAD) and Short Sea Shipping
  (SSS) Initiative
• Lessons Learned from European SSS
• Overview of U.S. Waterway System
• Needs and Activities of SSS
• Challenges and Accomplishments
• Conclusions and Recommendations

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U.S. Maritime Administration

• Mission

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History of Short Sea Shipping (SSS)

• SSS in the Western World began between 1200 B.C.
  and 900 B.C. by the Phoenicians in the
  Mediterranean Sea and in the U.S. in 1600 A.D.
  along the East Coast.

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Working DefinitionSSS is defined as
commercial waterborne transportation that does
not transit an ocean. It is an alternative form
of commercial transportation that utilizes inland
and coastal waterways to move commercial freight
off already congested highways, thereby providing
more efficient and safer roadways for car
passengers while alleviating congestion at
critical choke points. A secondary effect of SSS
would be reduction of air pollution and overall
fuel consumption through economies of scale.
Without building more highways, SSS can provide
additional capacity with the National
Transportation System through greater use of
waterborne carriage and can enhance linkages to
our North and South American trading partners.
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Lessons from North Europe

• Short Sea Shipping strong and growing
• Reduces road congestion
• Economizes on fuel reduces pollution
• Viable services require
• reliability
• high frequencies
• short transit times
• imaginative infrastructure

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U.S. Waterway System
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U.S. Army Corps of EngineersNational Data Center
- National Waterway System
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Top Gateways for International Freight Exports
and Imports in Tons
Source Federal Highway Administration
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Water transportation is efficient
This ONE barge is equal to...

• 25,000 miles of inland and coastal waterways
• Waterways connections to 152,000 miles of rail
• Waterway links to 460,000 miles of pipelines
• Port connections to 45,000 miles of interstate
  highways

180 Trucks
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Distance covered per cargo - tonwith the same
quantity of fuel
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Port of Portland Terminal 5
Barges and deep-seavessels are worked on the
same wharf with the same cranes
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Barges in Portland
Source JWD Group
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Matson Barge for Hawaii Service
Source JWD Group
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SSS New Development Activities

• NY- NJ Port Inland Distribution Network
• MARAD High Speed Ferry and Coastwise Vessel
  Studies
• State of Florida Intra-coastal and Inland
  Waterway www.dot.state.fl.us/publictransportation/
  Documents/WaterwayStudy/WaterwayStudy.htm
• Gulf of Mexico and U.S. Short Sea Shipping
  www.gomsa.org

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Drivers of Success for Short Sea Vessels

• Line haul vessel costs, costs at origin, costs
  at destination
• Adapt vessel to land rather than vice versa
• Environmental, Safety, and QOL Factors
• Policy Focus and Incentives

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TAKING A FRESH APPROACH Port Inland Distribution
Network A Port Authority of New York / New Jersey
Concept
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TAKING A FRESH APPROACH DELTA IV ROCKET TRANSPORT

• A SPECIALIZED VESSEL DESIGNED TO CARRY ROCKETS
  FROM THE INLAND WATERWAY STYSTEM TO CAPE KENNEDY
• Operates in Shallow Rivers and Low Bridges.
• Also carries commercial cargo

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Why the U.S. needs SSS?

• - Congestion increases for passengers and
  freight
• - Air pollution increases in urban areas
• - Accidents increase Surface truck traffic in
  mix with passengers causes safety issues
• - Economic growth relies on a smooth flow of
  goods
• - Existing infrastructure cannot handle the
  increases
• 1. Not integrated
• 2. Highway centric
• 3. Aging infrastructure
• 4. Not set up for urban population increases
• 5. Transport nodes are in urban centers

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GROWTH BY REGION US INTER INTRA-REGIONAL
TONNAGE GROWTH TO 2020
Source Federal Highway Administration
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THE ISSUES

• U.S. global maritime trade expected to double by
  2020
• 10,000 more trucks per day projected on the I-95
  corridor
• Cost of expanding U.S. highway system is
  significant
• New highway can cost 32 Million per lane
  mile New highway interchanges can cost over 100
  million

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Challenges to SSS
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THE CHALLENGE USE ALL ELEMENTS OF THE
TRANSPORTATION SYSTEM TO MEET GROWING DEMAND
Projected highway congestion in 2020 Source -
Federal Highway Administration
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US/Mexico Truck Traffic on US Highway Network,
2020 (Tons)
Source Federal Highway Administration US
Department of Transportation
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Market Challenges
1. Frequency One sailing per week
insufficient 2. Container size Domestic market
favored bigger boxes 3. Overweight containers 4.
Drayage expense to and from port facility
S.S. Manulani
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Shipping System Market Integration and Ship
Operating Challenges

• Formation of partnerships with trucking industry
• Implement single bill of lading interface and
  shore-side distribution systems
• Develop reliable schedules with trucking, rail,
  and/or ocean container connections
• Structure and implement low cost ship operating
  crew complement
• Source TRB Marine Board 2003 Spring Meeting

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SSS Challenges (Continued)

• Terminal Operational Challenges
• Federal Harbor Maintenance Tax, Stevedoring
  Costs, Terminal Location, Terminal Facilities
• Jones Act Challenges
• High Capital Costs of Ships and Crews
• Ship Financing Challenges
• Mitigating Financial Risks
• Source TRB Marine Board 2003 Spring Meeting

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Matsons Pacific Coast Shuttle
Successes and Snags in U.S. Short Sea Shipping
Distance/Transit TimeLos Angeles to Seattle
1,144 miles - 2.5 daysSeattle to Oakland
807 miles - 1 day, 16 hours
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MARAD SSS Accomplishments

• New York City SSS Conference
• Establishment of MARAD Task Force on SSS
• Creation of of SSS Cooperative (SCOOP)

• Sarasota, FL SSS Conference
• MOC with U.S./Canada/Mexico
• MOC with Gulf of Mexico States Accord (GOMSA) and
  Gulf of Mexico States Partnership

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International Cooperation on SSS

• MARAD shared information on SSS in the U.S. at
  the Pentaport Seminar to Develop the Port of
  Incheon as a Logistics Hub in Northeast Asia

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Conclusions
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National Freight Policy

• There is a need to establish an intermodal
  freight policy in USDOT that integrates robust
  SSS within the U.S. Marine Transportation System
• Educating the public-at-large, including state
  departments of transportation, metropolitan
  planning organizations, shippers, railroads, and
  truckers of the benefits of SSS

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Future SSS Initiatives

• Development of Partnerships with the Public and
  Private sectors
• U. S. Department of Transportation Strategic Plan
• MARAD Strategic Plan
• Creation of a MARAD SSS Program

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For further information contact

• Carl J. Sobremisana
• Secretary of the MARAD SSS Task Force
• [phone]
• E-mail carl.sobremisana_at_marad.dot.gov
• MARAD Web Site www.marad.dot.gov