Many businesses balk at digging deeper for shipping

January 16, 1991|By John H. Gormley Jr.

Waiting to take on cargo bound for Europe, the black and red hull of the coal ship Kasturba floated high in the water at its berth at the Consolidation Coal Sales terminal in Canton. Painted red below the water line and black above, the empty ship showed more red than black. But once the terminal's automatic loading device suspended over the deck began to spew tons of coal into the hatches, the red began to diminish as the hull gradually sank in the water.

"We'll just about cover the red paint," George McElroy, the terminal manager said, as the loading was about to begin. In fact, when the Kasturba left the following day, very little red paint was visible. The ship carried 75,000 tons of coal, or almost 9,000 tons more than was possible before the port's main shipping channels was deepened to 50 feet.

Thanks to the dredging, a lot less red paint is showing these days when coal ships leave the port. Before the project was finished late last year, ships could be loaded only to a depth of 41 feet, one foot less than the actual depth of the channels. That meant that a ship such as the Kasturba would sail with about 4 feet of red paint showing, representing a waste of a significant percent age of the ship's carrying capacity.

The economic benefits of the deeper channel are obvious. Ships leaving with more cargo earn more revenue for their owners. The deeper water also means that Baltimore can handle much larger ships than now frequent the port -- behemoths capable of carrying twice the load of a Kasturba. The combination of higher profits and bigger ships should lead to lower freight rates from the port, making Baltimore more competitive with other coal ports.

Benjamin F. Wilson, general manager of Lavino Shipping Co. in Baltimore, said the deeper channel system should have a dramatic effect on the economics of shipping bulk commodities. "That's going to have a tremendous impact on the cost per ton of pulling cargo out of this port," he said.

That's exactly what the nearly quarter of a billion dollars spent on the dredging project was supposed to accomplish for the port's bulk commodities -- coal, grain, iron ore and petroleum that often move in large, deep-draft vessels.

Yet, of all the bulk terminals in the port, only the two coal-export facilities have dredged their own berths and access channels to match the 50-foot depth of the main shipping channels. It's as though a railroad had been built at great public expense to the gates of an industrial complex and the owners of most of the factories declined to pay for the extension of the track to their loading docks. The train can get close, but not close enough to load or unload cargo.

The unwillingness of other port interests to spend their own funds to make their terminals compatible with the 50-foot channel raises the question of whether the project was worth the $237 million and two decades of studies and political battles required to build it.

"If no one dredges [their own terminals] to 50 feet, what the hell difference is it going to make?" asked Charles E. Scarlett, vice president of Ramsey, Scarlett & Co. Inc.

His company unloads ships that deliver iron ore to the terminal owned by CSX Transportation Inc. in Curtis Bay. Though he would like to see CSX dredge out the area around the ore terminal to improve operations, he doesn't think 50 feet is required. "We just don't bring in ships that big," he said.

He sees a brighter future for the port's coal terminals, which he thinks will prosper, aided by the deeper channels and rising prices for competing fuels. But he wonders who else will benefit.

Bethlehem Steel Corp.'s Sparrows Point steel plant appears to be one beneficiary. In 1989, the plant imported 7 million tons of iron ore, barely less than the amount of coal Consolidation handled at its terminal. Bringing in that much ore required about 110 vessel calls, or more than two ships a week.

Moreover, Bethlehem was one of the earliest and most enthusiastic supporters of the dredging project. Yet the company has not deepened its channels and berths.

The reason seems to be that Bethlehem simply doesn't have the money to spare. But the company still recognizes the economic benefits connecting to the 50-foot channel would bring. "The company feels we would realize a savings by bringing in fewer ships with heavier loads," said G. Ted Baldwin, a company spokesman. "It's under continual review."

Doing the work would cost several million dollars, said Mr. Baldwin, who observed that the company's current emphasis has been "to rigorously reduce costs," an emphasis expected to continue this year.

Though Bethlehem would seem a likely candidate to take advantage of the deep water at a later date, most of the other bulk terminals in the port don't see much immediate need for 50-foot channels.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.