The Port of Baltimore is hoping to benefit from peace in the Persian Gulf.
Those hopes were lifted by the announcement yesterday that Lykes Bros. Steamship Co. Inc. will increase its monthly calls to the Port of Baltimore by adding a direct service from Baltimore to ports in Saudi Arabia and Egypt. The service expects to handle both military cargo from Operation Desert Storm and commercial cargo.
In a separate development, a trade journal reported that a subsidiary of CSX Corp. is to be the exclusive worldwide overseer of the Kuwaiti government's massive plans to transport supplies and equipment to rebuild its nation.
CSX, based in Richmond, Va., confirmed that it has an agreement with the Kuwaiti government for the limited purpose involving transportation of "emergency relief materials." But the company, citing a confidentiality agreement, would not elaborate further on the contract.
Port Director Brendan "Bud" O'Malley said Baltimore has been working with CSX officials and expects to play a major role in directing cargo to Kuwait.
Although unable to predict the exact amount, state officials said yesterday that Baltimore can expect to see increased cargo flowing to the Middle East as a result of the Lykes announcement.
"The bolstered Lykes presence will strengthen the position of the Port of Baltimore for handling the variety of reconstruction cargoes which will inevitably flow to Kuwait in the post-war period," said Gov. William Donald Schaefer.
"We see a strong need for American-flag, direct, timely service from the U.S. East Coast to the Arabian Gulf and Indian Ocean," said Roger L. Clark, senior vice president, Mediterranean Services, for Lykes. "We can provide that service with Lykes vessels, and American crews, along with service to the Mediterranean."
Lykes operates conventional service to Mediterranean ports in Morocco, Tunisia, Turkey and Egypt to Baltimore every 30 days. The line also provides three container services between the United States and South America, the Mediterranean and the United Kingdom and Northern Europe.
Lykes has provided service to Baltimore for the past 40 years.
Lykes is based in New Orleans and operates a fleet of 30 vessels, including 12 cellular container and 18 multi-purpose ships.
The new service will be a single-ship operation with a 45-day turnaround. The first call will be the Allison Lykes during the first week of March at the Dundalk Marine Terminal.
Clark said cargo demands to the Middle East have been steadily increasing. "We will be able to meet not only those immediate needs, but more importantly the long-term needs of our customers in the East Mediterranean and the Middle East."
O'Malley said the Port of Baltimore is looking to play a major role in the shipment of goods for the reconstruction of Kuwait. Since the war began, military cargo shipments have been bTC disappointingly low and confined mostly to foodstuffs, he said.
"We think we are positioned well for the Kuwaiti rebuilding," O'Malley said.
Shipping lines making calls to the Middle East received good news yesterday with the announcement that the Lloyd's of London insurance market slashed insurance rates for marine and air cargo traveling to many Middle East locations. O'Malley said that news should encourage lines serving the Middle East to continue or expand their operation.
Baltimore also is hoping to capitalize on the contract that a CSX subsidiary has with the Kuwaiti government. According to reports published in the Journal of Commerce, the subsidiary -- CSX/Sea-Land Logistics Inc. -- will coordinate cargo transport on shipping lines, airlines and ground vehicles.
CSX/Sea-Land Logistics will ship cargo both with other CSX subsidiaries and with unrelated carriers. Freight has already moved under the contract.
CSX is the parent of Sea-Land Service Inc., the largest U.S. containership line.