Baltimore wants piece of boom in Asian cargo

The port of Baltimore isn't up the Chesapeake Bay without a paddle. It's got Richard Powers, a new marketing director, to sell the port's geography as an asset, not a liability.

Port Of Baltimore

October 03, 2004|By Meredith Cohn | Meredith Cohn,SUN STAFF

As American appetites for Asian-made DVD players, cars, clothes and other goods grow in coming years, trans-oceanic traffic is expected to boom -- possibly doubling the amount of cargo through U.S. ports by 2020.

With all this new and hotly contested business up for grabs, largely in 20-foot metal containers from China, the port of Baltimore does not appear to have geography on its side. It's on the East Coast and a half-day's trip up the Chesapeake Bay.

But with thousands of port-related jobs and a hefty piece of the local economy on the line, port administrators, including a new marketing director, say they must persuade the world to see the map differently.

They want to build on the port's years-long plan to entice niche cargo such as luxury cars and paper products. But they also want a larger share of more traditional container cargo that often goes to other ports.

"The bay is what it is," said Richard E. Powers Jr., the marketing director, in a recent interview a little over a month into his job. "We can't change it. We have to focus on what's within our control."

Ships sailing to Baltimore must pass by Norfolk, Va., a top competitor for the proliferating and revenue-rich containers. Baltimore already lags behind it and at least a half-dozen other East Coast ports for this business.

What's within Powers' control is perspective.

Baltimore is the major port for the nation's fourth-largest consumer market, which includes Washington. And it is the closest East Coast port to the Midwest.

What with Los Angeles getting so congested that ships must wait days to be unloaded, why don't cargo vessels sail through the Suez or Panama canals to the East Coast and get products more quickly onto trucks or trains headed west?

That's the story Powers will sell in coming years to retailers that rely on Asian products such as Wal-Mart Stores Inc. and IKEA International A/S. It is also a line to sell carriers that need more efficient and less crowded routes.

Other East Coast ports are heavily marketing and investing in land and equipment to handle the growing loads from Asia. And as they win over more carriers, the Panama Canal is getting clogged.

Fred Duiven, a port industry analyst for Booz, Allen Hamilton Inc., said Baltimore can still go after Asian cargoes, but more likely the kind that are not shipped in containers, such as automobiles, which is already a big business here.

The port also can go after other business, including cars, squeezed out of other ports such as those in New York and Virginia as they attract more containers.

"Containers are a key part of the industry," he said. "Other cargo is not as attractive from a revenue standpoint, but it does bring jobs. But to say you're not going to be a successful port without containers is just not right, because you can make a nice business with other things."

And, he noted, Baltimore has a steady, though not vastly expanding, container business. Mediterranean Shipping Co., the world's second-largest container carrier company, has been growing its presence in the port since 1990.

That contributed to a total port portfolio that brought in $216.2 million in state and local taxes and $1.47 billion in business revenue in 2002, according to the latest economic impact report prepared for the port by Martin Associates of Lancaster, Pa. The report also said the port directly employs 15,740 and that potentially thousands of other jobs rely on it.

A strategic plan developed in the 1990s directs the port to build on strengths, namely, the noncontainerized cargo headed to and from Europe, the Middle East, Latin America and, to a lesser extent, Asia.

James J. White, executive director of the port administration, which oversees the state's public marine terminals, said officials have followed the plan and are pleased with their success in nontraditional cargo.

Sometime in the mid-1990s, Baltimore discovered it was the No. 1 East Coast handler of ro-ro cargo, items that can roll on and roll off ships such as construction and farm equipment. And in the early part of 2003, it became the No. 2 East Coast handler of automobiles. It also is a leader in paper products.

Other ports don't have the space, equipment or training to handle these niche cargoes. But Baltimore has made the space, trained the workers and has the equipment.

Port officials have also worked with economic developers to make space for distribution centers, expanded highways and parking lots in an effort to lure all kinds of business.

Officials at the Swedish furniture giant IKEA said the available land near the port was a prime reason for opening one of the state's largest distribution centers in Perryville in 2002.

And geography, often the bane of the port, has been given as the reason several companies chose Baltimore over another port.

Deere & Co. of Moline, Ill., exports farm equipment through Baltimore. Asian and European carmakers, such as Hyundai and Jaguar, import through Baltimore to reach the U.S. heartland.

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