Maritime Transportation and Inland Freight Distribution: The Challenge of the Coast

1. Maritime Transportation and Inland Freight Distribution: The Challenge of the Coast Dr. Jean-Paul Rodrigue Dept. of Economics & Geography Hofstra University Hempstead, NY http://people.hofstra.edu/faculty/jean-paul_rodrigue/

2. Outline • 1. Dislocation of Commercial Flows • 2. Coping with Economies of Scale • 3. Transforming Hinterlands • 4. Conclusion: The Challenge of the Coast

3. 1. Dislocation of Trade Flows • Differential growth • New origins and different growth rates for freight. • The kindness of strangers • Imbalanced trade and balance of payments. • What comes in does not come out • Imbalanced freight flows. • Going with the flow • A new reality for ports.

4. Share of Global GDP Growth, 1995-2002

5. Increases in U.S. Commercial Freight Shipments andRelated Growth Factors, 1993–2002

6. U.S. Trade in Goods and Services - Balance of Payments, 1970-2003 (billions of $US)

7. Containerized Cargo Flows along Major Trade Routes, 2000-2002 (in millions of TEUs)

8. Cargo Handled by the Port of New York, 1991-2003 (metric tons)

9. Container Traffic at Major East Coast Ports, 1990-2003 (TEU) 11 1 12 9 8 3 2 4 6 10 7 5

10. 2. Coping with Economies of Scale • A heavyweight tendency • Larger containerships. • Costs being externalized • Pressures on transshipment and inland distribution. • Dredge it and they will come? • The “race to the bottom”.

11. Five Generations of Containerships First Generation (1956-1970) Length Draft TEU 135 m 500 Converted Cargo Vessel < 9 m < 30 ft 200 m Converted Tanker 800 Second Generation (1970-1980) 10 m 33 ft 1,000 – 2,500 215 m Cellular Containership Third Generation (1980-1988) 250 m 3,000 11-12 m 36-40 ft Panamax Class 290 m 4,000 Fourth Generation (1988-2000) Post Panamax 275 – 305 m 4,000 – 5,000 11-13 m 36-43 ft Fifth Generation (2000-?) Post Panamax Plus 13-14 m 43-46 ft 5,000 – 8,000 335 m

12. The Largest Available Containership, 1980-2000 (in TEUs)

13. Fourth Generation Containership (4,000 TEU), Le Havre

14. Average Cost per TEU by Containership Capacity and By Route, 1997

15. Economies and Diseconomies of Scale in Container Shipping Transshipment Costs per TEU Inland Transportation Maritime Shipping Capacity in TEU

16. Channel Depth at Selected North American Ports, 1998 (in feet)

17. Intermodal Facilities and Navigation Channels of the Port of New York, 2003 Albers Equal-Area Conic Projection East River 40 45 Hudson River 1- Port Newark 2- Port Elizabeth 3- Global Marine 43 Newark Bay Channel 40 Red Hook 40 1 3 Upper Bay Channel South Brooklyn 2 45 Brooklyn 45 Daily Truck Movements (one way), 2001 37 Kill Van Kull Channel Howland Hook New Jersey 45 37 Arthur Kill Channel The Narrows Staten Island Navigation Channel Ambrose Channel 45 45 30 Control Depth (feet) Main Ship Channel N Intermodal Terminal 37 Arthur Kill Channel 37 Container Port (proposed) Raritan Bay Channel Major Highway Proposed rail tunnel

18. 3. Transforming Hinterlands • The flexibility and adaptability of supply chains • Growing functional integration. • Between a port and a hard place • New hinterland structures. • The intermodal coast • Regionalization and modal shift.

19. Functional Integration of Supply Chains Maritime Distribution Land Distribution Custom Agent Shipping Agent Trucking Rail / Trucking Freight Forwarder Stevedore Shipping Line Depot Economies of scale Megacarrier Level of functional integration

20. Changes in the Relative Importance of Logistical Functions in Distribution Systems

21. Phase 2: Penetration and hinterland capture Phase 1: Scattered ports LAND SEA Phase 4: Centralization Phase 3: Interconnection & concentration Phase 6: Regionalization Phase 5: Decentralization and insertion ‘offshore’ hub Freight corridor Load center Interior centre Deepsea liner services Regional load centre network Shortsea/feeder services The Spatial Development of a Port System

22. Pendulum Route: OOCL Container Services on the North Atlantic, 1997 Atlantic Ocean Boston New York Norfolk Bremenhaven Savannah Felixstowe Jacksonville Houston Miami NAX-1 Rotterdam NAX-2 Le Havre

23. National Trade Areas, Articulation Points and Major Land Freight Gateways of the United States Articulation Point Land Freight Gateway Trade Area Corridor

24. Continuous and Discontinuous Hinterlands Discontinuous hinterland Port A Port A Continuous hinterland Port A 'Island' formation Discontinuous hinterland Port B Port B Continuous hinterland Core of the service area Middle section of the service area Outer section of the service area Port B Maritime load centre Inland terminal

25. Port Inland Distribution Network Albany Syracuse Boston Hartford / Springfield Worcester / Framingham Davisville New Haven I95/New Jersey New York Reading Potential Regional Barge Port Philadelphia Hanover Inland Rail Terminal Wilmington Camden LO/LO Barge Service Inland Rail Route Baltimore Freight Cluster Washington

26. Potential Modal Split Changes Due to the PIDN

27. Modal Split for Container Traffic, Rhine Delta, 1995-2000

28. The Rhine Delta Port System: Mature Regionalization Harlingen Groningen Leeuwarden Veendam Drachten Seaport in Rhine-Scheldt Delta Alkmaar Meppel Inland Container Terminal (barge or multimodal) Zaandam Beverwijk Kampen Almelo Amsterdam Hengelo Growth region European Distribution (outside seaport system) Netherlands Hillegom Utrecht Ede Zutphen ROTTERDAM A. a/d Rijn Delta seaport system with multi-zone polarisation Valburg Nijmegem Gorinchem Oss Germany Oosterhout Emmerich Den Bosch Duisburg Moerdijk Tilburg Gennep Zeeland Seaports Dortmund Krefeld Zeebrugge ANTWERP Helmond Venlo Duesseldorf Deurne Ostend Neuss Meerhout Ghent Dormagen Born Genk Willebroek Cologne Wielsbeke Stein Grimbergen Bonn Belgium Brussels Avelgem Liège Lille Andernach Valenciennes Koblenz France Mertert Lux

29. Conclusion: The Challenge of the Coast • A changing geography of maritime and inland distribution • Global changes: • New geography of production. • Imbalanced trade flows. • Regional gains: • Consumption and distribution. • Local pains: • Congestion. • Stressed capacities. • The challenge of the coast • Port regionalization. • Modal shift: readjustment of freight flows. • Efficiency in distribution derived from the hinterland.