Port Canaveral: Port Canaveral this week broke ground on what will soon be the port’s first multimodal inland facility, part of the Florida port’s ongoing campaign to snag container traffic from other U.S. East Coast ports.
Come 2016, the Canaveral Port Authority is to be the first tenant at Flagler Global Logistics’ Titusville Logistics Center, having inked a landmark build-to-suit lease agreement for the 246,240-square-foot complex last year.
Close to Space Coast Regional Airport and short drive from Port Canaveral, the Titusville Logistics Center’s strategic location, combined with direct rail connectivity to the Florida East Coast Railway and easy access to nearby highways, should provide an attractive package for shippers, according to port officials.
Today, Port Canaveral’s container traffic is virtually nonexistent. The port is best known for its thriving cruise business, second only to Miami in passenger volume, and its eclectic collection of petroleum, dry bulk, breakbulk and other cargoes. John E. Walsh, CEO of Port Canaveral, plans on changing that.
“Our new inland port facility is a critical step in the port’s overall expansion plan to attract more container business and elevate our strategic value within the national supply chain by offering a more cost-saving, efficient route to move goods throughout the southeast,” Walsh said in a statement.
The CEO has said the port’s container traffic could soar to 3 million to 4 million 20-foot-equivalent units within 15 years. It’s an ambitious goal, considering Savannah, the busiest container port in the Southeast U.S., handled 3.3 million full and empty TEUs last year. Port Tampa Bay, on the other side of Florida’s Gulf coast, handled less than 50,000 TEUs in its most recent fiscal year.
The port, though, has taken some significant steps toward realizing that overall expansion plan already this year.
In early June, the port dedicated the site of a new container terminal where United Arab Emirates-based Gulftainer will initially operate on 20 acres, using two refurbished second-hand cranes purchased from the Georgia Ports Authority. Although starting small, the port authority has said there are options to add 80 acres, and plans to eventually to develop a 500-acre terminal on leased Navy property, Walsh said.
Walsh has said container present an opportunity for the port to make a name for itself in a segment where it already has a competitive advantage: a three-mile channel to a uncongested location within a short truck drive of growing Florida markets; 46-foot channel depth that the port plans to deepen to 55 feet over several years; terminal management by global port operator Gulftainer; and a plan for “vertically integrated” logistics services including port, distribution center, trucking and intermodal services.
“When we started looking at the economics — what’s growing, what’s not growing — we knew we needed to be in containers,” Walsh said in June.
Port Canaveral plans to achieve its goals without poaching other Florida ports’ business. Walsh has said. Instead, Canaveral expects to grab a share of the Florida cargo that now moves through other states’ ports. It’s a sizeable share. According to a study commissioned by the Florida Ports Council this year, roughly 50 percent of containers entering Florida and 30 percent of containers leaving Florida move through ports in other states. That’s “low-hanging fruit” for Florida ports to capture, the study concluded.
It’s the same conclusion that Walsh appears to have reached, but he’s not alone.
Other Sunshine State ports, that already have the terminals and facilities to support a growing container business, are also gearing up to capture those containers. More than $1 billion of capital infrastructure projects are already in place in Miami, where port officials are counting down the days until a $205 million dredging project is expected to be completed this summer.
Last month, Port Everglades received long-awaited federal approval for a $374 million deepening project that will allow it handle larger container ships. And now Port Manatee appears is poised to take advantage of its own location, deep channel and undeveloped property after the port received $700,000 in federal funding for a study on its plans to deepen its 40-foot channel to between 45 and 50 feet.
Canaveral is already a late entrant to the high-stakes container port game and it faces other headwinds as well: the port is challenging well-established competitors that won’t easily yield market share; the port’s location on the Florida peninsula may limit its inland intermodal reach; and it’s attempting an abrupt about-face in its business strategy. Port officials and developers remain undaunted.