A $35 million Port Milwaukee upgrade will accelerate activity
Challenges remain in big year for cruise ships
While congestion at ports around the country and the world has contributed to supply chain issues, Port Milwaukee has continued to operate at a high level.
“The port is an economic catalyst, an economic steward, and a recreational hub for the city of Milwaukee and the Great Lakes region,” Adam TindallSchlicht, port director, said.
Last year, the port handled 400 vessels coming and going, as traffic has been on an upswing.
In 2020, during the throes of the pandemic, the port handled 349 vessels, up from 274 in 2019 and 248 in 2018.
“The port has been able to prioritize safe, healthy and efficient operations during the pandemic,” Tindall-Schlicht said.
The port is in the middle of a major upgrade thanks to the DeLong Co.’s $35 million agricultural maritime export terminal, which will handle exports of Wisconsin-grown products such as corn and soy.
Tindall-Schlicht said it’s the largest one-time investment in the port since the 1950s and will increase the amount of metric tons handled by the port by up to 400,000 tons per year.
The port handled 2.3 million metric tons of goods in 2021, a slight decrease from 2.8 million in 2020. From 2019 to 2020 the port increased its international tonnage by 14% and grain tonnage by 82%.
“The increasing of exports from the port is a reality that I think we’re achieving, not just through Delong and the $35 million plus terminal ... but I also think about generational investment elsewhere in Milwaukee harbor,” Tindall-Schlicht said.
The port is operated by the city of Milwaukee and governed by the seven-member Board of Harbor Commissioners. Aside from receiving fees paid by private tenants and companies, along with $2.8 million allocated from the city in the 2022 budget, the port is funded through numerous grant programs at the state and federal level.
Also, Milwaukee World Festival Inc., the operator of Summerfest, paid slightly more than $1.6 million in 2021 to the city as part of its long-term lease of the Henry Maier Festival Park grounds, according to the port annual report.
Cruise ships make a return
And in May, cruise ships returned to the port after being absent since 2019. In February, around $6 million in improvements were announced at Port Milwaukee to accommodate large cruise ship traffic, including a $3.5 million state grant to expand maritime infrastructure.
Fourteen ships were scheduled to dock in the city before the pandemic struck in 2020, up from 10 the previous year and two to four ships in the years prior. This year, 33 ships are scheduled to bring 10,000 passengers to the city, up from 1,000 in 2018.
Jim Paetsch, Milwaukee 7 Economic Development Partnership executive director, said the port contributes to the local economy in ways many people don’t realize.
“There’s a lot of mining equipment that we make here in southeastern Wisconsin, that those pieces leave this region through that port,” said Paetsch, who also noted that wind energy components that go to Iowa or other Plains region states were shipped through the port.
Wood timbers for the 25-story Ascent building, 700 E. Kilbourn Ave., the tallest mass timber structure in the world, traveled to
Milwaukee through the port.
Paetsch said logistics and travel are becoming more important from a financial perspective.
“When we compete against other regions, (companies) are certainly going to be looking at things like talent cost, utility, the cost of real estate, access to supply chains and those kinds of things,” Paetsch said. “But logistics expense is increasingly a factor that companies reference to us and they do the math on the differences between us and the other locations that they’re considering.”
Paetsch said having the port in southeastern Wisconsin, “the economic center of the entire state of Wisconsin,” is another positive point for businesses considering the state.
“Having the port located directly within the city is really advantageous because it’s close to a lot of the ultimate users of those goods and also close to a lot of the manufacturing presence that also uses it to ship things out,” Paetsch said.
“Geography matters when it comes to the port.”
Lack of intermodal transportation options
But there are some changes that could be made to make the port more productive, particularly reinstating intermodal transportation.
Tindall-Schlicht said Canadian Pacific discontinued its intermodal transportation in 2012 and recently the port has been working to try to bring it back.
“Right now, in Wisconsin there is no publicly available intermodal container operation anywhere,” Tindall-Schlicht said. “For a manufacturer or a producer or a grower that needs to have access to a container for back-filled cargo, in order to get that empty container, that manufacturer, producer or grower must go to either Chicago, Minneapolis or Duluth to get that container.”
Paetsch said the Milwaukee 7 is working to convince companies to bring intermodal transport back.
“We are in regular conversations with the railroads about intermodal,” Paetsch said.
Infrastructure from the 1950s
Upgrades to other aspects of the port’s infrastructure eventually will be needed. The dockwalls, rail, buildings and terminals are currently in good shape, but over the next 50 years it will cost slightly more than $200 million to maintain that.
“Most of the infrastructure here at the port was built in the late 1950s and early 1960s to coincide with the opening of the St. Lawrence Seaway,” Tindall-Schlicht said.
“And our task in the decades ahead is not only to grow the port commercially, but to reinvest in the port strategically so the economic benefits of the commercial and recreational work can continue to grow.”
For the region to continue to attract business and for the state’s economy to grow, Paetsch said maintaining the port should be a priority.
“The port, I think, is certainly worthy of consideration for further investment to make sure that it not only remains competitive, but it continues to be an asset that allows us to bring more and more companies here,” Paetsch said.