On expansion for Georgia ports

The Georgia Ports Authority, never shy when pushing for growth, is embarking on an ambitious plan to extend by rail and by road the reach of its distribution points into the Mid-west. The idea is to help customers move goods over to Memphis, up to St. Louis and Chicago, and into the Ohio River Valley at Columbus, Ohio.

This means connecting the two rail yards in Garden City to each other, thus creating the largest rail facility on the East Coast and doubling capacity over the next three years, GPA’s new executive director, Griffith Lynch, said in the authority’s annual State of the Port address.

There will be an inter-modal Appalachian Regional Port on 42 acres in Northwest Georgia’s Murray County. To carry 25 trains a week into the so-called Mid-America Arc will take 4,700 miles of rail.

At the same time, deepening the Savannah Harbor to make room for giant new cargo ships is set for 2020 completion.

Plus, interstate and highway improvements locally, around Macon and in Atlanta are under way to ease truck access and reduce traffic congestion, for example, with trucks-only lanes on I-16.

Then there are a smattering of more efforts to reduce pollution and improve services to the wide range of customers that move goods through the five deep water ports of Savannah and Brunswick. It’s enough to take the breath away.

Beyond the impressive vision that these plans represent, just as impressive is how the GPA has shown it can pull together the governmental, quasi-governmental, corporate and labor partners needed to make these plans real.

Savannah’s port, the second-busiest on the East Coast, already has a robust 7-percent growth rate. In all, Georgia’s ports help generate 370,000 jobs across the state, including 40,000 locally.

Trying to maintain that pace won’t be easy. But local and state leaders must continue to make that effort.

There are cautionary notes as the GPA attempts this leap. Even without these expansions, shippers are already in need of warehouse space to put the goods they carry into and out of Savannah’s port. Existing space has a vacancy rate of less than 2 percent.

Lynch urged private investors and developers to build speculative warehouses, saying 21,000 acres in the four counties closest to the Savannah port are ready for development. “We have more and more companies coming to talk to us about doing business with our port. The last things we want are missed opportunities because we don’t have the space available,” Lynch said.

Building for even more growth without warehouse capacity to match it could be a costly mistake. And beyond the alreadyprepped acreage available, future development must continue to take a responsible view toward environmental and quality of life consequences.

Growth must also be calibrated to account for fluctuations in the global shipping industry, which is still suffering a significant downturn.

Cargo shippers overbuilt their capacity only to hit the 2008 recession and a drop in consumer demand. This led Hanjin, the container line out of South Korea, to file for reorganization as industry watchers speculate more major shippers will follow suit.

The slump is prompting European banks, especially German banks, to try to unload tens of billions of dollars in now-shaky loans to ship-owners, according to Reuters.

Regardless of how many carriers remain after the correction for over-building capacity, goods will keep moving, and keep coming into and out of Savannah, and local and state leaders must keep their eyes focused on the prize: a thriving port that provides a huge boost to the region’s and state’s economies.

Global downturn or not, fiscal 2015 saw a 17-percent hike in cargo shipping through the Garden City terminal, mostly because Georgia ports grabbed shipments diverted from West Coast ports shut down over labor disputes. GPA says it’s retaining a chunk of that business, which speaks volumes about the healthy relationship between management and labor at the state’s ports.

The GPA has proven its ability to grow while other segments of the industry shrink. It was the last to suffer and the first to recover from the recession.

Population growth in the southeastern U.S. drives more consumer demand for imports, while business growth boosts exports.

By extending its reach over to the Mississippi River, the GPA hopes to entice more business from West Coast ports as well as open more overseas markets to American businesses in our nation’s heartland. The larger ships coming into Savannah at lower on-water costs make that possible.

There’s no question that the leadership and vision by authority officials, Gov. Nathan Deal, state legislators, and leaders in labor and business have made Georgia’s ports major drivers of the state’s economy and are poised to keep pushing. Mike Lester, Washington Post Writers Group