Ports of Seattle and Tacoma Team Up to Compete With Canadian Gateways

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October 7, 2014

Port of Seattle, image (c) Stefan Wolczko

By Peter Robison and Christopher Donville

Oct. 7 (Bloomberg) — The ports of Seattle and Tacoma, Washington, said they will unify management of marine cargo terminals amid heightened competition from Canadian gateways.

The alliance will oversee investments, operations, planning and marketing at cargo terminals, the ports said in a joint statement today.

“We’ll be able to plan our investments in port infrastructure strategically,” Stephanie Bowman, co-president of the Port of Seattle Commission, said at a news conference in Renton, Washington. This will help the ports “meet demand without overbuilding.”

The ports of Seattle and Tacoma began talks this year on finding ways to work together to attract more shipping to Washington’s Puget Sound. The effort follows volume gains in Vancouver and Prince Rupert, British Columbia, at the expense of some U.S. ports.

“They’re eating our lunch,” U.S. Representative Jim McDermott, a Democrat from Washington, said in an interview yesterday. He said he’s long been an advocate of closer cooperation between the Tacoma and Seattle ports. “That should have happened 30 years ago.”

Volume at the Port of Seattle dropped 26 percent from 2010 to 2013 to 1.6 million standard containers, or 20-foot equivalent units, known as TEUs, according to its website. The Port of Tacoma’s volume is almost unchanged since 2008, at about 1.9 million TEUs.

Unprecedented Change

“In the past decade, there has been unprecedented change in the global shipping industry and billions of dollars spent by Canadian ports in Vancouver and Prince Rupert to improve their port facilities,” Bowman said. “This means we can no longer do business as usual.”

The U.S. Department of Transportation said yesterday that it would award the Port of Seattle $20 million to refurbish Terminal 46, allowing it to simultaneously serve two super post- Panamax vessels, as ships designed to cross an expanded Panama Canal are known.

“It’s not enough,” U.S. Transportation Secretary Anthony Foxx said at a Seattle press conference, noting that many ports across the U.S. need to be modernized in the face of overseas competition.

A Caterpillar Inc. president testified to Congress in January that it now moves 40 percent of imports and exports through Canadian ports, partly because those in the U.S. lack capacity for the biggest ships and aren’t integrated well enough with rail and road networks.

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