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Charleston, SC - A bigger share of the South American market and rebounding exports are driving double-digit growth at the Port of Charleston.

Last year container volume through the Port of Charleston hit all time highs, reaching 1.48 million TEUs, up 16% from 1.27 million TEUs in 1998. Through the first quarter of 2000, container volume is up 17% to 391,000 TEUs, putting Charleston on a pace to top 1.5 million TEUs this year.

More than 40 container carriers serve 140 countries direct from Charleston, providing service diversity across trade routes, but Latin America has clearly been the dominant driver of this growth.

In 1999, Charleston's South America business jumped 75% to well over 140,000 TEUs, Caribbean trade doubled and Central America volume was up 30%. Latin American trade through Charleston has grown eightfold since 1991, increasing its share of Charleston's total port volume from 4% to 15%.

Behind Charleston's increasing Latin American market share are several factors. To serve the Southeastern market carriers have begun using Charleston in favor of traditional hubs in South Florida. This trend has intensified as carriers seek to consolidate east-west and north-south services in fewer ports, and as more capital investment from firms doing business with Latin America pours into the Carolinas and Georgia.

Charleston's Asia business, 28% of total throughput, is also strong with exports to Northeast Asia up 18% last year to nearly 140,000 loaded TEUs. Healthy exports of citrus products point to continued strength over the coming year. Imports from Northeast Asia increased 14% last year.

Inbound shipments from Asia, especially China, are expected to expand dramatically as more and more distribution centers are constructed in the region. This trend and local factors in West Coast ports are driving larger volumes of Asian goods all-water through the Panama Canal.

Although considered a "mature" trade lane, North Europe generated well over 40,000 TEUs in new business for Charleston last year and remains the port's biggest market at 36% of total. Machinery, chemicals, resins, paper products, and auto parts for manufacturers such as DaimlerChrysler and BMW continue to be dominant cargoes. The other bright spot has been Med traffic, which increased 14% in 1999 primarily due to outbound cargo, and now represents 10% of total traffic. Eastern Europe, the Middle East, Africa and the India subcontinent each account for 3% of total volume.

Charleston, SC - Peter O. Lehman, executive assistant to the president at the South Carolina State Ports Authority, has been elected vice chairman of the American Association of Port Authorities' Planning and Research Committee. AAPA was founded in 1912 and today represents more than 150 public port authorities in the Western Hemisphere.

Lehman has also been elected vice chairman of a national trade advisory group. The Industry Consultations Program is a joint initiative of the U.S. Department of Commerce and the U.S. Trade Representative. Lehman will represent industry views on the Advisory Committee on Small and Minority Business for Trade Policy Matters.

Lehman is a graduate of the New England School of Law, the American Graduate School of International Management (Thunderbird) and Stetson University. He joined the Ports Authority in January 1997 after serving as director of the South Carolina World Trade Center-Charleston.

Charleston, SC - The South Carolina State Ports Authority has named Lindy Rinaldi its Chief of Port Police and Matthew Pesavento its new regional sales manager in Atlanta.

Rinaldi joined the Ports Authority in 1988 after working for the Isle of Palms Police Department and the U.S. Coast Guard. In 1994, she was promoted to Captain. A graduate of Southern Wesleyan University and the South Carolina Criminal Justice Academy, Rinaldi is a certified basic instructor, firearms instructor and blood-borne pathogens instructor.

The SPA's Port Police Department provides 24-hour security to all cargo, waterfront workers, customers and facilities. The force consists of more than 50 officers, including two dozen certified officers and five U.S. Deputy Marshals.

Pesavento comes to the Port from SAGA Forest Carriers, where he was a traffic manager/assistant operations manager for in Norcross, Ga. Prior to that job he worked as an ocean export specialist with International Freight Forwarders in Atlanta and as an import specialist with International Forwarders in Charleston. He is a native of Beaufort, S.C., and a graduate of The Citadel.

Pesavento's territory will include inland Georgia, Tennessee, Alabama, Mississippi, Arkansas, Kentucky and the city of Cincinnati, Ohio.

NEW CRANES - To handle growing volumes and to more effectively use existing terminals, last month the S.C. State Ports Authority announced it would purchase six new rubber-tired gantry cranes from Konecranes of Finland for a total of $8.04 million. The SPA has ordered 15 of the same units over the past two years to optimize utilization of current facilities.

SPACE UTILIZATION - The Port of Charleston is currently 50% more efficient than the typical U.S. port when it comes to effectively using its land. This measure takes the total number of container TEUs, or 20-foot equivalent units, and divides it by the total acreage available for container storage. The North American average for TEUs per acre is 2,455. In the first quarter, the SPA achieved a utilization rate equivalent to 3,678 TEUs per acre.

EXPORTS REBOUND - The Port of Charleston is earning a reputation as the nation's export launching pad. In the final quarter of 1999, Charleston led all U.S. ports in containerized exports to
North Europe, the Mediterranean, Eastern Europe, South America and Africa. Strong exports have continued into 2000. In March alone, loaded export container volume reached an all-time record high of 62,401 TEUs, up 18% from the same month last year. Charleston handled a record 1.48 million TEUs in 1999, up 16% from 1998.

ASIA & INDIA SERVICES - Two new services will soon begin operating from the Port of Charleston. A joint weekly service of COSCO, Yang Ming and "K" Line will call Columbus Street last port outbound to East Asia through the Panama Canal. The joint fortnightly service of Shipping Corp. of India, Contship and CMA-CGM will initially call North Charleston every two weeks to India, the Mediterranean and the Mideast.

MEET SHIPPERS - Where can you find dozens of shippers in one place? At the 2000 South Carolina International Trade Conference, May 17 - 19 in the Riviera Theatre at Charleston Place.
Of the nearly 400 people already registered, 20% are manufacturers, importers and exporters. In addition great speakers, social events include a reception at the new S.C. Aquarium and a closing party at Boone Hall Plantation. For more information, call toll-free 877-347-3226 for registration details. All registrants are eligible to win a $5,000 Caribbean cruise.

WCSC POLL - An Internet "Pulse Poll" conducted recently by WCSC-TV revealed that the public favors port expansion by nearly a 2-to-1 margin. Of 35,000 votes, 65 percent responded "Yes" to the question, "Do you support port expansion on Daniel Island?"

BUSIEST HIRING MONTH - April was the Ports Authority's busiest hiring month ever, with 16 new employees in addition to the 14 new-hires in March. To fill other openings and address personnel needs, recruiting efforts have been bolstered.

NEW PORT POLICE CHIEF - Lindy Rinaldi was recently named Chief of the Port Police Department to replace Eddie Ott, who is retiring after 20 years of service with the SPA.

Charleston, SC - The South Carolina State Ports Authority supports passage of Permanent Normal Trade Relations with China.

Passage of PNTR is seen as necessary for the United States to realize the benefits of China's entry into the World Trade Organization. As a result of these discussions, China has proposed tariff stabilization and reductions on a variety of U.S. exports.

Especially of interest to the Port of Charleston's customers is China's 62% slash in tariffs on U.S. paper and paper products, which represent more than one half of all exports to China through Charleston. Other key sectors that would benefit are machinery, power generation equipment, fibers, medical equipment and poultry.

Charleston, SC - A South Carolina Senator recently introduced the State Ports Authority (SPA) Accountability Act, ignoring the role of respected business professionals on the SPA's Board and creating red tape for the public's most effective and successful economic asset.

Senate Bill 1330, introduced by Bill Mescher, would prohibit the SPA from entering into a permit process, land acquisition or construction contract or obligate the authority to undertake any other procurement for any project that is in excess of $5 million.

Currently these contracts are reviewed by the SPA Board, which is made up of respected business leaders from around the state. SPA Board members include very successful entrepreneurs, presidents of billion dollar corporations, recognized business leaders and accomplished attorneys who are appointed by the governor and confirmed by the Senate.

"This bill is an affront to the public servants and business leaders that have served our state on the Ports Authority Board," said Anne M. Moise, spokesperson for the SPA. "It basically
says that executives running billion dollar companies are incapable of making sound business decisions."

In addition, by requiring approval of the General Assembly for all acquisitions above $5 million, the bill would create bureaucratic roadblocks and slow what has arguably been the state's most effective quasi-state agency. The SPA has set global productivity records and has grown to become the nation's fourth busiest container port, handling $79 million in cargo every day.

Just last month the SPA ordered container stacking equipment totaling $8 million and has four cranes on order that are worth $26 million. These were direct responses to increasing port volume and the needs of manufacturers in South Carolina.

"It is contradictory for port opponents to call for more efficiency and at the same time stimulate bureaucracy," said Moise. "The State Ports Authority was created as an enterprise instrumentality,
allowing it to react to market requirements and customer needs. All across the state and nation taxpayers are seeking more effective government, but this bill would reverse the Ports Authority's ability to serve South Carolina."

Charleston, SC - After an all-time record month in March, Charleston is currently 50% more efficient than the typical U.S. port when it comes to land utilization.

Beyond crane productivity, or how many shipping containers can be loaded and unloaded from ships in an hour, ports can also be evaluated based on their effective use of land. While Charleston's crane productivity has been renowned for years, it is now making waves in throughput per acre. This measure takes the total number of container TEUs, or 20-foot equivalent units, and divides it by the total acreage available for container storage.

The North American average for TEUs per acre is 2,455. In the first quarter of this year, the Ports Authority achieved a utilization rate equivalent to 3,678 TEUs per acre. This kind of productivity did not just happen over night. It has taken several years of hard work by SPA officials, stevedores, longshoremen, truckers and steamship lines.

The biggest change has been operating style. While many ports still predominantly use a "wheeled" operation where containers stay on the chassis, or trailer, the SPA has moved aggressively to a "grounded" operation where containers are densely stacked. This type of operation requires more handling equipment -- and lots of it.

Over the past several years, the SPA has invested nearly $40 million in new container stacking equipment. The purchases have included 38 toplifting container handlers averaging $275,000 each and 13 new rubber-tired gantry cranes costing $1.34 million a
piece. Eight new RTGs are currently on order.

In addition to the new equipment, there were several other important initiatives:

• Streamlined how trucks are checked in and out
• Simplified electronic data interchange
• Developed a new computer system to track containers in real-time
• Added new lanes for trucks to enter and exit
• Began stacking chassis to save more space
• Extended truck gate hours from 7 a.m. to 6 p.m.
• Installed new signs and striped areas to ease traffic flow and add consistency
• Added additional staff to container operations
• Developed a new port-wide Cooperative Chassis Pool for carriers to share equipment
• Constructed a new empty container yard

The SPA's efforts over the past two years have been guided by the Container Terminal Development Strategy, which says the SPA should optimize utilization of existing terminals before constructing new capacity. This strategy was conceived over 10 months, as the SPA staff and leading industry consultants completed nine distinct tasks, such as a market assessment and operations analysis.

The resulting document is commonly referred to as the Mercer Report and spells out a two-pronged approach to handling port growth. First, improve existing terminals through incremental
investment in new technology and equipment. As a final step, pursue development of a new container terminal. It is this aggressive, space-stretching plan that the SPA hopes will allow it to accommodate moderate growth until 2007 when new capacity would be required.

The last two years have seen significant improvements to the Wando Welch, North Charleston and Columbus Street Terminals. But the SPA's five-year capital plan considers another $150 million
investment in current port facilities so more changes and enhancements are yet to come. They will be required as the SPA seeks to squeeze every drop of capacity out of existing terminals.

Port of Charleston

Throughput Per Acre

 

Charleston, SC - While ballast water is certainly an issue for ports all around the world, it is less of a problem for the Port of Charleston and the Global Gateway Terminal because of four reasons.

• Mandatory reporting will help find ways to reduce the risks of non-native species.

In response to an Executive Order from President Clinton, the U.S. Coast Guard issued mandatory reporting guidelines in 1999 and encouraged open ocean ballast exchange, which is harmless. Ships entering U.S. ports from a foreign port must provide information on their ballast exchange to the U.S. government. The goal is to compile data to guide thoughtful and effective decision-making.

• National efforts to regulate the issue will take hold long before the first phase of the Global Gateway Terminal is operational.

The data from mandatory reporting will be used to determine further guidelines by the deadline in 2002. While visiting Charleston last year, Admiral James Loy, who heads the U.S. Coast Guard, said they will carefully study this issue. In addition, the Ports Authority has encouraged the South Carolina Department of Natural Resources to participate in an international solution through the International Maritime Organization.

• Charleston is better positioned to reduce the impacts than other ports.

There are a number of natural and competitive factors that reduce the risk of non-native species in Charleston harbor. As the fourth busiest port in the nation, Charleston has the world's largest and most modern ships. Containerships require less ballast than bulk ships, and the newer vessels require less ballast. Unlike the Great Lakes where ballast water has been a huge issue, Charleston harbor flushes regularly with the tides and is not a freshwater system. Finally, as mentioned in a report by DNR, most vessels calling Charleston have already called at other U.S. ports.

• The Ports Authority prohibits the exchange of ballast water at its facilities.

At its public facilities, the Ports Authority has a provision that prohibits the exchange of ballast water. The SPA's terminal tariff, which governs all vessels calling all SPA facilities, states in Rule
34-165, "Discharging ballast, rubbish or dunnage in the slips or channels is prohibited. No vessel will be allowed to discharge ballast at the facilities of the Authority. Vessels must obey all
Authority, local, state, national and international environmental laws and regulations." All ships visiting SPA facilities are governed by this rule, and they and their agents are aware of its
regulation.

# # #

BACKGROUND ON BALLAST WATER

What is Ballast Water?

Ballast is water taken aboard all modern ocean-going vessels to achieve the required operating conditions. It is necessary to ensure the ship's stability and safe operation. Stones provided the world's earliest form of ballast, many of which were used in early cobblestone streets.

Ballast Not Bilge

Ballast water is NOT bilge water, or oily material discharge. There are very strict U.S. laws and international regulations surrounding bilge. Under federal law, unlawful discharge of machinery space bilge is prosecuted by the Department of Justice in Federal District Court. In fact, it is no longer legal anywhere in the world, either at sea or in port, to pump bilge directly overboard.

Efforts to Resolve the Ballast Water Issue

• In 1990 the U.S. Congress passed the Nonindigenous Aquatic Nuisance Prevention and Control Act which mandated that the U.S. Coast Guard develop regulations to prevent further ballast water introductions into the Great Lakes. In 1993 the regulations became effective for vessels in the Great Lakes.
• In October 1996, Congress enacted the National Invasive Species Act of 1996, which expanded the scope of earlier regulations to include all waters of the U.S.
• On Nov. 27, 1997, the International Maritime Organization adopted a resolution "Guidelines for the Control and Management of Ships' Ballast Water to Minimize the Transfer of Harmful Aquatic Organisms and Pathogens."
• In February 1999, President Clinton issued an "Invasive Species" Executive Order ordering seven federal agencies to establish an Invasive Species Council to develop a cooperative strategy and management plan by August 2000 to manage the threat.
• In July 1999, an interim rule was published by the U.S. Coast Guard providing voluntary ballast water management guidelines for vessels entering ports outside of the Great Lakes and a reporting provision. These guidelines will become mandatory in 2002.

Charleston, SC - Charleston's now a lot closer to India and Asia. Two groups of steamship lines, most of whom already serve the port, have chosen Charleston for two new services, bringing 78 new ship calls a year.

In a major victory, the South Carolina State Ports Authority has successfully renegotiated the contract of one of its largest customers, a shipping consortium consisting of China Ocean Shipping Company, Yang Ming and "K" Line. The group is one of the port's top five customers, moving more than 100,000 containers through Charleston each year.

The net result for the Port is a new weekly East Asia service, while also maintaining the alliance's services to North Europe and the Mediterranean. The new joint service of COSCO, Yang Ming and "K" Line, called the "AEX," will travel between the U.S. East Coast and East Asia through the Panama Canal.

COSCO and Yang Ming previously served China and the Mediterranean through a single Suez Canal service. Now they offer two services, one to the Mediterranean from the East Coast, and another to East Asia, including Japan, through the Panama Canal. All three lines will participate in the trans-Panama service.

"With the larger alliances dominating our business, it's very often an all or nothing situation," said Bernard S. Gro"Not only do we kept two ships a week in the Europe and Med routes, but importers and exporters have another option to East Asia."

The full port rotation is Shanghai and Yantian, China; Hong Kong; New York-New Jersey; Norfolk; Charleston; Tokyo and Kobe, Japan; and Shanghai. Charleston is the last port called outbound before the ships sail across the Pacific, minimizing transit times for exporters. The first vessel is expected at Charleston's Columbus Street Terminal in late May. Another major customer at Columbus Street moved to the Wando Welch Terminal earlier this year, making room for the new business.

The Port was also selected for a new joint service, the India-America Express, sailing every two weeks between the North Charleston Terminal and India, the Mediterranean and the Middle East. While initially a fortnightly service, the carriers say the service will soon grow to a weekly rotation. Partners in the offering include Shipping Corp. of India, Contship and CMA-CGM.

Ports of call include Mumbai (Bombay, India), Colombia (Sri Lanka), Jeddah (Saudi Arabia), Port Said (Egypt) and Gioia Tauro (Italy).

Charleston, SC - The South Carolina State Ports Authority today announced three major initiatives to address public concerns over the proposed Global Gateway Terminal on Daniel Island. The SPA has altered the location of the first phase, requested legislative approval of future phases and asked that a neutral mediator be appointed to resolve rail right-of-way issues in the Cainhoy area.

"These initiatives are the result of considerable effort by our Board and staff, as well as the extremely helpful counsel of the Delegation's Port Subcommittee, which has been addressing our expansion over the past several weeks," said SPA Chairman Edgar A. Buck of Charleston.

Chairman Buck and SPA President and CEO Bernard S. Groseclose Jr. spoke with Sen. Ernie Passailaigue before the special Board meeting. Sen. Passailaigue chairs the Charleston County Legislative Delegation's Ad Hoc Port Subcommittee. That committee was established earlier this year to hear testimony on the project and report back to the full delegation.

Mr. Groseclose characterized the announcement as "responsive to the concerns of the local community, while enabling us to meet our customers' needs and fulfill our responsibility to South Carolina's economic vitality."

In a special teleconference meeting at the SPA's Main Office in Charleston, the Board voted to adjust its plans, saying the first phase of the proposed shipping terminal will be built on the Cooper River side of Daniel Island, instead of the Wando River side. The Cooper side of Daniel Island sits across from more industrialized areas and the former Navy Base.

"This is in direct response to concerns voiced by citizens and elected officials. The Ports Authority hopes this shows our willingness to both listen, and to act," said Chairman Buck.

The SPA owns approximately 1,300 acres of former dredge disposal sites on Daniel Island and has applied for a permit to construct a port terminal in small phases to serve the shipping needs of South Carolina industry over the coming decades. The first phase of the terminal will include approximately 4,000 linear feet of berth and the associated container storage areas. With 5.8% annual growth among existing customers alone, the SPA will be out of space by 2007. This year alone, container volume is up more than 20%.

"This demand amplifies the need to prepare for the future," said Mr. Groseclose. "Even with $100 million invested over the coming years to improve existing terminals, the first phase of the new terminal on Daniel Island must be constructed in the near term if we hope to keep our port competitive.

"From a strictly navigational standpoint, the Wando River side is more attractive," said Captain Whitemarsh S. Smith III, an SPA Board member and president of the Charleston Branch Pilots Association. "But our decision has to be based on more than just navigational concerns. Advanced simulations show the Cooper side will work."

Capt. Smith continued, "Existing plans for the new bridge across the main channel include a southern alignment and a 1,500-foot horizontal span, improving navigational access up the Cooper River. In addition, powerful tractor tugs have entered the port to serve the larger vessels turning up the Cooper River and will aid access to the future port site."

To address the scale or size of the project, the SPA Board agreed that all future phases of the terminal would require the approval of the South Carolina General Assembly. Opponents of the proposal have said that the SPA's long-term development plan was too large for the Charleston community.

"This essentially gives the legislature veto power on future port expansion. Most importantly, it provides an opportunity for community concerns to continue to be heard over the life of the project, while preserving the near-term viability of the port," said Chairman Buck.

The SPA also today announced that an independent mediator will be appointed to examine, re-examine and assess all possible solutions to the rail location challenge. "No avenue will be ignored, no assumptions will be made and no possibilities will be overlooked," said Chairman Buck. "We will seek the assistance of the Legislative Delegation's Ad Hoc Port Subcommittee in selecting the mediator."

Mr. Groseclose said, "The rail route has been a major concern in the long-range port planning process. The goal is to develop a viable route -- one that is acceptable to the community and that can also be permitted by the regulatory agencies. All information from the transportation consultants will be shared with the mediator and the community for their examination."

At the conclusion of today's meeting, Chairman Buck said, "These are very significant initiatives that we are announcing today. They directly address the concerns we have been hearing, and they do so in a way that we believe is very responsive. At the same time, I am confident that we can continue to meet the needs of our customers and fulfill our role as an economic engine for South Carolina."
The SPA's mission is to contribute to the economic development of South Carolina. All but three of the state's 50 largest manufacturing employers ship through the port and every county is home to companies conducting foreign trade. In all, there are 83,000 port-related jobs in South Carolina, paying $2.6 billion in wages annually.

"The positive impact of the Port on people's lives and the South Carolina economy is tremendous," Mr. Groseclose said. "These are real people with real jobs that rely on international trade. We must reach a solution to the port's long-term competitive needs. Thousands of people are depending on it."