The Port of Jacksonville said Hanjin Shipping has decided not to go ahead with plans to build a new container terminal at Dames Point on the St. Johns River.
However, the Northeast Florida port said as a result of announcements in the past week the number of liner companies offering services to and from Jacksonville and Asia will jump from nine to 15 as the G6 and CKYH Alliances adjust their services.
Roy Schleicher, interim chief executive officer at the port, said because of the depressed economy, the port came to a “mutual agreement with Hanjin… that we would not pursue building their container terminal at Dames Point.”
In December 2008, Jaxport executives and representatives of Hanjin Shipping in Seoul, Korea signed a 30-year lease agreement calling for construction of a 90-acre container facility at Dames Point, near MOL’s TraPac terminal. The $300 million terminal was expected to be a key hub for Hanjin's U.S. East Coast port activity.
“We already have other steamship lines and terminal operators that have expressed interest over the past year or so about building in Jacksonville,” Schleicher said. “However, I have told Hanjin if in the future they decide they do want to build a terminal, if we can find land, and it works for everybody and the the economy is good shape, then we would work with them as we did in the past."
As part of the mutual agreement with the Korean carrier, Schleicher said Hanjin would bring a new service to Jacksonville. He said nine of Hanjin’s vessels will participate in the AWE 1 loop, which will transit the Panama Canal and have a rotation of Ningbo, Shanghai, Pusan, New York, Wilmington (N.C.), Savannah, Jacksonville, Pusan, and Ningbo. The ships will have a capacity of about 4,000-4,200 TEUs.
Schleicher explained while Hanjin had already been offering a service to the port from the Far East with Evergreen through the Suez Canal, other members of the CKYH Alliance - COSCO, “K” Line, and Yang Ming - will now offer service through Jacksonville, starting in May.
Schleicher said the service is particularly attractive because Jacksonville will be the last port of call. Major exports out of Jacksonville include citrus, frozen juice concentrates, frozen poultry and paper products.
In addition to the CKYH service, G6 Alliance announced this week it will offer two services through Jacksonville - SVS and NYE - as a part of its decision to expand into the Asia-U.S. East Coast trade. The G6 is a combination of the New World Alliance (APL, Hyundai Merchant Marine, and MOL) and Grand Alliance (Hapag-Lloyd, NYK, and OOCL). Previously, only the New World Alliance had served the port, so Schleicher said the port is gaining another three carriers in the Asia-U.S. East Coast trade.
While Hanjin is discontinuing plans for the new terminal, Schleicher said he was “very impressed with their (Hanjin’s) commitment to Jacksonville with bringing these ships in.” He didn't give an estimate as to how much more cargo the new carriers might bring to the port.
Asked if he would rather have the ships than the terminal, Schleicher said “Let’s put it this way, I want the cargo, and you have to realize that the Hanjin agreement called for us, the port, to spend $250 million to $300 million to build it, and then they would pay it back through our contract.”
He said Hanjin's decision not to go ahead with the new terminal helps the port's bonding capabilities and means Jaxport will have additional money that can be put into other projects such as dredging, repair, and purchase of cranes and improving the port’s infrastructure.
He said a number of the companies that have approached the port about building terminals at the port have “wanted to bring their own money to the table and build their own terminal.”
Meanwhile, the Jaxport board of directors has placed an item on the agenda for its March 25 meeting to consider authorizing the acquisition of property by the use of eminent domain.
According to the Jacksonville Business Journal
, the port wants to acquire about half an acre of land to supplement another 37 acres where it wants to build a $30 million intermodal container transfer facility (ICTF).
Jaxport and CSX Corp. are developing the ICT at Dames Point to facilitate the direct transfer of containers between vessels and trains. The U.S. Department of Transportation awarded the port a $10 million grant toward the development of the facility, and the Florida Department of Transportation has allocated $20 million to fund it. The port’s Website said thr ICT is forecast to open as early as 2014, and will complement existing on-dock rail facilities at Jaxport’s Talleyrand and Blount Island terminals and will further enhance the competitiveness of the TraPac Container Terminal. - Chris Dupin