SAVANNAH ― The Georgia Ports Authority’s Griff Lynch works in the maritime shipping industry, so boat metaphors come naturally to him.
The CEO describes business since the start of this decade as a boat rocking on heaving seas. The unpredictability that started with a worldwide manufacturing disruption due to COVID-19 in 2020 continued with a supply chain surge coming out of the pandemic. More recently, a rainfall drought slowed traffic through the Panama Canal and attacks by Houthi militants near the Suez Canal sent cargo ships on a 5,500-mile detour around South Africa’s Cape of Good Hope, adding 10 days to the journey.
Now, coming off a period when supply-and-demand patterns had seemed to stabilize, the Georgia Ports are riding up the face of another wave. Lynch on Tuesday reported a sixth straight month of year-over-year gains, but he suspects another extraordinary factor at work: a looming labor negotiation deadline with the longshoremen’s unions that work the docks in Savannah and other ports along the East Coast and Gulf Coast of the United States.
The current agreement expires Sept. 30, and the unions last week broke off talks with ports authorities, prompting Harold J. Daggett, president of the International Longshoremen’s Association, to warn of a potential strike. Lynch told the Georgia Ports Authority’s board Tuesday the recent surge in business is potentially, even likely, tied to shippers moving extra inventory through the ports ahead of a possible work stoppage — or what’s referred to in the industry as front-loading.
“The boat is a’rockin’” said Kent Fountain, the authority board’s chairman. “We’re confident we can get it back steadied out; we think that’ll happen this year. And it’s not near like the front-loading that happened coming out of the pandemic” that caused such unpredictability.
Credit: GPA Photo/Stephen B. Morton
Credit: GPA Photo/Stephen B. Morton
A year of downs and ups
The rocky seas were on display throughout the Ports Authority’s Fiscal Year 2024, which closed June 30. Container volumes finished down 2.3% for the year, cratering between July and December 2023 as the supply chain finally caught up with COVID-related demand, before soaring between January and June 2024.
Lynch, a 37-year veteran of the maritime trade industry, noted that ports activity often happens in cycles. The nature of the business is why the Ports Authority has not altered its course on investing $2 billion to infrastructure improvements. That includes the conversion of Ocean Terminal, located near downtown Savannah, from a multipurpose facility to one that handles containers exclusively, and the construction of an additional container terminal on an island across the river from Ocean Terminal.
The recent unpredictability of maritime trade hasn’t affected growth forecasts for the nation’s third-largest port. The 2024 performance was still up 3% compared with cargo activity in 2019, the last full fiscal year before the COVID-related disruptions.
“We’ve got to be prepared for what’s coming,” Fountain said.
The Ports Authority continues to hold its own in market share, Lynch said. Among U.S. ports, the Savannah terminals have seen increases each of the last three years, reaching 11.2% at the end of Fiscal Year 2023. The 2024 data is not yet complete but Lynch predicted Savannah will see a slight downtick in market share overall but an increase versus East Coast port competitors.
Credit: Voyage Creative
Credit: Voyage Creative
Brunswick port, India trade are bright spots
Another encouraging sign for the Georgia Ports is the performance of the Brunswick terminal that handles roll-on, roll-off cargo, such as automobiles, construction equipment and other heavy machinery. Brunswick finished the fiscal year having handled a record 876,000 units, an increase of 21%.
Of that business, only about 14,000 units came off ships rerouted to Brunswick during the Port of Baltimore’s closure due to the collapse of the Francis Scott Key Bridge. The bridge fell after being struck by a cargo ship that lost power while leaving the port. The accident killed six construction workers who were doing maintenance on the bridge at the time.
The Georgia Ports Authority also experienced growth in its trade with ports in India during the last fiscal year. Four vessels now make weekly calls on Savannah from India, reflecting a shift in manufacturing from China to neighboring countries in southwest Asia. Ships leaving India sail west to access U.S. East Coast ports such as Savannah rather than east across the Pacific Ocean and through the Panama Canal as China-based vessels do.
Exports to India have grown by 60% over the last five years and the Ports Authority is actively seeking more business. Plans call for a trade delegation trip to the subcontinent within the next 12 months, Lynch said.
“The growth to this point has been of small numbers, but with percentages like that, you’ll become a big player over time,” Lynch said.
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