Source: http://worldcityweb.com/home/MIA/publications/magazine/3/638/

Short on space, big on growth

by Mary Dempsey

A steady stream of massive vessels stacked with containers makes its way toward Miami. Every other one of those cargo liners slipping through the channel separating high rise studded South Beach from tony Fisher Island is heading to the same place: POMTOC.

The world’s largest cargo shipping line, Maersk Sealand, has a terminal at the Port of Miami, as does Seaboard Marine, which specializes in container traffic from Latin America and the Caribbean. However, a homegrown independent operator, Port of Miami Terminal Operating Co., or POMTOC, is easily the biggest player at Miami’s port.

“We see anything you can imagine come through here,” says POMTOC’s new senior vice president and general manager, Fred Castonguay. “There are seasonal fruits in refrigerated containers, cancer-fighting drugs, fish meal, lawn furniture, Chinese-made weights for workouts. You name it.”

Although some ports have separate terminals for every shipping line that use them, common-user terminals are not unusual, especially on the East Coast. Still, POMTOC has managed to keep on top of the game, growing to become the dominant operator in Miami in the 12 years since it debuted. According to Port of Miami spokesperson Andria Muniz, 1,009,500 “TEUs” of cargo passed through the port in 2004. Of that, POMTOC’s terminal handled some 600,000 20-foot-equivalent units, the standard unit of measure in the maritime cargo industry. Changing Tides

Cruise ship traffic has put Miami in one of the busiest shipping lanes in the United States, but trade is the area’s biggest economic driver after tourism, bringing more than $12 billion annually to South Florida’s economy and generating some 98,000 local jobs, according to Port of Miami figures.

Cargo vessels stacked high with multicolored shipping containers sidle up to wharf at the port, and giant claws reach down to pluck the containers off each vessel. Maersk, Seaboard and POMTOC each have separate container yards dedicated to their operations, with POMTOC commandeering about 123 acres of the 518-acre port.

Within POMTOC’s yard, containers are transferred to a spot where U.S. Customs officials review them or, when no inspection is necessary, they are placed on concrete expanses where another set of claws lifts them onto the back of trucks so they can continue their journey overland. “Reefers,” the white refrigerated containers that carry food products and other perishables, are relegated to an area where they are plugged into electrical outlets so their contents remain cold until they are shipped out again or picked up by trucks.

A miniscule amount of cargo leaves the port by rail, but that is usually confined to shipments of machinery too large or heavy to move by truck.

“Day to day, we have three to five cargo vessels arriving and about 1,800 trucks coming through,” says Hilda Torres, POMTOC’s customer service manager. The cargo arrives from Asia after traveling as many as 32 days at sea, from Latin America, from Europe and from the Mediterranean. POMTOC may handle slightly more vessels bringing imports from the Mediterranean, but Latin American traffic is still strong. Port of Miami statistics show that Europe generates the greatest numbers of imports for Miami while the Caribbean is the port’s largest export-trading region.

That said, Miami’s trade landscape is undergoing a dramatic shift. For starters, cargo vessels much like cruise ships are becoming bigger. A decade ago, cargo ships routinely carried 3,800 to 4,000 TEUs. The Containership Register 2005, an annual publication profiling the world liner fleet, concludes that the average cargo vessel today has capacity of 8,000 TEUs. Drewry, an independent maritime adviser based in England, predicts that vessels capable of carrying 12,000 TEUs or more will become the liners of choice by 2010. And there is even talk of eventually using colossal “ultra-size” liners designed to handle 18,000 TEUs.

Bigger ships and heavier cargo containers are spawning infrastructure changes at ports around the world. As part of its 2020 Master Implementation Plan, the Port of Miami is undergoing $250 million in improvements, including dredging to accommodate vessels with deeper drafts, stepped-up security systems and an expanded yard for refrigerated containers. This year, the port added two gantry cranes designed to service bigger containers and larger vessels, bringing the total number of cranes at the port to 12. The larger super-post-Panamax cranes already are operating on the U.S. West Coast but Miami is ahead of most East Coast ports in acquiring the equipment.

Asian Factor

Cargo volume is not the only shift. The sources and destinations for goods passing through the Port of Miami have changed. A decade ago, domestic shipments for export dominated Miami operations. Today, nearly 70 percent of the traffic is imports, with a growing amount from Asia.

“China used to be a very small trade partner for Miami, but now it’s becoming a very important player,” says Castonguay. World City’s Miami TradeNumbers, an annual analysis of export-import statistics, reveals that China did more than $2.5 billion in commerce with South Florida’s U.S. Customs District (which includes Fort Lauderdale) last year. That makes it the area’s seventh most important trade partner, behind Brazil, the Dominican Republic, Colombia, Costa Rica, Honduras and Venezuela.

Muniz, at the Port of Miami, says cargo from the Far East, Asia and the Pacific region last year saw the highest year-to-year growth in volume: 19.94 percent

Castonguay expects traffic from China to continue growing as ports on the U.S. West Coast increasingly find themselves unable to handle swelling trade. “The West Coast ports have become saturated so the ships are coming through the Panama Canal here or they’re coming west from Asia through the Suez Canal,” the POMTOC chief says.

More than 30 container lines use the port. Maersk and Seaboard Marine handle cargo for other companies, although much of their business at Miami focuses on their own liners coming into the port. Rates charged by POMTOC and the other two operators are competitive. The Miami-Dade Seaport Department sets and regulates them much like the Florida Public Service Commission oversees utility rates.

More cargo sounds like good news for POMTOC and the port’s two other terminals. And it would be, if it were not for Miami’speculiarities, most notably its limited size. In fact, that space limitation is what spawned POMTOC’s birth more than a dozen years ago. The port authority was looking into the idea of a common-use terminal facility, and four stevedoring and terminal companies already operating at the port decided the private sector could run the terminal more effectively. They joined forces to create POMTOC which, after consolidation, buyouts and mergers affecting the founders, is now jointly owned by Florida Stevedoring Inc., London-based P&O Ports and Fort Lauderdale’s Eller/ITO Stevedoring Co.

Planning Ahead

“We formed POMTOC for the purpose of operating more efficiently, more effectively. We brought Fred in because of the extensive background he has in container terminal operations throughout the world,” says Jorge Rovirosa, executive vice president at Florida Stevedoring. “His last assignment was in Hong Kong at the largest container terminal in the world, in terms of volume. So he has a tremendous amount of experience in operating in restrained space. In fact, the Port of Miami is sometimes called the Hong Kong of the Western Hemisphere because we have nowhere to grow.”

POMTOC, with 23 direct employees and the equivalent of another 125 when shared hours for cargo handlers are added in, presently operates its terminal at 67 percent of capacity. Castonguay says Miami will need to imitate other land-constrained ports, like those in Asia, if it is to grow. That means stacking containers more than three tall, their height limit now, storing containers shorter periods of time before they are trucked or shipped out again and using the port’s space more efficiently.

Like the port itself, POMTOC is upgrading and replacing its infrastructure. It is projected to pump as much as $17 million into its operations by 2007. The improvements include the acquisition by late 2006 of mobile rubber-tire gantries, or RTGs. These top-loading moveable cranes will stack cargo containers six containers high. The gantries are also agile and can maneuver narrower spaces than other container-handling equipment.

Looking forward

POMTOC has moved its accounting services online so brokers and forwarders, as well as truckers, can more efficiently manage money transfers, terminal charges and other financial transactions. New technology has also allowed POMTOC shippers and truckers to track cargo.

The next step, slated to be unveiled in late 2006, is an electronic appointments system that allows truckers to schedule the exact time they will pick up cargo using special express lanes. The goal is to reduce the traffic jams that currently plague the port. If it sticks to its calendar, POMTOC will be one of the first terminal operators in the United States to employ such a system.

“Miami is right on the cutting edge. We’re trying to accommodate new security requirements, we’re trying to make the process as seamless as possible. We have been ready to do this all along but we had to wait for the right technology to be developed,” says Rovirosa at Florida Stevedoring. “One of the goals is to get the containers in and out of here as fast as we can. That’s the only way we’re going to be able to grow.”

Castonguay smiles when he describes POMTOC’s job as a simple one. “We have boxes. We pick them up, we put them down and we give them to someone else,” he says. Still, he acknowledges that coordinating all the players from shippers and freight forwarders to Customs brokers and truckers requires cooperation and smooth logistics. Still, as POMTOC focuses on how it can squeeze more cargo into a restricted space, he says there’s one secret for success: “Keep it simple.”