Ports smart to focus on outside rivals

The News TribuneMay 29, 2014 

When maritime business was growing, the ports of Tacoma and Seattle had the luxury of battling each other for bigger pieces of the pie by taking business from each other.

But now — as they still feel the damaging effects of the recession — officials at those ports see the handwriting on the wall: If they don’t start cooperating and focusing on outside competition instead of each other, they could face even tougher times ahead. They’re losing business to the Southern California ports of Los Angeles and Long Beach and to British Columbia’s Vancouver and Prince Rupert ports.

The Canadian ports have an extra competitive edge: Their customers don’t pay $100-plus per container to the U.S. Harbor Maintenance Trust Tax. Shippers from Asia can offload their cargo more cheaply in British Columbia, where Canadian railroads have been offering bargain rates to haul shippers’ freight east.

As if that weren’t bad enough, on the horizon looms the 2016 opening of a wider Panama Canal that can handle larger ships — making it less expensive to transport cargo from Asia to the U.S. East Coast.

As The News Tribune’s John Gillie reported Sunday, the ports of Tacoma and Seattle aren’t being complacent in the face of these challenges. They’ve taken some smart steps: obtaining antitrust immunity so they can collaborate on strategy to retain market share, upgrading their terminals to handle the larger ships that are becoming more common, and hiring a consultant to study the two ports’ finances and operations and recommend ways they can be more competitive.

Tacoma seeks to diversify its port business so that it’s not so container-dependent. Toward that end it has leased land to a multinational consortium that plans to build a facility that would convert natural gas to methanol.

The $1.8 billion plant — perhaps the priciest in Pierce County history — will employ 1,000 workers during the three-year construction phase and more than 200 when production begins. With some port jobs likely to be lost with increased automation, those industrial jobs will be welcome on the Tideflats.

In the past, Seattle interests were perceived as trying to address competition from the Port of Tacoma through a port merger that South Sounders legitimately feared would benefit Seattle much more than Tacoma.

This recent collaboration doesn’t appear to be a step in that direction. Good — the two ports should be able to find ways to increase their business at the expense of others, not each other, while still maintaining their autonomy.

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