This week lets focus on an export US lane, highlighting the buoyant activity from the Port of Savannah. It is the 4th largest containerized Port in the country after Los Angeles, Long Beach and New York.
Vessel upgrades in the Transpacific via the U.S. West Coast (USWC), is a clear threat for all water activity via the U.S. East Coast (USEC) in direct connection with Asia. Upply’s data reveal an average price of USD 1,800 per HC port to port, to compare with USD 1,400 from Los Angeles to Shanghai.
Savannah’s response is very clear: Upgrade the port to accept the latest Panamax Vessels (14,000 TEUS format) and anticipate long term growth. Invest in multimodal Hinterland connections, and dry port with the Appalachian dry Port project at the Tennessee border.
It is always interesting to benchmark the all water, versus the land bridge options between USWC and USEC with Asia. U.S. Shippers from the Eastern States having the choice between a « fast » land bridge service, or an economical but long (up to 40 days transit time) all water service. The transit time difference is 2 weeks, and the price differential is 1,000 USD per HC. It can look moderate in terms of fiscal value. However, this route is being driven by commodities with relatively low values per box and are accordingly very sensitive to the rates.
Photo credit: Image by Paul Brennan from Pixabay