Shipping Industry Begins Preparations for Future Launch of Ship-Based Container Service to the Midwest | Company

The collaborative effort to launch the first patented container-on-vessel (COV) service in the Midwest continues to make great strides, with several key milestones achieved in recent weeks. Work is already underway to prepare for the safe launch of the patented vessels, which will operate on a new north-south all-water trade route connecting the St. Louis area to the lower Mississippi and global destinations.

“Our vision is to deliver a new, value-added service to the supply chain that will provide lower cost options for shippers,” said Sal Litrico, General Manager of American Patriot Container Transport LLC (APCT). He said optionality is needed more than ever, given recent transportation and logistics issues that have created major challenges for shippers with no real end in sight, coupled with exponential growth projections for containerized freight.

Litrico said the new COV service has three key components. The first is the new regional gateway terminal located on the Gulf Coast in Plaquemines Parish, which will provide full intermodal service across the widest and deepest part of the river without operational constraints. The second is strategically located Midwestern partner ports, which, like the Gateway Terminal, will be state-of-the-art and incorporate automation and an environmental footprint. The third stage is the patented, state-of-the-art, purpose-built vessel, which will come in two classes – the Liner that will transport containers on the Mississippi River and smaller hybrid vessels that will operate in the rivers. tributaries. Litrico said the ships have significant competitive advantages, including critical mass volume and speed.

One of the milestones reached recently is the tender for the construction of four new ships, with an option for four more. These will be built in US shipyards as required by the Jones Act, a federal law, and Litrico said they continue to work closely with interested shipyards to achieve a mutually beneficial outcome in the next 30 to 45 days.

Another milestone is the signing of long-term freight commitments for the first phase of operations, which is service between the Gateway Terminal and Memphis, which is expected to be the first hub port in the Midwest to come into service. This service will include four dedicated vessels capable of making the round trip in 6.2 days. The Gateway Terminal secured initial rail financing and APM Terminals, part of Maersk, agreed to operate the terminal. Regarding phase two of the initiative, Litrico said it is working with key Beneficial Cargo Owners (BCOs) and shippers to secure freight commitments, which will include four additional vessels and subsequent ports in the Midwest. , which will be determined by shippers later this year. . The operational start date is scheduled for the second half of 2024.

Hawtex Development Corporation plays a key role in the development of container terminals on inland waterway systems, helping to identify suitable locations where inland vessels could enter the port and where they would develop a true inland intermodal container yard. Memphis and the St. Louis area are two sites they have targeted. Hawtex President James Hurley said they are under development at both sites, with potential ports also being considered for Joliet, Illinois and Fort Smith, Arkansas. The Jefferson City and Kansas City feeder ports would also be part of the system. Focusing on the Herculaneum, Missouri site, just south of St. Louis, Missouri, he said they have a development agreement with Fred Weber/Riverview Commerce Park, which manages current operations, and are in talks with a second owner to bring them into the project.

“The coordination between these two companies has been very impressive from my perspective, as a developer,” Hurley said. “We are very comfortable moving forward with how we integrate the two properties into this unique development for the container terminal itself and the support area surrounding it.”

The new inland container terminal at Herculaneum would be built on approximately 75 acres, and there are over 125 additional acres for further development of an industrial park behind the terminal, taking advantage of proximity to Interstate 55 and the existing rail connection. Hurley said they were completing 10% design drawings by Vickermon & Associates, a Virginia port and intermodal design firm, and hope to secure a construction contract within months with the goal of making operations available at Herculaneum d by fall 2024. .

“In the United States, this mode of transport has not really been trusted because in the past it was normally done by barge here. We’re actually creating strategically constructed river vessels with the goal of making maximum use of the Mississippi River as well as its tributaries,” Denson White said. “We’re going to be able to move inland at a very efficient pace. In Europe, it is exactly the same. Ships are built so they can travel through the river system, still pass under and across bridges, and move at a faster rate than a barge. White is director of customer engagement at APM Terminals, which operates 76 port terminals around the world, including several in Europe where river vessels are a common means of transport to move products inland.

As the debut of new ships on the inland waterways draws closer, the APCT is working closely with Captain John Arenstam, USCG (Retired), Assistant Director of the Seamen’s Church Institute’s Maritime Education Center (SCI). Arenstam is the project manager for SCI regarding the partnership with the APCT, and has four different areas of interest: ship modeling, port feasibility studies, navigation, officer assessments and navigation training.

“Sailors who will navigate the ship will actually have a hydrodynamic model to practice on and learn how the ship behaves before leaving the shipyard,” Arenstam said. He said the preparatory work will take place in the shipyard, using four world-class interconnected Kongsberg Maritime simulators as well as the feasibility studies. This will allow them to have the COV with other existing inland tug models operating in the area of ​​the proposed ports to test how they will be able to interact.

Daniel Every, U.S. Coast Guard Lieutenant Commander and Prevention Department Chief, Upper Mississippi River Area, also plays an important role in ensuring the safe launch of this new service.

“Our main objective is to ensure that the shipping system and users of the shipping system are prepared for this new service through outreach and collaboration with all our port partners and upstream and downstream stakeholders. downstream of the river system,” Every said. “We want to work closely with vessel and facility owners and operators to ensure this is a safe and efficient business from the start, and that everyone is able to support this. major development, while ensuring equity in the use of the waterway for all. waterway users.

Each said they thought the VOC was one of the maritime industry’s most significant innovations in a very long time, likening it to the expansion of the private space travel industry in Florida.

“With the fairly recent expansion of the Panama Canal and unprecedented deepening projects on the east coast and along Gulf Coast ports, the ability to move containerized cargo efficiently and cost effectively along the river depends on the ability to move containerized goods at speeds that meet customer needs while providing economies of scale to the shipper. Thus, a purpose-built vessel of the proposed design is an exceptionally novel idea. It fills an existing logistics gap in this area by providing the economy of scale and speed that freight owners and logisticians want to see. So I expect the demand to be there,” Every said.

White agreed and said part of the success would come from the recent supply chain disruption that forced BCOs to rethink their existing ways of doing things. “CEOs who have never been part of the supply chain and might have only thought about sales and manufacturing are stepping in now and trying to better understand how they can move their cargo more efficiently, and here is our opportunity to really make progress in offering more solutions, more opportunities to choose from.

“Our new transport alternative for containerized freight is necessary and strategic, adding options to the supply chain and shippers and providing choices, potential savings and the opportunity to improve or expand the profile or model. shipper’s distribution,” Litrico said. “Furthermore, a greener footprint has enormous value and will help achieve shippers’ long-term goals.”

Mary Lamie, executive vice president of Multi Modal Enterprises for Bi-State Development and manager of the St. Louis Regional Freightway, said, “If there’s one key takeaway, I think it has to be the depth of the collaboration in place to bring this new service online – working with various partners to build the individual ports, collaboration between the people who will provide this service, the Coast Guard and the Seamen’s Church Institute to ensure the highest level of safety is maintained for actually launch these services. And, ultimately, the collaboration between the various port facilities along this new trade route and with the shippers who will benefit from the new innovative offer.

Lamie moderated the COV discussion which focused on progress being made towards the launch of the service as part of the first day of FreightWeekSTL 2022. FreightWeekSTL 2022 ended on May 27 and featured panel discussions with other industry experts and leaders in freight, logistics and transportation. . The week-long event was presented by St. Louis Regional Freightway and Bi-State Development in conjunction with The Waterways Journal. To learn more and see one of the FreightWeekSTL 2022 sessions, visit www.freightweekstl.com.