North American Marine Highways (2010) / Chapter Skim
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Appendix D - Compilation of Potential Obstacles to the Development of Marine Highways
Appendix D - Compilation of Potential Obstacles to the Development of Marine Highways
Pages 67-74
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From page 67... ...
33 Difficulty in selling feeder service to ocean carriers Fewer and fewer carriers or alliances control larger and larger blocs of cargo, and the number of potential customers of a feeder service is reduced … Steamship lines often do not realize the full costs of trucking operations and thus mistakenly believe barge service is overpriced … Bills for "hidden costs" come into different departments and different individuals at the steamship company. 2, 7 International cargoes On Canada's Atlantic Coast, a NAMH based purely on international cargo is not financially viable since the largest customers of Canadian National Railway (CN)
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From page 68... ...
… Ground storage capacity is currently at a premium at most ports. The current policy of managing capacity through surcharges will discourage growth of comparatively low-revenue domestic transportation … Information systems support to coordinate "hand-offs" between motor carriers, ports, and ocean carriers would be a critical service component to ensure a seamless service … Initial capital costs, including vessel procurement costs and port infrastructure-related costs, are much higher in NAMH than in trucking, which deters carriers to invest in such business … Potentially insufficient terminal capacity and added congestion on port access routes … Diverting over-the-road truck volume into port areas for marine highways service use may compound existing traffic congestion issues in and around the ports … Port infrastructure constraints do not appear to be a major obstacle to expanded services … However, bringing shippers physically closer to carriers by creating warehouse and processing sites near the water may be an important incentive for development of NAMH and this could be difficult given municipal tax policy in British Columbia, zoning rules, environmental permitting requirements in coastal areas, and community opposition to port expansion in both Canada and the United States.
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From page 69... ...
Truck and rail operators are able to have 24-hour service with no recovery charges … Anything that constitutes more demanding or lower-quality customs treatment in comparison with that applied to land alternatives disadvantages marine movements in relation to an all-land route … Administrative barriers because of rather complex documentation and procedures in ports and the veterinary checks … Canadian cost recovery fees … Clearly, the service would benefit from more harmonized documentary procedures (including, of course, the use of a single waybill)
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From page 70... ...
… No carriers that were interv iewed noted th at the Coasting Trade Ac t or the Jones Ac t were a sp ec ific co ncern or hindrance to them with regard to cross-border NAMH … The Jones Act, which requires that ships engaged in domestic maritime trade be U.S.-built, U.S.-owned, U.S.-flagged, and U.S.-operated, was cited by many interviewees as a key obstacle to expanding the use of NAMH operations in the region … Canadian cabotage restrictions and duties create sunk costs that can not be recovered if the service is unsuccessful … Duties, in conjunction with other maritime fees, make new entry into NAMH services extremely costly and risky. 30, 31, 33, 38 Municip al iss ues (I n Canada)
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From page 71... ...
shipyards that make them unemployable in any other service thereby creating a significant business risk for any investor contemplating such a start-up service … Lack of capital financing guarantees for new ship construction through the Title XI program … Ocean carriers perceived that the high capital cost of U.S.-built ships was the single largest obstacle to successful implementation of domestic coastal NAMH services … Initial capital costs, including vessel procurement costs and port infrastructure-related costs, are much higher in NAMH than in trucking, which deters carriers to invest in such business … Amazingly, the Jones Act was barely mentioned by marine operators … High U.S. shipyard construction costs … The capital investment by the transport operator is so much greater that there is considerable work on the part of all players to make the mode a viable alternative … The extremely high cost of commercial vessels built by U.S.
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From page 72... ...
. However, many of the bulk raw materials shippers that traditionally used this service are in decline or restructuring of the industries has moved production locations farther from water loading points … The more common operation for bulk transport is to load directly on barge from a production site with appropriate bulk handling equipment … There is a lack of "port partnering." … Canadian icebreaking fees, even when there's no ice … NAMH operations are subject to "way" charges (one example being pilotage and another being marine services fees)
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From page 73... ...
Available at http://advancedmaritimetechnology.aticorp.org/short-sea-shipping/nsrp-pdmt-americas-marine-highways-workshop-october2008/John%20Cameron%20Operators%20Panel.pdf as of June 30, 2009. 10 Columbia Snake River System and Oregon Coastal Cargo Ports Marine Transportation System Study, Appendix C, Short Sea Shipping in the Columbia/Snake River System.
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From page 74... ...
Atlantic Canada Short Sea Shipping Background Study. Transport Canada, Ottawa, ON, Canada, 2003.
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