State of the Port Release: New Orleans

Despite the challenge of a global recession, the Port of New Orleans is taking steps to improve its infrastructure and grow business, Port CEO Gary LaGrange said today during his annual address to the World Trade Club of Greater New Orleans.

“We’ve seen many challenges in recent years, but through it all we have managed to keep our eyes on the future and building a better and stronger Port of New Orleans,” LaGrange said.

Two critical pieces of that future were passed by the Louisiana Legislature recently: A per-ton tax credit for Louisiana businesses using Louisiana ports and a tax credit encouraging private investment into public ports.

“Over the last year this port community came together like never before to support this landmark piece of legislation,” LaGrange said. “Gov. Jindal, House Speaker Jim Tucker and Senate President Joel Chaisson deserve a lot of credit for thinking strategically about the future of our industry.”

LaGrange also cited Reps. Nita Hutter, Cedric Richmond and Walt Leger as playing key roles in passing the legislation.

“The tax credit programs are very cost effective ways to help local companies compete globally, while also supporting Louisiana ports,” LaGrange said.

The main topic of conversation throughout the industry, however; is the global economic downturn and its effects on trade and transportation.

“The recession poses a major challenge to all ports and New Orleans is no different,” LaGrange said. “However, we are a diversified port and ready to face the challenges coming our way.”

Recently, Port figures have shown signs of a rebound. Ship calls were up 4.5 percent in the first five months of 2009 and total general cargo figures showed slight gains. Breakbulk cargo is up 15 percent, iron and steel imports were up more than 6 percent, and metals traded on the London Metals Exchange – such as aluminum, zinc and copper – have soared this year. Coffee imports are up 9 percent compared to a year ago, and the Port has handled about 5,000 tons of bananas so far – which is a new cargo. These gains offset losses on the container side of about 15 percent. However, LaGrange cited a positive statistic from July, when the Port handled 34,014 TEUs (twenty-foot-equivalent units) – up 57 percent from the same period one year ago.

“We have seen indications that conditions are improving,” LaGrange said. “It’s not across the board, but areas of strength will help to carry segments lagging behind.”

LaGrange also cited millions of dollars of repair and construction projects either completed, underway or in the design phase. All told about $70 million is currently being spent on infrastructure repair and improvement projects. In addition, design work is underway to modernize and improve the Julia Street Cruise Terminal – a $9 million project slated to begin next year.

Port officials also applied for $65 million in federal stimulus funds through a transportation grant program. The funds would build a new intermodal rail facility at the Napoleon Avenue Container Terminal, modernize sections of both Napoleon and the Louisiana Avenue Terminal Complex, and increase efficiencies.

LaGrange also announced the Port’s top priority – rebuilding the dockside refrigerated terminal capacity lost during Hurricane Katrina – is moving forward. The Port Board approved a plan today to use 13.5 acres of terminal operator Ports America’s leasehold to build a new 147,000 square-foot refrigerated warehouse. The Port’s current facility at Jourdan Road lost its deep-draft access when Congress closed the Mississippi River-Gulf Outlet following Hurricane Katrina.

LaGrange thanked Ports America and the current facility’s terminal operator, New Orleans Cold Storage, for working together.

“We’ve bent over backwards to make this plan a reality,” LaGrange said. “We’re talking about the largest export poultry operation in the country, which is crucial to Louisiana’s agriculture industry, as well as the maritime industry. It’s time to move forward to save hundreds of high-paying jobs.”

LaGrange said continued investment into the Port’s Napoleon Avenue Container Terminal will be a priority and should be a top project for the state.

“The most cost-effective way to increase container capacity is incremental investments in Napoleon,” he said. “Louisiana’s shipping community needs to pull together and stand behind the state’s existing facility and send a clear message to the shipping community.”

Other updates from the speech include:
· Two 100-gauge gantry cranes purchased for more than $13 million each are on schedule to be delivered next summer to the Napoleon Avenue Container Terminal.
· On Nov. 10, Carnival Cruise Lines will replace its 2,600-passenger Carnival Fantasy with its 3,400-passenger Carnival Triumph, which will sail four- five- and seven-day cruises, including a new eastern Caribbean itinerary.
· Construction will begin in 2010 on the $9 million project to improve and modify the Julia Street Cruise Terminal – taking two existing terminals and creating one large, modern facility.
· A $400,000 project to renovate the John Churchill Chase Riverfront streetcar stop will improve access between the streetcar line, Morial Convention Center, Riverwalk Marketplace and the cruise terminals. The project is being done in concert with the Regional Planning Commission.
· Increased demand led Miami-based Seaboard Marine to employ a larger ship in its weekly Port of New Orleans container service with Latin America. Seaboard’s 974-TEU Seaboard Caribe replaced the 640-TEU Heinrich J.
· CMA CGM and Mediterranean Shipping Company partnered to employ a new European service, which will begin in October, with the CMA CGM Bellini making its maiden call to the Port of New Orleans.

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