BYLINE: Janet Nodar
Which comes first, the cargo or the railroads?
Gulf ports will be adding hundreds of thousands of TEUs in capacity over the next few years, including the continued build-out of Houston's Bayport, Phase 1 of the Mobile (Ala.) Container Terminal and expansions at Tampa and New Orleans.
Further into the future lies the joint Houston-Galveston Pelican Island Terminal, scheduled to be completed around the time of the Panama Canal expansion.
Port officials believe railroads are crucial to making these expansions work. Houston is searching for a way to untangle a century-old rail network from a congested modern city and adding intermodal capacity, as are New Orleans and Mobile. So far, however, none of these plans appear to have convinced any Class 1 railroads to ramp up intermodal service to the Gulf. The Gulf is typically a regional container market. If cargo is heading for a point within 500 miles of a port, it usually moves by truck rather than by rail. To attract intermodal action from the railroads, "the ports have to reach critical mass," said James K. Lyons, director and chief executive of the Alabama State Port Authority. They will have to reach a volume that justifies increased railroad service and competes with more flexible trucks.
But doing so is necessary, Lyons said. "Railroads are the wave of the future. There's no money to build the highways that would have sufficient capacity to handle the projected growth in freight traffic," he said. The railroad intermodal option will be crucial for growth in the Gulf's container trade, according to Lyons.
Does that necessitate becoming a …