Supply chain snarls open new opportunity for Jaxport: chartered cargo ships (Courtesy of the Jacksonville Business Journal) — Jaxport is set to welcome its fourth charter vessel in the past five months next week. Its arrival builds on the opportunity created by supply chain challenges elsewhere.
The port, in recent years, has not handled chartered container vessels. There had not been as much of need for alternative cargo transport prior to the pandemic.
Port officials noted they remain in discussion with vessel owners and charter owners to bring additional charters to Jacksonville.
“We are having regular conversations with charter vessel operators about the advantages of shipping through Jaxport,” Jaxport spokeswoman Chelsea Kavanagh wrote in a statement. “Many of the efficiencies that we promoted pre-pandemic are even more relevant to the industry today: harbor deepening, two-way shipping channel, open berth availability, outstanding labor, and some of the best highway and rail connections in the South Atlantic.”
Because Jaxport is a landlord port, it does not sign charter agreements directly with companies but steers them toward its tenants, as was the case with Hapag-Lloyd and TraPac.
How much the terminal operator earns and how much the port earns from charter vessels is dependent on the contracts that the former has signed. Operators that have base rent included in their contract pay less per individual vessel call than those whose payments are dictated by tonnage or individual units.
“There are more companies trying to charter container vessels now to the East Coast than historically because the demand is so high due to existing liner service being full and container rates being high enough to warrant the cost of chartering such a vessel,” Kavanagh wrote. “Due to this high demand, ship availability is tight throughout the industry. Our ability to attract charter vessels is largely dictated on the charter vessel operators’ ability to secure available vessels. Several operators have told us recently that if they can secure a vessel, they would bring it to Jaxport to take advantage of Jacksonville’s efficiencies.”
Last fall, congestion in Savannah led to vessels being rerouted to Jaxport, with German conglomerate Hapag-Lloyd AG switching its AL3 route to Savannah after calling for eight weeks at Jaxport’s TraPac Container Terminal.
Hapag-Lloyd spokesman Nils Haupt told the Business Journal the company’s biggest takeaway from a 2021 where volumes were relatively flat was to be as flexible as possible in order to adapt to changing situations.
Jaxport estimates the nine-week Hapag-Lloyd service brought in 7,400 TEUs and generated more than $36,919 in revenue for the port.