This commentary appeared in the print edition of the Jan. 6, 2020, Journal of Commerce Annual Review and Outlook.
The Georgia Ports Authority’s central challenge of 2020 is staying ahead of exponential growth in demand for intermodal rail service.
Larger vessels transiting the Panama Canal have reduced the overall transportation cost of moving cargo to inland destinations, pushing the market frontier for East Coast ports farther west.
Because of the greater fuel efficiency of trains moving hundreds of containers at a time over these longer distances, rail is a natural choice for logistics providers.
At the Port of Savannah, between fiscal years 2017 and 2019, rail cargo grew more than 35 percent (132,500 lifts), for a total of 506,700 rail moves in fiscal year 2019. That is more than twice the rate of GPA’s overall growth in container trade, which increased 16 percent during the same period.
Along with greater volumes on the vessel side, we expect demand for rail service to continue its steady increase. This is the motivating force behind significant rail expansion at Savannah’s Garden City Terminal.
The Mason Mega Rail Terminal will double the Port of Savannah’s rail lift capacity to 2 million TEUs per year when it opens in early 2020. The expansion will add 97,000 feet of new rail track at Garden City Terminal, for a total of nearly 180,000 feet, and will increase the number of working tracks from eight to 18. The 85-acre site will allow Class I rail providers CSX and Norfolk Southern to build and receive 10,000-foot unit trains on terminal.
This capability, in turn, will enable direct rail service to major Southeast and Midwestern markets, areas that offer opportunity for significant market share growth for East Coast ports.