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John Buckley

With the economy coming out of a hole, it is time to reflect on expectations in the local New York-New Jersey container terminal industry looking out two years and beyond. U.S. East Coast liner capacity did not expand much in 2010 compared to U.S. West Coast and Asia-to-Europe trades, so volume appears to have held up quite well and expectations going forward are somewhat positive.

Looking beyond 2011, we will exceed volume levels of 2006-2007. That begs a question about what we have learned from previous volume peaks and how we handle potential capacity constraints and congestion that will ensue as volumes grow and larger vessels arrive after completion of the Panama Canal expansion in 2014.

Generally, terminal facilities increased throughput capacity during the recession and, I’m sure, have plans to generate much more capacity in coming years. Expanding terminal capacity without significant consideration of complementary infrastructure improvement “outside of the gate” could be counterproductive, however. Rail infrastructure has improved enormously, but road access remains a concern, although for the Elizabeth/Newark facilities with perfect proximity to the New Jersey Turnpike, a solution can be met easily and cost effectively. If the recent commitment by the state of New Jersey and the Port Authority of New York and New Jersey to “fix” the Bayonne Bridge by 2014 is any indication, strong leadership and vision will allow the port to expand its economic contribution to our region.

So the broader economic improvements will soon lead to the re-emergence of talk about congestion and bottlenecks. Do we have a plan, or are we still fretting over the recession-caused damage of the last two years?