Barge Shortage May Hurt Inland Ports

While the fallout from Katrina and Rita are being felt at several deep-draft ports in the Gulf, for now, inland ports have been relatively unaffected by the storms. 

However, officials worry that things could change.

Chemicals and petrochemicals moved during the third quarter were down 3 percent to 5 percent at the Port of Pittsburgh, which likely reflects a disruption in oil-and-gas traffic because of the storms.

“This is not significant, only a slight decline, but it might not reflect how serious it might become,” James McCarville, executive director, Port of Pittsburgh Commission, said at an American Association of Port Authorities seminar held in Pittsburgh in October. “Many of us on the inland system think we have dodged the bullet on this, since it happened far away, and we’re feeling economically resilient. But we don’t yet understand the full impact of this. It’s really too early to tell.

“The real problem is going to be if there’s not enough barges,” said McCarville, whose port gets 15 percent of its cargo from the Gulf. “As production at the [oil and gas]facilities goes back on line, there might not be enough equipment to move it.”

Barge rates have about doubled, and costs will get passed on “if you can find a barge to move the goods,” McCarville said. “About 100 to 200 barges were lost, and there’s already a shortage of barges. No one is building new ones because of high steel prices. Tempers are flaring and relationships are being strained. For shippers, there will be a problem finding equipment.

“We have not felt the full impact of how bad it might get,” he added. “We had stretched thin our supply train, which has just suffered a major shock. This should force us to rethink some of our policies, such as just-in-time inventories.”    — Pamela Glass 

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