Supply chains are stressed. The biggest United States ports struggle to process container after container of imported goods. Given this challenging environment, some shippers believe container-on-barge (COB) service on the inland waterways might be a long-term solution.
Building out that service, however, remains the challenge. There is general agreement that there is great potential to increase container movement by water in many areas of North America, particularly along the Mississippi River and its major tributaries. However, it is a chicken and egg situation. Shippers won’t come until the handling infrastructure and container-on-barge vessels are in place; on the other side, there is a reluctance to make the substantial investments needed without proof of business viability.
“Currently there is very little intermodal infrastructure available and even fewer in use on the inland waterway system,” said Tim Power, chief executive officer of SCF, which provides integrated logistics and barge transportation services on America’s inland waterways. It is a company that is working to change the picture. For COB to succeed, he said, there must be economies of scale to ensure viability and a steady supply of cargo owners and intermodal equipment available to support the service. Otherwise, the cost of moving goods that way becomes higher than other modal competitors.
SCF currently operates the only scheduled “liner” service to Baton Rouge, Memphis and St. Louis from New Orleans with integrated container depots supporting the service.
U.S. Maritime Administration (MarAd) “is very supportive through the America’s Marine Highway program and has helped support the intermodal equipment pool to efficiently and cost-effectively service our COB route and integrated container depots,” Power added.
MarAd developed the Marine Highway Program to expand the use of the country’s 29,000 nautical miles of navigable waterways. Specifically, the agency wants to encourage movement of containers and other cargo over water to reduce highway congestion and vehicle emissions.
In December, MarAd awarded $12.6 million in grants to nine marine highway projects, about half of which were in or near the Mississippi system. At the time, U.S. Secretary of Transportation Pete Buttigieg said the spending aligns with Biden administration priorities to address supply chain disruptions.
And, in recent years there have been many testing the waters, so to speak, both along the coast and inland. For instance, Ingram Barge Company participated in a 2015 demonstration with towboat Miss Shirley, bringing a shipment to America’s Central Port in Granite City, Ill. The towboat transported containers via barge to show the viability of intermodal river transportation.
But Dennis Wilmsmeyer, executive director of America’s Central Port, said promoting riverine container shipping has been like pushing a wet noodle: frustrating.
“It is still in its infancy, but growing and maturing quickly,” he said.
The primary challenge is redirecting containers from China, which typically arrive via West Coast ports, to New Orleans via the Panama Canal. From there, they are moved upriver on barges. “We’ve had many, many meetings with steamship lines, shippers and purchasers, to get that whole system set up but the freight forwarders and shippers are pretty entrenched and ingrained with what they’ve done in the past, they don’t want to make a misstep,” he said.
Wilmsmeyer recalled meeting a few years ago with several big shippers, Walmart being one of them. “Their comment was, what’s your scheduled service?” And of course, at that point, “we were just looking for customers and trying to build the business.”
But with Covid-19 and the snarled shipping and long delays at Los Angeles and others deepwater ports, there is growing interest in alternatives. Furthermore, he said, there are enough big companies out there looking for more environmentally friendly forms of transportation, particularly waterborne container transport. “If they can stay away from truck and even rail as much as possible, companies are willing to spend a little more to get that done,” he explained.
Despite disappointing early starts, the container-on-barge concept remains promising. Late last year, a startup called Float Freight, funded by the Crosby Group, got off the ground. It promised to operate according to a regular schedule from day one. Based out of both Houston, Texas, and Galliano, La., the company initially serviced Mexico, Cameron, La., New Orleans, and Mobile, Ala. In addition to container movement, the company also offers transshipment and direct discharge options for heavy lift, bulk and breakbulk shipping, according to Mike Little, managing director at the company.
New hulls are hitting the water to support this type of service. Neal Langdon, executive vice president of Arcosa Marine Products, said his company looked for ways to further enhance the cost-competitiveness of COB and came up with an idea.
They looked at the standard river barge configuration, with tows generally composed of individual barges 200 feet long by 35 feet wide, operated side-by-side in combinations up to 1,200 feet long and 105 feet wide. They realized there could be big advantages in carrying more containers per barge and came up with a design that essentially builds one container barge, at 200 feet by 70 feet, on the footprint of two traditional inland barges. The wider container barge can carry 40 more 40-foot containers than two traditional barges combined.
designed container barge.
Langdon said his company also developed and patented certain refinements for supporting and handling the containers on the barges.
‘If you build it, they will come’
To succeed, container-on-barge service requires a hub concept that can be supported by multiple users and the infrastructure necessary to support it, including local drayage providers and chassis to move containers off the docks, according to Power. “The best concept would be for distribution center locations to be adjacent to or a relatively supportable dray distance from the container on barge yard,” he adds. For example, existing container service users such as cotton cooperatives and paper mills could provide cargo near their loading facilities and have large enough export or import volumes to have the container lines support additional transit time on the river. “Our integrated container depots in St. Louis, Memphis and Port Allen support this concept,” he added.
And then there is still the challenge of convincing customers. “Based on the feedback and the collaboration that we’ve had with some of the major shippers, the potential seems unlimited,” said Little, with Float Freight. “But they’re struggling to figure out how to get more containers on the waterway due to the relationships that they have with the ship owners, and how that’s controlled and how it’s contracted,” he added.
However, Little said three companies are expressing strong interest in working with Float Freight. “Once we get one client on board and show how it works and how efficient and cost effective it is, I think it’ll take off from there.” •