7a supp

ITEM NO: ______7A_PPT_______ 
DATE OF MEETING: April 9, 2013__




Competitive Situation Briefing - Containers
Port of Seattle Commission, April 9, 2013

Ships are Getting Bigger




And carrier focus is
cost containment

Large Vessel Fleet & Order Book



10,000+ TEU Ships


Source: AXS Alphaliner & POS internal data

Terminal Capacity Expansion for Big Ships

POS Market is Targeted by Other Ports
Prince Rupert, Canada
Vancouver, Canada

Nova Scotia, Canada
Seattle



Oakland                                                           New York

Norfolk

LA/LB
Savannah 

Jacksonville

Mobile
Lazaro Cardenas, Mexico

Continued Canadian Encroachment
Gateways &
Corridors
Initiative

CN Joliet, IL Intermodal Facility

British Columbia and Washington Port Volume Trends 
4500
4000                                                                   CN Indiana Agreement
3500
3000
Thousands 
2500
TEU 
2000
1500
1000
500
0
2005  2006  2007  2008  2009  2010  2011  2012
Sea/Tac      BC Ports

Coordinated Expansion Of BC Ports
10                                            PMV Inner Harbor
Millions 
Improvements* 

8


6                                                                  High Case Thruput
Planned Capacity
TEUs 
Base Case Thruput
85% Port Capacity
4                                       Roberts Bank
Terminal 2                    Low Case Thruput
In EIS and
Prince Rupert
community
Phase 2-2 
outreach phase 
Prince Rupert                                                Source: Port of
2
Phase 2-1                                                Metro Vancouver
Shovel ready,                                                 * Unspecified
permits in place 

-
2012    2014    2016    2018    2020    2022    2024    2026    2028    2030   Year

Vancouver B.C. Expansion Plan
Roberts Bank Terminal 2 Project

Potential Impact from Shifting Trade Patterns

Traditional
Manufacturing                 Cargo Battle Ground
Areas
New
Suez Canal
Manufacturing
Panama Canal
Areas
Singapore

Forecasted Growth in Container Activity                                Near
12%                                                     Sourcing
10%
8%
6%
4%
2%
0%
2011  2012  2013  2014  2015  2016  2017
North America     World

Capacity for Exports
Loaded to TEU Capacity      Loaded to Deadweight Capacity
7.5 MT per TEU                 13.5 MT per TEU
Cargo Value per TEU:            Cargo Value per TEU:
$37,468                 $12,639


PNW Equipment
Shortages for
40' HC & Reefers
Imports Exports

PNW Supply/Demand Imbalance  Hay to China

Pacific NW Ports
$1,100-$1,500
ocean freight to
China

53' trailer backhaul
Rate differentials                                 rate to S. California
creates opportunity to
source hay in I-15
corridor more
competitively than in
WA.

SO. California Ports
Hay press plant
$200-$300 ocean                   near Ports
freight to China

Incentives to Anchor Cargo
State Tax Incentives 
Georgia           Virginia         South Carolina           Georgia           Virginia         South Carolina 
Job Tax Credit up to $3500 per      Barge & Rail Usage Tax Credit       Port Usage Tax Credit up to                                          Barge & Rail Usage Tax Credit
Job Tax Credit up to $3500 per job                             Port Usage Tax Credit up to $8M 
job                           $25/TEU                       $8M                                                      $25/TEU 
Investment Tax Credit for           International Trade Facility Tax       W&D tax credit up to $1M
Manufacturing               Credit $3000 for every          Investment tax credit for                                 International Trade Facility Tax
Inventory Tax Exemption When       employee or 2% of an capital         manufacturing 2.5%                Investment Tax Credit for            Credit $3000 for every employee or
Shipped out of State            investment that increases port                                                                                  W&D tax credit up to $1M 
Manufacturing                2% of an capital investment that
Investment Tax Credit for            volume                                                                                             increases port volume 
Manufacturing               Virginia Manufacturer's Port
Port Tax Credit gives bonus on       Volume Tax Credit $50/TEU
top of Jobs & Investment credits                                                         Inventory Tax Exemption When     Virginia Manufacturer's Port Volume  Investment tax credit for
of $1250/job and 5% of                                                            Shipped out of State            Tax Credit $50/TEU             manufacturing 2.5% 
investment for increased                                                             Investment Tax Credit for
volumes through the Port                                                            Manufacturing 
Port Specific Incentives 
Port Tax Credit gives bonus on top
of Jobs & Investment credits of
Long Beach     Portland      Vancouver      Virginia
$1250/job and 5% of investment 
$10 for every              Carriers get a $10 per      Intermodal Incentive     First Port of Call
additional container       container incentive to      $10 per TEU paid       Incentive: $150 per box 
moved by rail           call at the Port, not to     directly to the Ocean
The port on Aug. 1 will       exceed $1 million.          carrier.
cap its daily dockage                          Wharfage discount:
fees at $8,641 for                             10%-2.9% 
ships longer than
1,132 feet

Port of Seattle Situation

Trans-Pacific Trade
Market Share Imports from Asia by Coast with Sea-Tac 
90%

80%

70%                            2002
Lockout
60%                                            Rail Contract
Labor           Renewals 
Shortages 
50%

40%

30%

20%

10%

0%
1992   1993   1994   1995   1996   1997   1998   1999   2000   2001   2003   2004   2005   2006   2007   2008   2009   2010   2011   2012
East/Gulf Coasts     West Coast     Sea/Tac

Port of Seattle Strategic Focus
Continue infrastructure improvements to handle
large ships efficiently & cost effectively. 
Work with port stakeholders to find ways to
increase terminal productivity. 
Work with the state & local stakeholders to
increase and anchor imports to help support
exports. 
Promote PNW transloading alternative to
importers to keep equipment local in support of
exports. 
Continue to address the HMT imbalance.

Thank You

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