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COVID headwinds hit port as Edgemoor dawn nears

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The Port of Wilmington has seen an uptick in cargo during the supply chain crisis as shippers search for smaller ports to utilize. | DBT PHOTO BY JACOB OWENS

WILMINGTON – Following the onset of the COVID-19 pandemic, ports around the world have been beset by workforce shortages, unacquired cargo stacking up in storage yards and transport ships lining the ocean awaiting their turn to be unloaded.

That supply chain crisis has led to increased product price inflation and delivery delays to consumers and companies around the world.

At the Port of Wilmington, the ships aren’t stacked up in the Delaware River, but the operator of the nearly century-old port hasn’t escaped unscathed either. The local subsidiary of Emirati-based Gulftainer has reportedly faced cash flow deficits, forcing it to obtain a $10 million infusion from shareholders this year, according to the News Journal.

Despite the financial pressures, Gulftainer is seeing steady shipments coming to the port with trade revving back up – Wilmington saw its first day of full workforce and full berths since the pandemic began within the last few weeks.

‘Small but mighty’

GT USA Wilmington CEO Joe Cruise addresses an EU panel at the Port of Wilmington in October. | DBT PHOTO BY JACOB OWENS

Gulftainer, the world’s largest independent port operator, took over the Port of Wilmington in October 2018 after striking a 50-year lease deal with the state entity that previously ran the port, Diamond State Port Corp.

Since then, Gulftainer has invested $88 million to repair the port’s eight berths, road infrastructure and warehouses while also installing additional crane rail, so that ship-to-shore cranes now run the length of the berths. In September, it completed a $37 million installation of electric rubber-tired gantries, which are the large blue container-stacking vehicles visible from nearby Interstate 495.

The 300-acre port has 10 berths, including eight on the Christina River of which six are now serviced by the large gantry cranes that can lift containers off ships and into stacks up to four high. That has expanded the amount of cargo that can come into Wilmington by about 70%.

Joe Cruise, a GT USA executive who was among the team who negotiated the privatization deal five years ago and the new CEO at GT USA Wilmington, said that Delaware’s port was unlike others he has managed.

“I had worked along the Delaware River prior to coming to Wilmington, and the first time up I found that this place has a lot of space, a lot of unused space,” he said during an Oct. 14 presentation to a European Union delegation. “There’s not too many ports in the United States that are blessed to have the land that we do, and we continue to look for ways to utilize that with greater volume.”

Wilmington is currently the No. 1 port for fresh fruit in the United States and the No. 1 port for bananas in all of North America, handling 200,000 refrigerated 40-foot containers a year, Cruise said.

Five new rubber-tire gantries allow Gulftainer to stack more containers at the Port of Wilmington, increasing capacity. | DBT PHOTO BY JACOB OWENS

Dole and Chiquita both unload ships at Wilmington once a week to deliver bananas, pineapples and other fruit to much of the East Coast. Wilmington also unloads pallet ships primarily bringing fresh fruit like Moroccan clementines, Chilean grapes, and a variety of fruit juices from South America.

But aside from fruit, Wilmington also handles a variety of breakbulk products from rice to salt, petcoke to even pregnant dairy cattle. It also has three major auto carriers that deliver imports here, but it does more exporting for companies like Ford, Chrysler and General Motors, as well as military equipment.

Over the past few months, the port has also seen an influx of timber shipments, especially plywood from Austrian company Blinderholz, which Cruise first booked to Gulftainer’s Port Canaveral, Fla., terminal. Seeking to get product into the country as quickly as possible, shipments arrived in Delaware and are seen stacked all over the port awaiting distribution.

“I can tell you that, based on the phone calls that I’ve received in these six weeks since I’ve been back to Wilmington, if we had several hundred thousand square feet of both reefer as well as dry storage, we could fill it. So, it’s just a matter of how quickly you can construct some of these sheds to keep up with demand,” Cruise said.

Delaware Secretary of State Jeffrey Bullock, and chairman of the Diamond State Port Corp. which oversees Gulftainer’s operations, commended the efforts of the company to date through a challenging period with the COVID-19 pandemic upending global trade.

“They are doing a really good job, a better job than we did, quite frankly, when we as the state operated the port,” he said. “We’re very proud of this place … it’s a small, but mighty, port.”

Edgemoor awaits

While Gulftainer has poured millions into its operations in Wilmington, another bigger project lies just 2 miles up the Delaware River. The company plans to invest upward of $500 million to develop a new Port of Edgemoor from the 100-acre former DuPont and Chemours manufacturing site.

The Edgemoor Container Terminal will be about twice as big as the current port’s capacity. | PHOTO COURTESY OF GULFTAINER

The Diamond State Port Corp. bought the site at 4600 Hay Road from Chemours for $10 million in 2017 and has signed agreements with Gulftainer on its development. Since then, the partners have been working on state and federal permitting approvals to move forward.

In September, the Delaware Department of Natural Resources and Environmental Control issued its approvals for the redevelopment of Edgemoor. Its permit authorizes the building of a 112-foot-wide-by-2,600-foot-long wharf, dredging of the berth and access channel to a depth of 45 feet, and installation of 3,200 feet of bulkhead along the shoreline.

Cruise noted in particular how important the dredge depth was in modern cargo shipping.

“The limitations we have here at the current facility is on the Christina River; the berths that we have are a maximum draft of 38 feet. Most of these large container ships coming to the U.S. now are anywhere from 5,000 to 22,000 TEUs [twenty-foot equivalent units] and require a draft of over 40 feet up to 50 feet,” he explained.

By dredging the river down to 45 feet, Edgemoor could serve ships carrying as many as 15,000 TEUs from Asia, Europe and South America with a total built-out capacity of 1.2 million TEUs, according to Cruise. Gulftainer is currently in negotiations with “one of the top three container lines in the world” to come in and partner on Edgemoor, he added.

“So, it’s not necessarily a ‘build it and they will come’ situation. Once this container line signs up, they will bring the necessary volume to fill that 1.2 million TEU container terminal,” Cruise said. “We see the port as an economic engine, not only for the city of Wilmington or for the state of Delaware, but for the entire Mid-Atlantic region.”

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