Shipping overseas through the Great Lakes
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Kai Ryssdal: Here’s an under-reported bit of good economic news. We learned this morning American manufacturing has now been expanding for 17 straight months. The Institute for Supply Management, which keeps track of that sort of stuff, says the creation of new stuff, from cars to computers, is picking up speed.
Part of that’s because our economy is rebounding, but there’s also growing demand from China and some other emerging markets. If you’re an exporter in the middle of America, you’ve got choices when it comes to shipping. You could load your products onto a plane, which is expensive. You could truck them to a port on the East Coast, which is slower.
Or ship out ’em straight out through the Great Lakes. From the public media project Changing Gears, Dan Bobkoff has the story.
Dan Bobkoff: It is not easy to get steel mill equipment from Ohio to Germany.
Chuck Jackson: This is the truck!
Especially when it’s the largest piece of machinery a company has ever made.
Jackson: This is a 19-axel truck.
Earlier this year, a manufacturer near Youngstown called Butech Bliss beat out foreign firms to supply a German mill with enormous steel cutters.
Jackson: Actually, the sheer itself ended up weighing about a million and a half pounds.
That’s Chuck Jackson, the vice president. It was a $15 million order — half the company’s annual revenue. That was the good news. The bad news? Pennsylvania and Maryland wouldn’t let him truck it on their highways to the port in Baltimore. The trucks were simply too big.
He racked his brain for a solution.
Jackson: I had heard faintly of people shipping out of Cleveland. But I never thought about it.
That ended up being his answer. He shipped the machinery out the St. Lawrence Seaway to Germany.
But this is still not that common. In recent years, an average of 2 million tons of U.S. goods has been shipped overseas through the St. Lawrence, which connects the Great Lakes to the Atlantic Ocean. But most Midwest exports are still transported over land to coastal ports.
Brad Hull: This is essentially a chicken and egg issue.
Brad Hull is a professor John Carroll University. He says freighter operators are reluctant to offer regular shipping service until they see more demand from exporters. But exporters want to see consistent service. And neither side wants to take the risk of going first.
Hull: So, essentially you’ve got both sides that need to meet in the middle.
With no regularly scheduled service, much of the Great Lakes shipping that goes on now is based on need or luck. This year, a drought in Russia has boosted the grain exports from Minnesota, for instance.
Will Friedman heads the Port of Cleveland.
Will Friedman: We’re not in control of our own destiny. Sometimes good things happen, but it’s not because we did anything.
Friedman hopes we’ll soon see the first steps to changing that. There’s serious talk of starting regular container shipping from Cleveland. Feeder ships would travel to Montreal and unload the containers onto bigger freighters.
Sound of people unloading ship
For now, most Great Lakes ships, like this one in Cleveland, just have their cargo secured to the deck. Longshoremen are unloading Swedish steel plates and coils. Those are a lot harder to stack than standardized containers that can hold anything from engines to soybeans to booze. Ports like Cleveland’s could never compete with the coasts, but Friedman says there still could be a lot more business.
Friedman: We just want to be who we are better than we have been previously.
Cleveland and Detroit’s ports generate upwards of $2 billion in economic impact a year, but that’s less than half a port like Baltimore.
John Baker says more activity on the lakes can’t come soon enough. He’s with the International Longshoreman’s Association and has spent decades trying to get more foreign business so his members can get more work.
John Baker: It’s not enough. It’s never going to be enough until we see it. I keep saying it’s going to happen, it’s going to happen, but I don’t see it, and I don’t see anyone pushing as hard as we are.
Baker thinks the ports need to do a better job marketing. They need to tell potential customers that cold weather and ice is only a problem for two or three months, and that it can be easier and cheaper to get to parts of Europe through the Seaway than from coastal ports like New York and Baltimore.
That’s what Chuck Jackson says Butech Bliss learned getting its steel cutters to Germany.
Jackson: We worried and worried and worried about being late. So everything went our way and we actually ended up over there two weeks early.
Bobkoff: That’s actually a great advertisement for Cleveland’s port, isn’t it?
I’m Dan Bobkoff for Marketplace.
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