Port of Virginia Blog

Virginia Log Exports Get Reprieve from Ban; China OKs Test

Richmond -- Following a ban on exports of Virginia logs to China that has lasted more than a year, the Chinese government has agreed to a six-month pilot program that will begin re-opening that critical market to hardwood and softwood logs from the Commonwealth.

“China is our second largest agricultural trade partner and the ban was negatively impacting both Virginia's exporters and our valued customers in China,” said Gov. Bob McDonnell as he announced the pilot program. “My administration will continue working with all involved parties to see that this pilot program is successful and eventually leads to full open market access.”

While technical details are still being finalized, Virginia logs will be allowed to re-enter China beginning June 1 via certain designated ports and with enhanced pest treatment and testing protocols under the terms of the pilot program.

In April 2011, China banned both hardwood and softwood log exports from Virginia and South Carolina, citing pest interceptions on logs exported from the United States. For the past year, the governor and the secretaries from the Commonwealth’s departments of Agriculture & Forestry and Agriculture and Consumer Services have worked to resolve the issue.

During a trade mission to Asia in May 2011, McDonnell met with Chinese commerce and agricultural officials to discuss possible solutions to the ban. At that meeting he invited technical experts from China to visit Virginia to see first-hand how logs are harvested, inventoried, and undergo treatment or testing to prevent the unintended transport of pest organisms.

In April, a delegation from China's Inspection and Quarantine Bureau arrived in Virginia to examine the quality, safety and security of log exports from Virginia. Working together with staff from USDA, the Virginia Port Authority and members of private industry, the Commonwealth demonstrated the effectiveness of treatment, tracking and inspection protocols in place to guard against unwanted pests being transported in log shipments.

“It was a pretty quick turnaround from the time the Chinese delegation was here to the time we got the answer,” said VPA Executive Director Jerry A. Bridges. “We have all the necessary processes in place for safe export of this cargo. If it goes well for six months, as we suspect it will, we will start to recapture this business.”

In 2011 the value of Virginia's log exports was estimated at nearly $57 million, down $10 million from 2010. Prior to the ban, Virginia was a major East Coast supplier of logs to China, the world's largest log importer.

APM Terminals Submits Unsolicited Conceptual Proposal for Operating Rights at VPA Terminals

Norfolk – On Tuesday (May 22), the Virginia Port Authority Board of Commissioners was briefed by Virginia Secretary of Transportation Sean T. Connaughton on an unsolicited conceptual proposal from APM Terminals (APMT) to operate the state-owned/leased terminals.

Operations at all of the VPA’s terminals will continue as usual while officials at the state’s Office of Transportation Public-Private Partnerships begin to evaluate the proposal.

“As this evaluation goes forward we’ll continue to focus on customer service, delivery of service and our commitment to making Virginia the leading port on the US East Coast,” said Jerry A. Bridges, the VPA’s executive director. “Customers will continue to work with the same VPA and VIT representatives they have worked with in the past; nothing has changed. Regardless of the outcome of the PPTA process, state ownership of its marine terminal assets is not in question.”

Throughout the evaluation of the proposal, Virginia International Terminals Inc. (VIT) will continue to be the terminals’ daily management and operational company as it has been since 1982, Bridges said.

The APMT proposal was submitted under the state’s Public Private Transportation Act of 1995 (PPTA), which was put into place to encourage investment in the Commonwealth by private entities by creating a more stable investment climate and increasing transparency and public involvement in the procurement process.

Michael J. Quillen, chairman of the VPA board, said he sees this proposal as a very positive development for the port and validates Hampton Roads as world class port facility.

“No other port on the East Coast is garnering this kind of attention from arguably the world’s leading terminal operator,” he said. “When APMT decided 11 years ago to build its terminal here it sent a message to the rest of the world about The Port of Virginia. Now it is seeking a long-term concession and we’re flattered by this interest. Once again, we’re in the spotlight and it is a very positive position to hold, especially when you consider that the entire industry is watching. We have supreme confidence in VIT, our current operating entity, but we have an obligation to evaluate all options.”

During a five-month period in 2009, the governor received three proposals under the PPTA from groups seeking long-term operating concessions. Each proposal was reviewed in accordance with the PPTA guidelines and in 2010 the governor determined that a long-term operating concession as proposed was not in the best interest of the port or the Commonwealth.

Port’s Board of Commissioners Will Meet at 12:30 p.m. on May 22

Norfolk – The Virginia Port Authority Board of Commissioners will convene its regular board meeting at noon on Tuesday, May 22, at 12:30 p.m. The meeting will be held at the Town Point Club, Buoy Room, 300, on the third floor of the World Trade Center building in downtown Norfolk (23510). The meeting is open to the public. The agenda and meeting materials can be viewed at the following Web address: http://www.portofvirginia.com/about/board-room.aspx.

 

 

Virginia’s Container, Rail, Breakbulk and Barge Growth Continues

Norfolk – The Port of Virginia handled 169,644 TEUs in April, an increase of 5.2 percent when compared with totals from April 2011. Year-to-date, the port has handled 647,713 TEUs vs. 633,919 TEUs handled during the same period last year, an increase of 2.2 percent.

Also in April the breakbulk tonnage total was 33,867, a 2.7 percent increase when compared with totals from last April. The year-to-date breakbulk comparison in tons (2012 vs. 2011) is: 128,254 vs. 107,546.

Total rail containers handled in April were 29,823, a 19.8 percent increase when compared with last April. The year-to-date rail containers total is 115,573 vs. 104,383 for the same period last year; an increase of 10.7 percent.

The number of containers moved between the Port of Richmond and the Hampton Roads Harbor on the 64 Express barge service increased 27.7 percent in April; the month's total was 755 containers. The year-to-date total for the barge is up 85.2 percent: 2,975 containers vs. 1,601 containers handled during the same period in 2011.

Calendar year TEU totals, 2012 vs. 2011:

• April 2012 = 169,644
• April 2011 = 161,254
• March 2012 = 166,719
• March 2011 = 159,754
• February 2012 = 157,050
• February 2011 = 153,646
• January 2012 = 154,300
• January 2011 = 159,265

Virginia Gets First-In Call on MOL Asia Service

Norfolk – The Port of Virginia in June will add a "first-in" vessel call from Asia to an expanding string of announcements that point to growing interest from global ocean carriers seeking to capitalize on the port's deep water, rail connections and modern facilities.

In June, ocean carrier MOL will begin weekly calls at Norfolk International Terminals; the sailing of the MOL Partner on June 2 will inaugurate the service.

"This is, to say the least, both exciting and important for Virginia," Jerry A. Bridges, executive director of the Virginia Port Authority said. "A first-in is of great benefit to our large import customers because they'll be getting their goods to their shelves quicker. It also shows a growing confidence in Virginia by the ocean carrier community in our ability to reach their customers, and do so expeditiously."

The port rotation of the SVS (South China/Vietnam – the U.S. South East Coast) service, as it will be called, will be: Hong Kong, Yantian, Singapore, Suez Canal transit, Algeciras, Virginia, Savannah, Jacksonville, Charleston and Cai Mep. The service will be jointly operated by MOL and Evergreen. MOL will provide nine ships and Evergreen one ship, with the capacity range of 4,500-5,600 TEU per ship.

"This service will offer great transit times from Southeast Asia and West Africa, via transshipment," Bridges said. "With that being the case, I think we are in a very good position to build some business in West Africa; we see a lot of potential there."

The MOL news joins two other similar announcements made this year by the VPA, both of which were last-out vessel calls from Virginia.

In April, Virginia gained a last-out port call as a result of the CKYH shipping alliance's decision to upgrade its all-water services that operate between Asia and the US East Coast. That news was preceded by Mediterranean Shipping Co.'s announcement in February that it was going to make Virginia the last port of call on the company's Golden Gate Service, which links the US East Coast and the Far East.

"These kinds of decisions, or changes, don't come easily to the ocean carriers," Bridges said. "So when they choose Virginia, it broadcasts a larger message about our ability to compete, to deliver a high-level of service and to execute our core job which is to move cargo – and do it quickly."

 

Port Scores Perfect in Agency Preparedness Assessment

Norfolk – The Virginia Port Authority earned a perfect score on its 2011 Agency Preparedness Assessment, an annual exercise for state executive branch agencies and institutions of higher education that measures how well they are prepared for an emergency.

"We take this assessment very seriously and shutting down the port because we weren't prepared for an emergency or mishap simply isn't an option," said Ed Merkle, the VPA's director of port security and emergency operations. "We plan, test, document, make improvements, practice and continue this cycle. This level of preparedness is to the benefit of every citizen of the Commonwealth."

In 2011, Gov. Bob McDonnell signed Executive Order 41 which mandates the Office of the Secretary of Veterans Affairs and Homeland Security to coordinate an annual preparedness assessment for executive branch agencies and institutions of higher education in order to measure the overall level of preparedness in the following major areas of emphasis: physical security, continuity of operations planning, information technology security, document protection, human resources preparedness, training, and interoperable communications

"The state government agencies and institutions of higher education of the Commonwealth of Virginia must continue to be prepared for all disasters," McDonnell said. "It is the responsibility of state government to provide for the well-being of the citizens of the Commonwealth and to ensure the continuity of state government operations, including the delivery of essential state governmental services."

The Preparedness Index allows a ranking of the emergency preparedness level based on standardized component areas. Index scores are based on a maximum 100 points. The components are:

Physical Security

Continuity of Operations Plan (COOP)

Information Security

Document Protection

Fire Safety

Human Resources

IHE Emergency Preparedness

 

Virginia Tops Site Selection Magazine’s 2011 Competitiveness Ranking

Richmond - Site Selection magazine has named Virginia the winner of its 2011 Competitiveness Award, which recognizes excellence on the part of a state-level economic development group.

The Virginia Economic Development Partnership (VEDP) was honored at an awards ceremony on April 23 at the Industrial Asset Management Council's spring 2012 Professional Forum in Texas. The Competitiveness Award goes to the state with the most points earned in a 10-factor index based mainly on Site Selection publisher Conway Data Inc.'s New Plant database of new and expanded facility announcements.

"We've worked very hard these past two years to bolster Virginia's reputation as a place to work and relocate businesses to, and we've earned top rankings on various measures of that," Gov. Bob McDonnell said. "This Competitiveness Award recognition is terrific, as we have put a lot of resources into economic development incentives and grants and are spending a lot of time on the road telling Virginia's story."

"The Virginia Economic Development Partnership and Governor Bob McDonnell have demonstrated that a pro-business, get-the-word-out strategy coupled with a predictable, low-tax business climate result in a competitive edge that is quantifiable," said Mark Arend, the magazine's editor-in-chief.

Lieutenant Gov. Bill Bolling said that during the past three years, Virginia had invested more than $100 million in proven economic development and job creation programs and these investments have made Virginia more competitive in the economic marketplace.

"The results have been impressive, as we have created 119,800 net new jobs in our state and reduced our unemployment rate to 5.6 percent," Bolling said.

The Virginia Economic Development Partnership, a marketing organization, was created by the Virginia General Assembly in 1995 to encourage, stimulate, and support the development and expansion of the economy of the Commonwealth. The Partnership is a state authority, which is governed by a 22-member board of directors appointed by the governor and the Virginia General Assembly.

To accomplish its objectives of promoting economic expansion within the Commonwealth, VDEP focuses its efforts on business recruitment, expansion and international trade with offices in Belgium, Shanghai, Mexico, Japan, India and the United Kingdom.

For more information on the award go to: http://siteselection.com/issues/2012/may/competitive-states.cfm.

Bond Rating Agency Gives VPA Bonds ‘A’, Stable Outlook

New York – Fitch Ratings has affirmed its long-term 'A' rating of the Virginia Port Authority's outstanding port facilities revenue and refunding bonds and based on its overall financial picture, gave the agency a "stable" rating outlook.

"To continue to maintain our solid rating says a lot about the job being done here and how the future of The Port of Virginia is viewed by an independent expert," said VPA Executive Director Jerry A. Bridges. "This also sends out a larger, very positive message to our customers and stakeholders about the fiscal health of this port."

In its analysis, Fitch highlighted the VPA's sound financial track record, the port's overall growth/expansion plans, its long-term contracts with primary customers, continuing improvements to rail service strong support in state government, experienced leadership at Virginia International Terminals Inc. (VIT), the VPA's non-stock operating company. In addition, the port's natural assets such as deep shipping channels, a geographically strategic position on the East Coast and were all cited as factors for continued financial health.

"The Port of Virginia is well balanced among both trade lanes and shippers," the international ratings agency said in its report. "With over 100 distribution centers in close proximity to the Port of Virginia, over 47 percent of the port's cargo originates or is destined for locations within Virginia. The authority has a diverse mix of customers, most with contracts extending 10 years or longer.

"The port benefits from a 50-foot channel depth with no air draft restrictions and improved intermodal connections with the opening of the Heartland Corridor and the recent addition of CSX on-dock rail service at the AP Moeller Terminal.

" … In addition, in January 2012 MSC's Golden Gate service shifted VPA to the last port of call on its outgoing voyage, putting the port in a good position to capture additional export cargo."

To see the full report, follow this link: Fitch Affirms Virginia Port Authority's Port Facilities Revenue Bonds at 'A', Outlook Stable.

Drawing independent research, Fitch Ratings provides analysis to financial professionals worldwide with information on risk management and investment decisions.