Port of Oakland says it’s well prepared to face new challenge

One of the chief reasons the Port of Oakland remains so bullish on its future cargo operations is the fact that it is located in the epicenter of innovation, noted the port’s executive Director Chris Lytle yesterday.

In his “State of the Port” address, Lytle was quick to acknowledge that the abrupt departure of the nation’s largest terminal operator came as a surprise and disappointment

“But we serve shippers in the most vibrant part of the nation,” he said. “The Bay Area’s economy is booming like nowhere else.”

As a consequence added Lytle, the Port of Oakland will maintain cargo volumes and improve performance as the Ports America terminal closes. 

“This port can handle the business,” the veteran maritime executive stated. “We will do all in our power to prevent disruption to the movement of cargo.”

The Executive Director then outlined plans to revamp maritime operations when Oakland’s Outer Harbor Terminal shuts down March 31. The terminal’s operator said earlier this week it will exit the Oakland port “for business reasons.”

Lytle said ships and cargo now managed at the terminal will be redirected to neighboring Oakland terminals. “We’ve identified a new home for 90 percent of the cargo that must be relocated,” he said. As for the remainder of the business: “there is a good solution for that cargo, and we’ll get there,” he said.

Questions about dockside labor relations were also fielded, as the audience was reassured that the port expected full cooperation from longshore and terminal operators

“They are committed to a smooth cargo transition when Outer Harbor closes,” Lytle said.

Among steps to be implemented:

• Extended terminal gate hours including Saturdays and some weeknights;
• More labor to process cargo transactions; and
• A Central Valley depot to help agricultural exporters pick up and drop off containers

Lytle said he will ask the Port’s Board of Commissioners for approval to help finance transition costs. The funding could be used to provide performance incentives during the initial period of cargo migration. He said cargo-handling efficiency must improve for the transition to succeed. “We can’t keep doing the same old things,” he said. “We must bring service levels up to meet the need.”

According to Lytle, Oakland marine terminals have excess capacity. Closing a terminal and redistributing cargo will lead to more efficient use of port property, he said. The Executive Director said the port will explore future uses for Outer Harbor Terminal that may not include container operations. “There are too many acres devoted to container operations,” he explained. “We now have a chance to reset.”

Among the other topics addressed in the State of the Port speech:

Labor relations: The Executive Director expressed thanks for recent collaboration between the International Longshore and Warehouse Union and the Pacific Maritime Association, the waterfront employer group. “We’ve made significant progress recently,” he said.

Rail improvements: The port will complete construction of its new rail yard in the second quarter of 2016, he said. This will add 44,000 feet of new track. It will give shippers the ability to form complete trains at the port for transport of containerized imports.

Cold storage: Construction should begin mid-year on a 370,000-square-foot Cool Port Logistics facility. It will be able to receive 36 rail cars per day laden with chilled beef, pork, poultry and other perishables from the U.S. interior. “This will cement Oakland as the premiere location for perishable distribution,” Lytle said.

Meanwhile, the Port of Oakland has made plans to meet regularly with members of the Agricultural Transportation Coalition to see that the port remains the key West Coast gateway for exports.