Episode 85. Anchors Aweigh: How maritime interests occupy a vital link in the freight industry.

Bernie Fette (00:14):
Hey everyone. Welcome to Thinking Transportation conversations about how we get ourselves and the stuff we need from one place to another. I’m Bernie Fette with the Texas A&M Transportation Institute. To fully understand and appreciate just how much we depend on maritime transportation, take a look inside your home. The furniture you use, electronics, appliances, and kitchen supplies. Even the clothes you wear. Chances are just about everything that surrounds you came from somewhere outside of the U.S. That means those things came here on a cargo ship before being loaded onto the trucks that deliver them to your home or your favorite shopping outlets. It’s a seamless system that appears to be quite simple. Beneath the surface, though, we find a story that’s far more complex. Here to explain that reality is Jim Kruse, a senior research scientist at TTI and director of the TTI Center for Ports and Waterways, where he’s responsible for research involving waterborne freight transportation and its multimodal connections. Thanks so much for being with us, Jim.

Jim Kruse (01:31):
Oh, it’s my pleasure. It’s always fun to chat with you.

Bernie Fette (01:34):
So today we’re chatting about maritime transportation, which has been in the news a little more than usual in recent months. In March, of course, we had the cargo ship that crashed into the Francis Scott Key Bridge near the Port of Baltimore. Then less than two months later, a barge crashed into the bridge that connects Galveston, Texas to Pelican Island. Can you begin for everyone, just by giving us a quick recap of what happened in each case for those of us who may have heard about the incidents but didn’t read beyond the headlines?

Jim Kruse (02:11):
Sure. Well, in the case of Baltimore, what happened was a, a major ocean carrier capable of carrying about, I think 10,000 TEUs, which is containers, was heading outta the Port of Baltimore on a four week voyage. As it was going down the channel, it apparently lost electrical power and needed the electricity to manage the engines. And so everything shut down. They were unable to steer it. They were unable to force it to veer off and miss the bridge. So it went straight into one of the bridge pilings and brought the bridge down. In the case of the Galveston situation, there is an oil terminal right next to the bridge that we’re talking about, and as a tow boat was pulling a couple of barges out of that terminal, it lost control of them. And because of current and high tide and so forth, the barge was sucked into the bridge at Galveston and damaged one of its support structures. So they’re very different kinds of incidents, but they both involve a marine vessel crashing into a bridge.

Bernie Fette (03:08):
Right. In the case of the Baltimore collision, the cargo ship was large, as you said, about 10,000 containers on board. Mm-Hmm. <affirmative>, but it, it was not nearly as big as some out there. Which makes me want to ask you, how has the size of ships that use these ports changed over time, and what are the implications of that change?

Jim Kruse (03:31):
Well, let me, first I define TEU because I used that term and didn’t define it, please. A-T-A-T-E-U is a 20 foot equivalent unit. So a container that is 20 feet long is one TEUA container that’s 40 feet long is two TEUs, and most containers are 40 feet long. So most of ’em count for two TEUs, but that’s how they measure the capacity of ocean going vessels. They measure them in TEUs.

Bernie Fette (03:56):
Okay.

Jim Kruse (03:57):
The TEU capacity of the vessel coming outta Baltimore, I believe was in the 10,000 range, but they’re building a number of vessels now that are in the 18 to 19,000 TEUs. I think some have exceeded 20,000. So this would be considered a slightly larger than normal, but pretty much average size vessel.

Bernie Fette (04:17):
Okay. And as you said, it sounds like the size of these ships and the capacity, the carrying capacity for them is increasing and has been increasing over several years. I guess one of the things I’m wondering is can the infrastructure keep up with and change as quickly and adjust to that magnitude of growth in shipping volume? I, you talked about building bigger ships, but how hard is it to build a bigger seaport?

Jim Kruse (04:45):
Well, there are several factors that have to be considered. One is you have to have a deeper channel, and channels are always maintained by the US Army Corps of Engineers. They have to study it, approve it, and fund it. So that’s one aspect. The second aspect,

Bernie Fette (04:59):
And that’s the actual dredging of the channel to make it deep enough for those ships. Correct.

Jim Kruse (05:02):
Right. Deep enough and wide enough both. I see. But yes, the channel has to be large enough to accommodate the type of vessels they want to handle. Okay. Then you have the dock structures have to be able to handle these vessels, and you have to have cranes big enough to work the vessels, and you have to have yards big enough to store the cargo in an intermediate stage while it’s coming off or getting onto the vessel. And then you have to have connections to the land side. So there’s a lot of things that go into building a port’s capacity. The biggest problem most ports are facing right now is that there’s a constraint on the amount of land they can acquire. If you look back at history a little bit, most of our large cities were built where there are ports. That is why they are where they are. And as the city has grown, it has surrounded the port with urban areas, some residential areas, other industrial areas, but essentially the land’s all taken around the port. And so it’s very difficult for it to expand. So then you have to look at various ways of managing the cargo while it’s in the port terminal and make that more productive. And that’s pretty much what the ports are focused on right now.

Bernie Fette (06:06):
So in the absence of being able to expand, they’re just trying to operate more efficiently?

Jim Kruse (06:11):
That’s correct. There are almost no opportunities right now for a port to develop a previously undeveloped site into a port. So they’re gonna have to find ways to manage what they’re doing more effectively and efficiently.

Bernie Fette (06:23):
I was wondering also if there are any ways in which, getting back to the fact that these were both collisions Mm-Hmm. <affirmative>, if there are any ways in which bridges are typically protected from collisions like these, maybe you could talk a little, if you would, about the option of fortifying the infrastructure to prevent a disaster versus the efforts to respond to a disaster when it happens.

Jim Kruse (06:48):
One of the problems we have with most of our bridges that, that are crossing ship channels or in the way of oceangoing vessels is that they were designed in a time when the vessels were much, much smaller. Mm-Hmm. On the average, today’s vessels going in and out of ports are about four times larger than they were back in the seventies when the Francis Scott Key Bridge was built. So if you look just the impact of something that much bigger, even if you had designed the bridge to support or to resist an impact from a vessel in that day and age, it would not hold up against a vessel four times that large. So the biggest problem we have in fortifying the bridges is that they were not designed, there was never any thought given that vessels would be this big. And so that’s a big concern. What most ports or most bridge construction companies are doing is selling what they call dolphins or bollards, very massive concrete pillars in front of the bridge support structure, so that if a vessel or a barge loses control and it goes on its own down the channel, it will smash into that concrete structure before it hits the bridge and protect the bridge. And that seems to be the way most bridge protection measures are being instituted right now.

Bernie Fette (07:55):
And you mentioned that they’re called dolphins or sometimes bollards, which I guess means that they function in much the same way that the bollards do, that we see, say in front of a storefront on land.

Jim Kruse (08:06):
Yes. They’re there to absorb an impact and to keep the vessel from getting to the bridge.

Bernie Fette (08:11):
On the surface, it might seem to some of us that the Baltimore and Galveston examples had some things in common, but you’ve already pointed out that that’s really not the case. Mm-Hmm. <affirmative> that there were really far more differences between those two incidents than there were any similarities. Can you talk a little bit more about those differences? I think you started to earlier, but maybe expand on that just a bit.

Jim Kruse (08:33):
Well, let’s start with the Galveston situation. The Galveston Bridge in question here is a bridge that connects Galveston Island to the Pelican Island. Pelican Island is where the Texas A&M Galveston campus is. And so there are large numbers of students and some industrial facilities on Pelican Island. That bridge is the only connection that that island has to Galveston. And so when it goes down, everybody’s trapped on Pelican Island. The thing about the Pelican Island bridge is it’s a very old bridge. It has been in need of reconstruction for a long time. As I understand it, the Texas Department of Transportation now has it on their books to start rebuilding that bridge in 2025. I don’t know if they can accelerate that, because there are so many permitting and design issues that had to be taken care of first. Mm-Hmm. <affirmative>. But at the very least, they’ll start fixing that problem next year.

Jim Kruse (09:20):
But the problem with the Pelican Island Bridge, it was not designed to resist impacts from barges. It’s an old bridge. It was just basically a bridge to connect two pieces together, <laugh>. And so it was not designed with marine activity in mind other than recreational vessels. So it’s, it just was not designed to handle that. And that’s part of the problem there with the Baltimore situation. It’s a whole ‘nother world. That bridge was actually part of the I- 695 corridor going around the city of Baltimore. It’s, it’s a very heavily traveled corridor, and it handles a lot of traffic and a lot of commerce. The problem you have when the Baltimore Bridge went down, well, lemme back up a step. When the Galveston bridge was hit, it was not in the way of any cargo bearing traffic. It was at the end of a ship channel.

Jim Kruse (10:04):
Nobody needed to go past it to get to any terminals. In the Baltimore case, when that bridge went down, it completely blocked the port of Baltimore. And to put that in perspective, the port of Baltimore is the country’s largest importer of vehicles. It’s also a major exporter of coal and some other industrial commodities. And so when that went down, a whole lot of things came to a standstill in Baltimore and stayed that way for two months or so, which had a tremendous economic impact, both on port employees, dock workers, and businesses that import and export outta Baltimore.

Bernie Fette (10:39):
And you’re talking about, I guess what we could refer to as domino effects from, from an event like this that really reached into multiple areas of society, including people who seemingly would have no direct connection to port activity. People who used the bridge, for instance, to commute to work every day. Mm-Hmm. <affirmative>. And I’m guessing that now, or at least for a time, there was a lot of rerouting of traffic that had to go to other areas. And so again, the ripple effects of something like this would reach out pretty far, it seems.

Jim Kruse (11:11):
Yeah. There are two immediate ripples, if you wanna call them that, that come to mind in, in my case. One is that you have now taken away a major highway. And so traffic’s gonna have to be rerouted for several years through parts of Baltimore that typically weren’t required to handle that traffic. And so that’s gonna create tremendous congestion concerns and traffic management concerns in the area around the port. The other is that all these vessels that were coming to Baltimore, it takes two or three weeks on the water for a vessel to leave its port of origin and get to Baltimore. So when that bridge went down, you had a whole bunch of vessels that were out there in the ocean planning to go to Baltimore that now could not, they had to go somewhere. And the problem that you have is that another port would have to have the capacity to take the vessel on. The second is it had to be able to handle the type of cargo the vessel has.

Jim Kruse (12:00):
Not everybody can handle vehicles and trucks and so forth. Not everybody can handle coal. And so these vessels all of a sudden had to stop, figure out what port they were gonna go to. And then the shipper or the receiver of that cargo in the Baltimore area now had to arrange to pick that up in some other port, which was not in their plans originally. They may not even have relationships with the people that handle that cargo in the other ports. So now you have a mad scramble to organize all the trucking and rail and so forth that has to take place to get this stuff from where it was supposed to be in Baltimore from these ports where it actually went to. And so that increases the cost of business, increase the cost of business, raises prices, and it cost economy a lot of money in terms of elevated cost and prices. And so it’s several ripple effects are taking place and,

Bernie Fette (12:46):
And then eventually those costs get passed on to consumers.

Jim Kruse (12:49):
Right. It’s not reasonable to assume that every bit is just gonna absorb it all <laugh>.

Bernie Fette (12:53):
Right. Right’s, when you talk about the ships that were waiting out in the ocean that could suddenly no longer go to the port of Baltimore. It made me think of another example that might help people understand in their own experience, which is when we are on a plane, it lands at an airport and it was supposed to go to a particular gate, but for one reason or another, it can’t go to that gate. Mm-Hmm. <affirmative>. But all of the other gates have their own line of aircraft waiting to get to a gate. So you’ve got a new one that’s trying to horn its way in to the system and, and again, more ripple effects. Is that a fair analogy?

Jim Kruse (13:30):
It is. And you might even take that one step more. It might be more analogous to a plane that has to be diverted to another airport because the weather’s so bad it can’t land at its original destination.

Bernie Fette (13:39):
Ah, yes. Okay.

Jim Kruse (13:40):
So now you we’re gonna go to New York, now you have to land in Hartford. How do you get back to New York? <laugh>? That’s the problem. Right? Right. And it’s the same thing with the cargo. It, it didn’t go where it was supposed to go, so how does it get where it was supposed to go?

Bernie Fette (13:54):
And the flights are scheduled so tightly, one after another that whenever you try to throw one in, it’s not easy to simply accommodate that. And the same would be true then for the port situations.

Jim Kruse (14:05):
Right. And one of the things that influences the Baltimore situation is the marine industry is pretty much past the pandemic era. Things are actually better now in terms of volumes of cargo than they were before the pandemic. And so there’s a concern that certain terminals might not even have the capacity to take another vessel like this and handle its cargo and get it off onto land and where it’s supposed to be or vice versa. And so you have capacity issues, you have scheduling issues, and then the whole cost structure is now different.

Bernie Fette (14:34):
Right. Looking at this just a little more broadly, it seems that these incidents underscore a persistent reality in our transportation systems. Not only seaports, but all of our transportation systems overall. That being that we often don’t think about those systems very much until something goes wrong, <laugh>.

Jim Kruse (14:57):
Right.

Bernie Fette (14:58):
When a highway bridge collapses, when a train derails, when a commercial airliner crashes. With that reality in mind or that assumption that everything is just fine going on from day to day, can you talk a little about just how much and in what ways we depend on marine transportation without thinking about it?

Jim Kruse (15:20):
Yes, I can do that. And in fact, it’s very interesting. Most people handle a large number of items in their own home that came from overseas. And I challenge people sometimes to just go sit in their living room or their dining room or their kitchen and go around and look at the various items you have there and see if you can figure out where they were produced. My guess is you’ll find that over 90 percent of that was produced in another country, which means they had to get here somehow. And unless it came from Mexico or Canada, it came by water. And so much of what we do is definitely dependent upon ocean transportation. I use one illustration, which I think is very interesting. There are times I show an illustration of a person sitting in a room with just his underwear on. And what I point out is that nothing in that room came from the U.S. And so if you take away ocean transportation, this is what it’s gonna look like. <laugh>.

Bernie Fette (16:10):
Okay.

Jim Kruse (16:11):
And so I, I think that helps people understand. I remember one person saying, well, why do we need a port? We have Walmart. Well, you won’t have Walmart if you don’t have a port. And so you won’t have a place to shop. You won’t be able to get to things you typically use on a daily basis if the transportation system is not working on the ocean.

Bernie Fette (16:29):
And if it’s not working, not only on the ocean, but with the connections that it requires once it gets from ocean to land.

Jim Kruse (16:36):
That’s correct. And, and the pandemic highlighted that because once it got here, there was no place for it to go. Everything was crowded and warehouses were full, rail terminals were stacked up. There was just no place for anything to go. And so you have to have a landside system that can move this stuff right away in an effective and cost efficient manner, or things just don’t happen.

Bernie Fette (16:57):
A lot more complicated than it might seem on the surface.

Jim Kruse (17:00):
It’s amazing. That’s an interesting point because I’ve quite often pointed out to people that just to bring a vessel into a port requires about 20 different entities to actually process that vessel coming. And so there’s a lot that goes on that just is all behind the scenes. It looks like it’s normal, it’s easy to do, it’s not really, and as soon as you throw a monkey wrench into the works, it just goes crazy.

Bernie Fette (17:24):
And sooner or later those products don’t end up on the store shelves.

Jim Kruse (17:28):
That’s right. Or if they do, they become so expensive, you just don’t have the money to buy them.

Bernie Fette (17:32):
Right. How long does a recovery say in the case of the Baltimore incident, how long does a recovery take?

Jim Kruse (17:41):
Well, depends on whose aspect of recovery we’re talking about. As far as the port goes. It was about two months ago that that bridge went down. And the Corps of Engineers has reported they’re about to open the channel to ordinary traffic in another few days. So that’d be, I’m gonna say about two months that it took the marine side to get going. Again on the land side, to replace that bridge is at best a four year project running about $2 billion. And that’s if all the permitting and design and all stuff is done in a very rapid and cost efficient manner. So who really knows, but it’s gonna be a long time before the surface transportation side of this gets repaired.

Bernie Fette (18:18):
So you’re telling us that four years would essentially be a result of fast tracking the project?

Jim Kruse (18:25):
Yes. It’s not unusual for a bridge project to take 7, 8, 9 years to get done. And they’re hoping to get it done in four. So that means they’re really gonna push this one.

Bernie Fette (18:35):
Speaking of recoveries, does the recovery stage involve not only an opportunity to rebuild, but also an opportunity to reexamine or re-envision things in a broader industry sense, given how many changes have happened in the industry since those bridges and ports were built?

Jim Kruse (18:56):
I think there’s a lot of reexamination going on just to name a few areas. Some businesses are now looking at bringing their production facilities away from Asia and back to Mexico or the United States or Latin America, somewhere closer home where there’s not such a risk of things falling apart. Other people are looking at the whole concept of just in time. In the past, systems have been designed to where everything arrives at its destination just as it’s needed. So you don’t have to have a lot of inventory, you don’t have to track it. When it shows up at the door, we throw it into the production process and out it goes to the other end. That’s not working when your system starts failing. And so people are beginning to think now about just in case where they’re gonna have to start adding inventory and buffer inventories to manage these sudden changes or disturbances to the system. So I think that’s another major issue that’s happening. And of course the final issue is how should we design the function of ports and their connected infrastructure so that it can handle the ever increasing volumes that we’re seeing.

Bernie Fette (19:54):
That makes me want to ask you, as you’re looking into possibilities, things to consider in the future. If you could study just one thing in marine transportation after all these years that you’ve been doing it, if you could study just one thing in marine transportation research for the next couple of years and you had all the funding you needed to study that one thing, a sponsor research sponsor gave you a blank check, what would you focus on?

Jim Kruse (20:21):
I think what I’m seeing now that’s most interesting to me is the whole drive to have a non-carbon future in the marine world. That’s an incredibly difficult thing to do because assets last so long, a notion going vessel last a minimum of 20 years. Tow boats on the waterway system last 50 years. So you can’t just wait for a system to roll over and replace it with new, better functioning assets. There have to be things that happen now. So there has to be the ability to retrofit or to change the fuels that current assets are using. And that becomes very complicated because not only do you have to have the right fuel, you have to have access to that fuel. Mm-Hmm. <affirmative>, These vessels go all over the world. And so they have to be able to get what they need in whatever part of the world they happen to be in when they run outta fuel. Right. And that’s not a given. And so I think there’ll be more than one alternative fuel. So what fuels are we gonna use? How are they gonna be supplied and how will that change vessel routing in the future? Will they have to be more selective about ports they go to so they can get the fuels? It’s a massive undertaking and it has to be done in view of the fact that assets aren’t just gonna roll over. You have to work with what you have now and make it better.

Bernie Fette (21:27):
Right. I think I heard you say that you are expecting there to be more than one alternative fuel. Did I hear you say that you expected two?

Jim Kruse (21:35):
Not necessarily. Two, it could be a variety. I mean people, right. Well

Bernie Fette (21:38):
Be your prediction of the first alternative fuel that we might see being used in big cargo ships.

Jim Kruse (21:46):
You know, the best thing about forecast is they’re always wrong. So <laugh>, I hesitate to do that. I know the front runners are ammonia and hydrogen right now that’s, that’s what people,

Bernie Fette (21:54):
Ammonia and hydrogen. Mm-Hmm. <affirmative>. Okay.

Jim Kruse (21:57):
And they were kind of related ’cause hydrogen comes from ammonia. But in any event, it’s that kind of fuel that people are looking at. The obstacles you face are some of them clear up your emissions process and some of them don’t. Some of them require a whole lot more space on board because they don’t give as much bang for the buck or bang for the gallon as diesel does. Mm-Hmm. <affirmative>. And so you have to take more space away from your cargo capacity, which most people don’t wanna do. And then you have,

Bernie Fette (22:21):
You’re cutting into profit margin.

Jim Kruse (22:23):
Exactly. And then you have to also be careful about the safety factors. Is this gonna be more difficult to manage if a problem happens? Will people die if something goes wrong? So all those things have to be incorporated into the thought process. And so there is no one fuel that you could just say, okay, it’s great for the environment, it’s great for safety, it’s great for fuel efficiency, it’s great. None of those match all of those. So there’s gonna have to be a blending of competing objectives are gonna have to come into play. And it’s just too early to tell, quite frankly.

Bernie Fette (22:51):
I think it’s just interesting that you said ammonia and hydrogen and didn’t say one of the other alternative fuels that many of us would be more familiar with — nuclear power for in some instances. For instance, another waterborne example. We have submarines that are running on nuclear power.

Jim Kruse (23:09):
That is an issue that I find interesting. I, I think there’s going to be more emphasis placed on the nuclear fuel option uhhuh just simply because it is cleaner and it’s easier to manage. But the problem is we can’t compare it to navy vessels because they use a technology that is totally different from what you’d wanna put on a cargo vessel. Okay. But the advances in technology for that type of nuclear power on a cargo vessel have been tremendous in the last few years. The safety factor has really increased and the ability to use it is much more applicable than it used to be. So I think we’re gonna see nuclear move toward a higher level of priority in the system of things. But right now it doesn’t have that visibility that I think it should have. Hmm.

Bernie Fette (23:50):
Anything I haven’t asked you about that you were waiting for me to ask you about?

Jim Kruse (23:55):
No, I don’t think so. Uh, it’s just a fascinating how so many pieces all have to come together to make our transportation system work. And all you have to do is mess with one of them and the whole thing goes crazy <laugh>. I think that’s, it’s just an interesting facet of life.

Bernie Fette (24:10):
My last question, what is it that motivates you to show up to work every day?

Jim Kruse (24:15):
That’s an interesting question because I’m gonna be honest with you. It’s not necessarily the, the research I do, it’s the people I work with. I work with a group of people who are highly professional and really brilliant, and it’s just fun to work with people who know what they’re doing and do it well. The stuff that we’re investigating and researching really does make a difference to the lives of people, whether they realize it or not. And so it’s rewarding in that sense as well. So I guess there’s several things that keep me going, but those are the two major ones.

Bernie Fette (24:42):
We’ve been visiting with Jim Kruse, a senior research scientist at TTI and director of the TTI Center for Ports and Waterways. Thanks for being with us, Jim, and thanks so much for making things a little more understandable for all of us.

Jim Kruse (24:57):
My pleasure.

Bernie Fette (25:00):
Maritime shipping, like all other modes of transportation, is one of those things that we hardly pay any attention to until something goes wrong. Like when a cargo ship carrying thousands of containers crashes into a major interstate highway bridge, stranding motorists, disrupting supply chains, and demonstrating clearly how our land, air, and water transport modes constitute an amazingly delicate and carefully balanced system. One in which there is virtually no room for mistakes. Thanks for listening. Please take just a minute to give us a review, subscribe and share this episode, and please join us next time for another conversation about getting ourselves and the stuff we need from point A to point B. Thinking Transportation is a production of the Texas A&M Transportation Institute, a member of the Texas A&M University system. The show is edited and produced by Chris Pourteau. I’m your host, Bernie Fette.. Thanks again for joining us. We’ll see you next time.