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REGIONAL REPORTWEST COAST NORTH AMERICA


The port of Longview is


expecting wind energy to be big in 2020 and 2021.


compared with an average between 5-15 cents for a fossil-fuelled power plant. The strength of the wind energy sector


has helped boost operators’ and ports’ fortunes. For Omega Morgan, 2019 was significantly better than the previous year in the project business, which went up about 30 percent, according to Zander. “In the Pacific Northwest, there has been


a tremendous uptick in manufacturing, specifically in high-tech industries. When some of these giants expand, there is more than the 5,000-lbs (2.3-tonnes) machine that makes the computer chip; there is also the water evaporator and other things that go along with this,” he said.


Double-digit growth Crane Worldwide Logistics has also seen double-digit growth in its project group in 2019, according to Chris Palmer, director of projects. For the Houston-based firm the West Coast, particularly the Pacific Northwest, is chiefly a gateway for imports of project cargo produced in Asia rather than a destination market. The oil and gas industry is the firm’s largest focus in the project field. Hanging over many products entering


the USA through West Coast gateways is the issue of tariffs, although the impact thus far has been negligible, said Palmer. “The existing projects were already funded when this came up. There has been no effect from tariffs,” he remarked.


78 January/February 2020 “What creates so much angst is the


uncertainty,” said Strogen. Repercussions are beginning to be felt.


“The major effect of the tariff war is additional cost,” said Palmer. “We have seen some reinvention of transportation supply chains to reduce the cost of transportation to offset some of that 25 percent.” Strogen also sees some changes taking


shape as US firms rejig their sourcing. “Supply chains are not easy to change at a moment’s notice. We see a changing of patterns in sourcing of energy components. Cargoes used to be sourced predominantly from China and we have now seen a shift to places like India. Supply chains for the industry have elongated,” he said. EPCs appear to be under pressure, noted


Palmer. “We see some financial results that are not good. We hear that EPCs are restructuring. Some try to get away from lump-sum projects that tend to have heavy [cost] overruns.” One result of this is a greater interest


We see a changing of patterns in sourcing of energy components ... we have now seen a shift to places like India. Supply chains for the industry have elongated. – Alex Strogen, port of Vancouver, USA


among EPCs to outsource more work to 3PLs. At the same time, they are broadening their supplier base beyond the large players to include smaller niche operators, he observed. This opens opportunities to companies like Crane Worldwide Logistics, which brands itself as a second-tier provider rather than a leader in mega projects, he added. Given the widely publicised need to deal


with crumbling roads and bridges, the construction sector should generate a wealth of project work. However, rising costs threaten to affect this sector. Mace North America, a consultancy and construction company, predicts that growth in construction will slow down to 1.6 percent in the coming year and 1.8 percent in 2021. It attributes this to higher costs of materials – owing in part to higher tariffs on steel and aluminium – as well as labour. In the Pacific Northwest, there has not


been much activity in infrastructure work, reported Zander.


Housing construction Impact Transportation, a warehouse operator/drayage company/trucking provider based at the port of Oakland, has been busy with housing construction. It handled a project for an apartment complex with 22 apartment units. These were pre-fabricated modules built in China that were put together “like Lego blocks”, said Impact president Ron Cancilla. “Basically they are oversized containers,”


www.heavyliftpfi.com


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