Shortage of vessel space just one of many challenges for project forwarders
Cutting that bridge when you get to it

Shipping oversize equipment to a gold mine in a remote area of Peru is hardly the type of request that fazes Russ Steele, president and chief executive of SR International Logistics Inc. Once the equipment cleared Customs, it had to be transported across a bridge to reach the mine, he recalled.

That would normally be no big deal for SR International, a Denver-based forwarder and non-vessel-operating common carrier accustomed to shipping all kinds of oversize freight worldwide for the mining, power, energy and construction industries. This case, however, was different.

"(The equipment) would not fit through the bridge. It was just a little too tall," he said. "My agent told me of this problem and I asked him what we were going to do about it. He said, ‘Let me call you back.’ A day passed with no word so I called him. He said, ‘Oh, it was no problem. We took a torch and notched out the top of the bridge so the cargo could fit,’ " he said.

The equipment included bulldozers and drilling rigs.

"Project cargo is much bigger than pushing documentation. This is the real deal. Anyone can move containers, but it takes someone special to say, ‘We can cut out a piece of that bridge,’ " said Steele, whose company has handled cargo ranging from processing plants, water and wastewater treatment plants, pipelines and cooling towers, to hotel and vacation resort projects.

Project cargo is a world of complex intermodal transportation logistics involving freight that may be too heavy or whose dimensions are too large not only for containers but also for conventional breakbulk ships unless the cargo is disassembled. Then it has to be re-assembled after it’s shipped.

"The more challenging the freight, the better for us because we are a niche carrier," said Kathleen Nicolaus, who handles marketing and export operations in the project department for Russia and Eastern Europe at Orion Marine Corp.

Chicago-based Orion caters to the mining, oil and gas and agriculture industries, especially to remote areas of the world.

"Everything that moves on the Russian rail is difficult. If you take a look at the map, (the rail) crosses so many countries and there are certain dimension restrictions," Nicolaus said. "When shipping to Uzbekistan, you have to be familiar with the infrastructure on the other side. Oftentimes, what can be moved easily by ocean from port to port doesn’t mean it is ready for on-forwarding."

Reynhold Hilzinger, who manages breakbulk and big projects in the export department of CombiTrans Inc., a forwarder and NVOCC in Houston, said moving oversize equipment on highways and securing an ocean carrier are particularly trying.

"Overdimensions is a problem because you have to get a highway permit in each one of the states you cross on the highway. These are complicated shipments. Quotes from the trucking companies sometimes are punitive," he said.

As for booking ship space, "you have to inquire several times to see which one will accept the cargo. Sometimes the lift is too heavy. More than 100,000 kilos is not so easy," he said At the C.H. Powell & Co. office in Greer, S.C., Jon Godfrey is having difficulty finding ocean carriers to move large machinery from South Carolina for rail construction and maintenance projects in Brazil, Panama, Singapore and Taiwan.

"Some of them are smaller machines and will go on the 40-foot flat racks on container vessels. The larger ones, up to 180,000 pounds, often have to be loaded on to breakbulk carriers," Godfrey said.

"The problem is finding carriers that might be able to carry oversize cargo or special cargo to the foreign destinations. There is not an abundance of carriers that go to a lot of these countries. Finding a carrier has been tremendous problem for us," he said.

Even Wallenius Wilhelmsen Lines, which the firm has used to ship machinery to Iraq for the reconstruction of railroads, and which has vessels going out of Japan and Singapore, has been unable to help, Godfrey said.

"We put out a tender and nobody bites. I’ve got machines going right now to the Port of Keelung in Taiwan and there is no service. Everything going into Keelung is full container. We have attempted to go on freight vessels out of Japan or Singapore and the vessels are too small to handle these large machines," he said.

Susan Becklund, director of operations at the Port of Tacoma, is not surprised.

"He’s finding out what we’ve heard for a couple of years. All of the project ships are fully booked. There’s a high demand and limited supply of overdimensional shipping lines."

The issue of capacity also exists at the U.S. loading port. "The machines that weigh 180,000 pounds exceed the lift of the container cranes of the Port of Charleston," Godfrey said.

One solution would be to float a crane into the port, he said.

Having the right connections is critical in the project cargo business.

"It’s about contacts; it’s about networks, about knowing who provides specific services out there," said Steele of SR International. "The market is kind of a good old boy thing. It’s whom you know."

Becklund agrees. "The project ships are a world unto themselves and it’s hard to get in. But once you start learning about it and meeting the individuals, you become part of a family," she said.

Meanwhile, Godfrey is still looking for a solution. "We have been working on this, going back and forth to carriers to try and find a way," he said.

Boxing and crating companies play a crucial role in project cargo, but the demands of the trade have prompted some of these companies to expand their menu of services. For example, G&B Packing Co., based in Bayonne, N.J., provides export boxing and crating for equipment ranging from sensitive electronic components to industrial production machines weighing more than five tons, has added freight forwarding capability and its own fleet of trucks.

"Oftentimes, it’s good not to rely on an outside carrier, especially when the project shipment comes in today and must get to the pier tomorrow," said Keith Nostrant, G&B’s operations manager.

G&B prepares project freight for shipment worldwide by both ocean and air, Nostrant said. Typically, the company receives "unprotected" machinery directly from a shipper or sometimes from a forwarder.

"We make a customized steel pallet to hold the size and weight of the equipment and build a complete box around it," he said.

The primary considerations are the equipment’s dimensions and weight, he said.

"To load the structure you have to make a cradle. One time the job was a blender, a 19,000-pound stainless steel vessel that looks like the back of a cement truck but it was a round cylinder. We had to make a cradle to sit on the skid base then box it. The skid base is critical because it has to hold the piece in terms of weight and be big enough to attach the framework. We’re done completely with the box within a day and a half. We keep lumber and just about everything we need on site. Sometimes we may have to put in a rush order for larger timbers," Nostrant said.

Sometimes G&B receives freight that can fit into a container but that is too big for any kind of packaging. "In those cases, we may physically load it and block it in place without making a box," Nostrant said.

G&B also ships vehicles by air using a type of pallet that looks "like a giant cookie sheet and that’s made to roll in and out of the aircraft. We’ll put the vehicle there and strap it down," Nostrant said.

Some freight is shrink-wrapped, a method that Godfrey at C.H. Powell will use for three machines bound for Umm Qasr in Iraq. Each of the units is 54 feet, 3 inches long; 10 feet, 6 inches wide; and 11 feet, 8 inches high; and weighs 80,00 pounds.

"If we ship the machines on flat racks on open containers, normally we will shrink-wrap them. They’re large and heavy and made to operate outside. Some of them look like railway locomotives. It would be unfeasible to try to crate them," Godfrey said.

U.S. ports with the requisite capacity, notably heavy-lift cranes and berthing space, are predicting higher tonnage numbers because of increasing offshore oil and gas exploration projects, a boom in mining, the growing need for food aid, as well as ongoing U.S. military operations in Iraq and Afghanistan.

The Port of Philadelphia is a case in point.

"The biggest selling point we have is the fact that we have a heavy-lift container crane," said Joseph Menta, a spokesman for the port. "It’s designed to lift up to 375 tons. So if it’s a particularly large, unwieldy project cargo, like a turbine or a yacht, we have the container crane to handle it."

In addition, the state of Pennsylvania has "spent a lot of money raising the bridges and overpasses so trains and trucks can deliver something really big to the port," Menta said.

The port said it handled 15,178 tons of project cargo in 2004, the most recent year for which it has complete figures. That was a 96 percent gain over 2003.

"We expect this to rise because of the limited number of ports that can handle these types of cargoes. Also, the U.S. military now handles a lot of cargo at the port using our heavy-lift crane," Menta said.

The Port of Houston’s Turning Basin Terminal also is a key player in the project cargo trade and not just for the oil industry. The terminal’s Wharf 32 is considered one of the world’s premier heavy-lift project cargo facilities.

Last August, BKA Logistics LLC, a Washington-based forwarder specializing in humanitarian-related project cargo, shipped a complete mobile hospital donated by World In Need International Inc. of Angleton, Texas, to El Salvador. The hospital — a 46,000-pound, 40-foot-long van equipped with a generator, X-ray machine and lithotripsy device used to shatter kidney stones with shock wave therapy — was transported overland from Sacramento, Calif., to Houston, where it was loaded on a container ship for transport to Santo Tomas de Castillo in Guatemala.

The government of El Salvador took possession of the van in Santo Tomas and drove it back to El Salvador.

The Port of Tacoma, which focuses on high-value "overdimensional," heavyweight machinery such as transformers, generators, earth-moving equipment and knocked-down factories and processing plants, is eyeing the growing wind energy sector as a source of expansion for inbound and outbound project cargo traffic.

"(Project cargo) has been a growth area for us and we want to continue to develop it. There’s a lot of dismantling and shipping of processing plants and modules," Becklund said. "We’re hoping to expand to the wind energy (sector). There is a lot of growth in Northern Alberta power projects and in Alaska."

Becklund added that there’s growing interest in wind energy all over the United States.

Ports in the Northwest are also looking to military cargo for expansion, she said.

Ship lines, too, are gearing up for increased activity in specific industries. Crowley Maritime Corp. announced in February that it is building two Heavy Lift Series 400-foot-by-105-foot deck barges to support deep-water energy exploration in the Gulf of Mexico and more remote locations. The barges, the first of which is expected to be available for service in early 2007, will be used to transport topsides, jackets and associated equipment to those locations.